Just after the holiday shopping season in 2017, the Harvard Business Review conducted a survey and analyzed the shopping behaviour of approximately 46,000 Americans. The data revealed that nearly 73 percent of individuals used “used multiple channels during their shopping journey. We call them omnichannel customers.”
How does this shopping channel mix impact the lifetime value of a customer for a retailer? Retailers of all sizes have become increasingly focused on their omnichannel customer experience and how to measure its impact on CLV (customer lifetime value). Today, we’re looking at the relationship between an Omnichannel Retail Strategy and CLV, and offering some tips on how to boost your CLV.
Streamline Customer Service Operations Across Platforms
Service is at the core of shopping experiences and can create a unique differentiator for brick and mortar retailers. Companies need to place importance on their customer service operations and ensure that assistance from real people are available both online and in-store. Associates should have the ability to connect with and serve today’s shoppers both physically and digitally. In doing so, retailers can stay connected with shoppers even after they leave the store, provide assistance while they shop online, and ultimately create a positive, seamless shopping experience.
In providing customers with real-time assistance from an associate, they will be more inclined to shop with that associate as opposed to their competitor where they cannot get the same personalized service. Keeping customers coming back, will undeniably increase the CLV overall. Retailers that have empowered associates to serve online shoppers are seeing a 10x increase in conversion rate and a 50% increase in average order value
Integrate Digital Technology
With an increasing shift from stores to online, retailers need to think of new and exciting ways to bring the human interaction of personalization from stores to their online channels.
Several leading retailers that have utilized an omnichannel strategy have equipped associates with tools and technology that they need to serve both the in-store and online shopper. For example, retailers like Saks Fifth Avenue, equip their associates with a mobile associate app that provides them with an online presence and helps them serve the in-store shopper better. Each associate has their own personal storefront where they can curate product collections and send personalized recommendations to their clients with clickable products. While serving a customer in-store, associates can access online inventory directly through the app and then place the order online. Completing the transaction right then and there is much simpler for the customer and helps “save-the-sale” for the associate. By equipping associates with the right tools, customers are able to have a unified shopping experience and keep them coming back for more, which ultimately increases your customer’s lifetime value.
Showrooming is a marketing term that refers to when a customer interested in buying a product and visits a store to interact with the product. They ask questions and decide between available models with the purpose of going home and purchasing the exact product online for a cheaper price.
In certain situations, showrooming can be used to the retailer’s advantage, especially if the company is able to provide floor employees with the right tools and training. For example, if an item that a customer wants to buy is out of stock, an associate can offer to call/email them when it comes in. If associates cannot beat the price in the moment of an item, the associate can suggest contacting the customer when the item goes on sale. As the associate has already spent the time interacting with the client, then they should have built the trust enough to get their contact information and service the client even when they are not there. Reducing the chance that a customer buys from a competitor will increase that customer’s value to the business (CLV).
Harness Customer Data
As technology evolves, it’s becoming easier to gather customer data. Through clienteling tools, customer preferences, purchase history and shopping habits can be collected and then be harnessed to provide further insight into their behaviours and patterns. Associates can use this information to better understand what the consumer wants and needs. This helps the customer see their own value in the retailer’s world. Once they recognize that their shopping needs don’t need to be re-examined with every touchpoint, they will feel valued, which will keep the customer coming back for a good experience. By understanding their needs and isolating specific desires, you can cater your strategy based on that information, which will inevitably increase customer lifetime value over time.
It’s evident that a strong omnichannel strategy directly increases your company’s CLV. If you want to develop an Omnichannel Strategy to increase CLV, talk to your omnichannel solutions vendor, such as Salesfloor, to develop strategies, customer journeys and integrate the right technology.