Creating memorable customer experiences
There has been a huge shift in retail around the world. Customers are placing more value on experiences than they are on discounts and sale and South Africans are no different.
Online shopping, commoditisation of once-expensive goods like smartphones, and a craving for simplicity among consumers are all factors that are helping to drive this trend. People increasingly agree that the thrill of a purchase fades quickly, but the memory of a great experience lasts a lifetime.
GfK South Africa data reveals that 50% of South African consumers agree that experiences are more important than possessions, a number that will surely rise in the coming years
Rather than wanting to spend money on expensive possessions, we are seeing consumers gravitate towards low-cost experiences such as visiting the beach, listening to music, playing video games, going to church or watching televised soccer with friends. Retailers that want to remain relevant, draw in new customers and retain their current ones need to think about how they will weave their brands into consumers’ day-to-day lives.
Online shopping sets the trend
Online shopping is on the rise. Though we are a long way from the maturity of the US and Europe when it comes to eCommerce, it is a trend that will accelerate the trend of valuing experiences over possessions. Data shows that people who shop in brick-and-mortar stores, do so because they can physically see the product before they buy, they shop there routinely and they get instant gratification by getting the products much sooner. When they shop online, however, it is for saving money, better selection and the overall ease of shopping.
However, consumers can still get excited going to the shops for an out-of-the-ordinary experience. A prime example of this is how South African queued to design their own ice-creams at the Magnum pop-up store in Rosebank and Sandton City/ Nelson Mandela Square.
We can expect to see brands thinking about how they can combine digital and physical channels to deliver the best customer experience and get a competitive advantage.
Experiential destinations
Mall operators are including more experiential elements in their design, putting entertainment-based locations like movie theatres and gyms at their heart. And physical shops are transforming from transactional shopfronts into immersive showrooms and leisure destinations. The point is no longer to close a sale, but to build a brand relationship,
The objective is happy, satisfied shoppers that keep coming back. When they are ready to purchase, they will do so at the places that offer them more than a place to pay. For example, Internationally, Virgin Holidays has said: “We like to do things differently. While most stores are designed to sell, sell, sell, that isn’t the top of our agenda. We want to provide a retail space that is designed to inspire consumers through immersive experiences.”
Topshop South Africa often holds beauty days where customers can get their nails done in-store which adds to the experience.
VR/AR blurs the lines
For some, it’s all about using cutting-edge technology like artificial intelligence or virtual reality (AR/VR) to deliver cool experiences and high degrees of personalisation. Technologies such AR/VR will find a role in digital and physical stores alike. Some 59% of respondents to GfK South Africa research say they are more likely to visit a retail store that offered some sort of VR/AR experience. International brands like Lowe’s use VR to help customers visualise what decorating a room in their house might look like.
Digital stores on the high street
Just as we have seen physical stores move online, we’re seeing online shops like Yuppiechef and the UK’s Hotel Chocolate set up showrooms or high-street branches. Physical shops worldwide, meanwhile, allow shoppers to order online and collect in-store, or vice-versa. They’re also looking at how to use digital data to deliver personalisation—for example, using facial recognition to offer personalised service based on their relationship with the customer.
To earn loyalty, retailers and brands need to delight shoppers, not just persuade them to buy. A better environment and experience will keep shoppers coming back. They need to offer an environment, whether that’s online or offline, that inspires and a personal service that delights. Those that deliver relevant and exciting experience benefits can break through the clutter and win customers for life.
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Article Credit: GfK South Africa