As e-commerce develops, the dehumanization of Customer Relations leads to a divide between the point of sale and consumers. Not to lose the benefit of the ultimate customer support, the independent retailer must keep up with maintaining close relations with one’s customers by sharing value-added informative contents on new developing social media on a regular basis.
Conversely, pure players who wish their websites were the extension of real stores, do their best to put the human being back to the centre of their process.
Consumer behaviour has drastically changed during the last decade because of the rise of e-commerce, the ongoing popularity of social networking and the growing use of the mobile Internet. The Web has become interactive and collaborative, changing status from 1.0 to 2.0; websites have turned into proper self-expression places. Clients have been through a transition from the status of spectators into one of mobile and social actors, they have started to exchange points of view, and to learn from other internet users’ experiences.
Real shops have rapidly lost their key roles as information platforms and #1 purchasing spots but not their primacy among existing distribution channels. Brick and mortar distribution has undoubtedly been showing signs of resistance which prove that it is far from losing its leadership.
But ironically, now independent retailers whose strength precisely lay in the client proximity and their local fame, are mostly jeopardized in their fundamentals and future prospects. The computerisation of the client relationship has created such a gap between the point of sale and the consumer that independent retailers must now take up the challenge to keep the leadership of customer relationship management.To do so, they must develop a realistic cross-channel approach in tune with their shop’s size and market realities.
As much as possible, independent retailers must do their utmost to have a multichannel presence meeting the needs of clients who do shopping and search for information in a different way.
Consumer behaviour has become hybrid. As a result, shopkeepers and manufacturers must take advantage of the web, mobile phones and social networking. Retailers must learn how to profit by showrooming (one fourth of internet users who visit a website actually prepare their in-store purchases and vice versa). Thus, ready-to-wear products lead the way with cross-channel experiences : 58% of respondents buying in store, 51% online (Web2Shop 2012 survey carried out in France by Tribalista website).
Retailers’ main challenge is to create a unique repository of customer-product relationships matching their organization, whatever the channel of distribution (stock availability, in-house training, necessary staff,…). To reach that target, they must no longer only pay attention to the Brick and Mortar distribution channel but they must take the internet mobile and social networking (engagement) into consideration. Very pragmatically speaking, retailers must at least run a Facebook page and a blogging site to maintain regular contacts with their clients. Talking about multichannel strategy does not mean for all that giving up conventional retail’s marketing tools such as emailing campaign, SMS messages or flyers distribution.
However, local retailers will have to cope with several issues. Despite their ability to multitask, they must take time to acquire a digital culture on the one hand and also to share it with their employees when relevant. On the other hand, they must rethink their organization to integrate communication techniques relying on the new internet and mobile media in their communication or customer service (for instance). The entrance of Gen-Y groups into the workplace could help them take the step towards digital customer service.
Independent retailers must interact directly with mobile users in order to get mobile audiences among their customers.
Independent retailers often put the blame for every failure on e-commerce, which is seen as the main cause of the decrease in their turnover. Actually, the Smartphone is the one to be accused at first for revolutionizing their job.
They had worked their way through and learned how to use mobile-phone tools via SMS message campaigns : invitations to private sales, unique special offers, sales, invitations in advance.
They need to harness all available resources of the smartphone. 10% of the Internet traffic currently originates from mobile-based facilities (smart phones and tablets) and that threshold was reached in october 2012. This trend is likely to continue and to further increase month after month. Internet-users today spend more time on mobile applications than on the mobile internet (today) or classic web (tomorrow).
According to a study carried out by Deloitte on the American market, consumers mainly use their smartphone as an information medium when shopping in stores. 62% of mobile internet users would rely on their phone to find out a shop in the store locator internet but also to check and compare prices (58%) and get information on products (50%). However, the store would remain the favoured place of purchase for consumers. « But one’s role and one’s employees within big chains would be shifting with the merging of online and in-store buying experiences », Alison Paul, Deloitte Vice-Chairman explains.
According to a survey conducted in the United-States, Deloitte showed that using a mobile application in Brick and Mortar stores turned more often individuals into buyers (see Neiman Marcus’s case). The conversion rate has been estimated to 21%. Moreover, mobile users have been considered to spend much more money online than other customers.
The shopkeeper must share social content quickly and regularly.
In accordance with the saying « Talk is cheap and silence is fatal », the local retailer must keep in mind that it is vital to exchange actively with your customers so that these latter may keep on talking about your shop. The retailer needs to be regarded as a unique, trusted, favoured source of information. He or she must interact with them in order to complement and add value to the shop’s offer which has the great advantage of being multi-brand and multi-products.
It is worth repeating that one must create content rapidly in today’s web 2.0 world. It is extremely puzzling for the shopkeeper who is by definition multi-tasking : sales person, merchandiser, buyer, manager, chief of staff… This means being consistent in one’s tone and getting a well-defined editorial stand to earn loyalty of existing customers and acquire new ones through one’s blog, one’s Facebook page or one’s Twitter (one’s « followers »).
