In the Netherlands well-known traditional retailers, like Scheer & Foppen, Perry Sport and V&D recently went bankrupt. Not only these 3 retailers, in 2016 already 3 other big retailers went bankrupt and in 2015 the number was even higher, 11 retailers. And this month alone, McGregor and Blokker are still struggling for their position. Not only in the Netherlands, but worldwide traditional retailers were faced with the same problems. So what’s going on in the (Dutch) Retail business?
The customers are moving online and not only in the orientation phase, but also in the purchase phase of the customer journey. More and more customers are moving online. The customers expect a perfect online experience and a high quality of service, which has to be transparent and fast. All these online expectations have to be met by the (online) retailers.
Online retailers like Coolblue and Bol.com had a much better implemented and fitted E-commerce strategy than the traditional players. They had state-of-the-art online shops, with quality products, good services and more and more personalized offers and delivery. Also the click-and-collect strategy, wherever the customer wants to pick up their products, were introduced. And even delivery on Sunday’s and within 1 hour-delivery were introduced. And the online retailers made use of the newly available technologies, like QR-codes, RFID and location based marketing in better serving their customers. For example clothing retailers, as part of their e-Fashion strategy, already experimenting with virtual fitting of the clothing for their customers. All these developments were adopted by the online retailers and not or delayed by the traditional ones.
The last few year’s some of those online players, like Coolblue, also made a shift towards the offline world, with the so-called bricks and clicks strategy. For some products their customers want to see, feel and try products before they will do the purchase. The online retailers developed an Omni-channel strategy, where both the online as the offline field are perfectly integrated.
The traditional retailers started too late with their digital transformation towards a-state-of-the-art E-commerce business. This delayed online move couldn’t compensate the loss of sales for the traditional retail players. More and more customers moved towards the online competition, who grew enormously in the last few year’s.
So to survive in the Retail field, what are the focus points for (online) retailers in 2016 and beyond? The following 10 focus points are important to be dealt with:
- Formulate a clear mobile strategy as part of the overall E-commerce strategy
- Always improve the online customer experience
- Focus on responsive and fast loaded websites
- Analyze the customer behavior constantly based on data and improve your online business
- Make personalized offers to your customers (implement hyperpersonalisation). Also, personalized communication throughout each customer journey step: 1/ when the prospect is not on your page (dynamic retargeting) 2/ on your site (custom product recommendations and popups) 3/ after leaving the website (behavior-based messages, e.g. trigger emails).
- Make use of marketing automation and adopt other technologies in having more direct and personalized contact with your customers (on their birthday, after a purchase or web visit, a welcome email, asking for feedback)
- Make use of video presentations of your company, products/services and your team/people/customers
- Always improve your customer service during the whole customer journey, make use of more direct and interactive service instruments, like using WhatsApp
- Let your customers do the reviews and evaluation of your retail business and interact socially with them
- Reward loyal customers and make them ambassadors.
- Identify the most profitable customers that bring the most value to your online store growth. Companies should start measuring and using Customer Lifetime Value as to segment smart (based on behavior and value); then reach out to those customers in the right time with the right message. That effort results in better ROI, optimized marketing channels and campaigns. Plus, growth in KPIs like AOV, Repeat purchase rate, Revenue etc. Yet, only 5% of online businesses implement CLV.