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Up close and personal: building the retail customer experience 2.0

By Tara Robertson / September 11, 2019

Let me tell you about the wild goose chase I went on for a tiny collectible figurine.

It started out simple enough: my daughter asked for a L.O.L. Surprise Doll, a kind of 21st century version of the beloved Beanie Babies from the ‘90s. What I soon discovered was not only were the L.O.L. Dolls limited edition and in scarce supply, it felt like every child within a 10 mile radius had to have one.

Only a couple years old, L.O.L. Dolls already dominates a toy category that’s saturated with dolls. How? My daughter would tell you she loves their YouTube content and the satisfaction that comes with unboxing her dolls. Meanwhile, I’d tell you I see L.O.L. Dolls advertising everywhere I go whether I’m shopping online, browsing social media or at home watching whatever kid’s programming is on the TV.

Because what L.O.L. Dolls and other brands have discovered about the retail industry, where volatility has increased by 250% since 2010, is that goods and services alone won’t help brands stand out from their competition. Yes, consumers will always take price and quality into consideration. But with more options available than ever before, buyers want more than a good deal from the brands they shop with. For L.O.L. Dolls, marketers recognized that in combining a scarcity tactic with a bit of child psychology they could create something much more in demand than the dolls themselves: the customer experience.

Instead of competing on product and value, brands are investing in their retail customer experience to keep consumers coming back for more — well beyond the initial purchase. In an industry defined by rapid change and stiff competition, it’ll be the retail customer experience that makes or breaks an individual’s final purchasing decision.

Everything is hyper-personal now

In today’s consumer-driven environment, brands are swapping the one-size fits-all approach to marketing for a rich, meaningful experience to attract and retain customers. By 2020, it’s widely estimated the customer experience will be more important to consumers than the actual products themselves.

In exchange for consumers’ loyalty and patronage, brands are expected to deliver personal experiences that speak directly to a buyer’s needs and standards. Tailored offers and timely discounts go a long way in solidifying consumer loyalty: 63% of consumers are interested in personal suggestions from the brand they shop with. If brands fail to deliver ultra-specific recommendations, 47% of consumers won’t hesitate to seek greener pastures elsewhere.

Those personal recommendations are what keep me coming back to Anthropologie despite knowing I have hundreds of other clothing options available to me. When I open an email from Anthropologie, seeing suggestions based on my previous purchases makes me feel like the brand understands what I like and I can trust them to recommend clothes that fit my personal style. Between the customized emails and retargeted ads on my social feeds, Anthropologie’s marketing team hooks me more often than I’d care to admit!

Establishing this level of trust with consumers is the difference between building a customer base of loyal advocates versus one-off shoppers, and leading retailers have the financials that prove personalization is worth the effort. For example: Amazon’s product recommendations are estimated to make up 35% of all its consumer purchases while Netflix estimates its own recommendation engine is worth $1 billion per year.

Customization ≠ personalization

While most retailers recognize the value of personalization, plenty continue to conflate the term with customization.

Consider a shoe brand that enables shoppers to pick the color scheme for a sneaker; this falls under the customization label. Customers walk away with a shoe that reflects their aesthetic preference, but it’s not really unique or personal to that individual. Personalization is if that same retailer made a specific recommendation for a shoe because they knew their customer plays basketball, loves the Miami Heat and their favorite player is LeBron James.

Consider how Stitch Fix, a styling service, relies heavily on data from a variety of digital platforms to create a personalized experience for its customers. Beyond the standard likes and dislikes, Stitch Fix stylists care about the deeply intimate client details that don’t show up in past purchasing data. Stylists don’t just want to know a client’s favorite color; they want to know if an individual is going to their best friend’s wedding or recently lost some weight before making a clothing recommendation. It’s this level of hyper-personalization that’s helped the brand post seven consecutive quarters of over 20% growth and distinguish itself from other styling services offering the same product.

Leading retailers know to listen to their audience

To further personalize the experience to the individual, brands are beginning to leverage a tool every brand already has access to: social media.

Armed with social data, brands can keep a pulse on both big picture trends and specific consumer interactions to craft personalized experiences at scale. And tools like social listening enable retailers to distill those thousands of data points into actionable insights to inform how they talk to both individual consumers and their audience at large.

With listening, retailers are better able to connect with their customers because they know what type of content keeps people engaged in conversations online. When someone posts an angry complaint about why they hated a product or service, for example, brands can use listening to surface concerns and take the appropriate actions to resolve individual problems. Likewise, listening to positive reviews can tell retailers a lot about what they’re doing well and build upon their existing customer experience. Instead of responding with an impersonal or blanket statement, brands can use listening data to craft thoughtful responses that resonate with the individual they’re talking to.

In addition to supporting personalized conversations, listening data can also help retailers conduct timely trend analysis to more accurately predict the “next big thing” in their industry. The ability to analyze real-time, unsolicited customer feedback gives retailers the ability to pivot campaigns as needed or get a jump start on new product development. Rather than play catch-up or react to larger market shifts, retailers leveraging listening can stay ahead of trends and meet consumer demands as they emerge.

Brands need to be everywhere at once

Maintaining relevance in a customer-driven marketplace means the customer experience has to be consistent everywhere, regardless of which channel (physical or digital) consumers start and end their journey on. Brands need to always be in the back of their consumers’ minds, and a seamless and mobile experience guarantees retailers are better prepared to engage with customers at every step of the buyer journey.

Consumers today expect a more consistent buying experience that moves with them, whether they’re at home on their computer, in a physical retail store or on the go on their mobile device. Companies like Nordstrom, for example, are already investing in tools to bridge the physical and the digital, creating an app where customers can begin their journey on mobile and end it in a personalized dressing room.

To be truly ubiquitous retailers must also consider the value of social shopping, or buying directly from platforms like Facebook and Instagram. More than half of brands, both direct-to-consumer and ecommerce retailers, have adopted Facebook’s Shop Now button, a trend that’s expected to grow as brands look to meet their audience on the platforms where they spend the majority of their time. Kroger, for example, recently took advantage of TikTok’s in-app shopping feature to target college kids going back to school. And Jordan Brands used Snapchat to target consumers around the Staples Center, selling out limited edition Air Jordans over the All-Star weekend.

From acquisition to relationships

The old saying that it’s the journey, not the destination, holds especially true for retailers as they navigate a changing marketplace that increasingly favors the consumer. If there’s anything I learned from those elusive L.O.L. Dolls is that the process of hunting down and finally getting one of those dolls is more rewarding than the toy itself. And that experience alone is enough to keep my daughter asking for more. From a parent’s perspective, we need to recognize that sometimes it’s the buying journey our children crave; on the flip side, it’s up to retailers to take this into consideration as the market changes and evolves.

In today’s competitive landscape, it’s the experience brands can provide to customers that will separate the market leaders from those struggling to stay relevant. A winning customer experience prioritizes relationships over acquisitions, and it starts with taking the time to get to know customer preferences and building relationships with the individuals that make up your target market. As the retail environment continues to evolve, brands that aren’t afraid to get personal and intimate with their customers stand the greatest chance of surviving and thriving in this volatile landscape.

Tara Robertson

Tara Robertson

Tara Robertson is the Director, Marketing Strategy and Operations at Sprout Social. With over 15 years of experience, Robertson has consulted hundreds of companies on marketing strategy and execution. As a self proclaimed digital nerd, Robertson loves connecting the dots between psychographics and data to produce kick ass results.
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