As a significant number of English boutiques in children’s wear understood it, the shopkeeper must encourage clients to share content with him or her. This strategy will greatly help the retailers in the task of managing their community; brands such as Burberry have successfully used this approach on social networks through their so-called « « L’art du Trench » photo album (see the article on Business Today). In this way, consumers end up sharing all by themselves their experience of the brick and mortar shop (offline) its offer online.
Wherever online or on a blog, the independant retailer must make a point to write product sheets in a reflective tone far from pure clinical descriptions. This work is all the more important because it will govern the referencing by search engines.
The retailers’ target consists in freely viralizing their products, to be viewed, to tell stories and find new customers, even far beyond national borders. A shop in Paris or on the coasts may keep in touch from a distance with foreign customers without having a website for all that. These customers may come back to the shop next time when they travel to the seaside or to Paris.
Independent retailers must use their major assets (i.e local fame & customer proximity) in the management of customer support on social networks.
Retailers have been facing a new type of customers, who is much better informed than themselves, better skilled and even to some extent information overloaded.
This has resulted in some imbalance of the relationships between small independent shopkeepers and clients. Paradoxically enough, clients very often inform retailers of competitors’ pricing or explain to them the latest innovations from brands yet on display within the shop.
Very disoriented, the independent retailer does no longer know how to perform satisfactorily in a context of declining consumption which requires a more professional business approach. However, the outlook for the future is not so bleak for those who will take the new changes of the customer relationship into account.
In order to adapt to showrooming, retailers must stop thinking that competition means exclusively price adjustment. They have a number of trump cards which they can play. At least, two of their main assets need to be fully exploited : local fame and customer support.
The strength of the retailer used to lie both in geographical and social proximity. Thus, the retailer in children’s wear was a master in customer service. He or she was the one who knew how many births were expected in the shop’s customer base, how many customers were twins’ parents or which ones were to be married during the year. In 2013, the small retail’s challenge is not to give up its basics for the benefits of better structured competitors : distribution networks, e-commerce pure players, department stores, etc…
Customer no longer pay so much attention to the purchase channel. They lay more emphasis on the brand or the retailer. Clients’ engagement is consequently the way to success through communities in which customers feel one cares for them, one talks to them in a way they understand, on the different communication channels belonging to their daily life.
One still has to identify what channels best match their habits: Facebook, Twitter, Pinterest, Instagram, YouTube, e-mails, SMS, blogs… Why not ask them to complete a royalty card or make a quick survey within the shop’s client file? Why not urge them to use a new social network that will be theirs? 50% of consumers mainly search for innovations, additional imputs concerning the products, as shown in the study carried out by l’Atelier BNP PariBas et l’Ifop named « Le futur du commerce : la fin du magasin ? » (« the future of retail, the end of brick and mortar shops« ), analysed by Frenchweb.
In any case, the presence on social networks has become commonplace (Médiamétrie opinion barometer on social networks : 99% of French people are at least familiar with one social network and nearly 77% are members of one of them). The motto, which is difficult to follow in our highly media influenced age, « to live happily, we have to hide away », will very shortly make no more sense. All of us, the young and the not-so-young, already share differently information. Beyond blogs and comments from readers posted on them, we share pictures, videos, presentations through Facebook, Dropbox photo albums, Prezzi or even more simply in e-mail’s attached files. Moreover, a younger generation enter the workforce : the so-called Gen Yers (the hyper-wired the Social Local Mobile generation aged 18-24). Under their impulse, consumption patterns will certainly change for ever.
In brick and mortar shops, the customers like to be able to request additional information from a representative. It is always a good feeling for them to get such good assistance on e-commerce sites as well. Online shops have taken this need for human relationships into account. Online chatting with an advisor proved to be the ultimate response. it was meant to be the appropriate way to support web-users (user friendly) in a stressful situation (« web-stress ») having a hard time to find out the requested information. In other words, human relation still extremely matters even while selling products on the internet. Very often, online advisors are here to assist internet-users live in case of failure at the order-taking stage, so that they may not exit the website at the last minute. This augurs well for the future of independent retailers. Reportedly, pure players would not be able to live in the long run without the support of a brick and mortar network of distribution. Indeed, French consumers urge them to set up a cross-canal strategy. 91% believe that branded networks of stores need to acquire an e-commerce website and 74% argue that pure players must also do business through brick and mortar points of sales (IFOP-BONIAL BAROMETER).
Getting to know and understand today the evolution of distribution helps anticipate and adapt. Traditional retail trade « is not facing a crisis but is undergoing a period of great change. It is our approach to events in the present moment which is crucial for all time to come. Considering it as a crisis provokes anxiety, this actually gives birth to the kingdom of stress and fears. Considering it as a period of great change is far more constructive, dispassionate and optimistic », as Cyril Delattre explained in 2011 in Les Echos economic newspaper. Independant retailers must learn how to handle this new deal. They must learn to create links differently with clients and their future depends on their ability to present their shop’s offer on the 2.0 Web (blogs, sites, social networks).
Article written by Jean-Eric PONTHOU – 11/03/2013.