Given the fact that the customer has decided to come to your store for the first time, leaving many other store options which were available to him, he has already displayed his initial loyalty and from there on, it is up to the retailer to service him well. What is important is to connect with the shopper, to understand his requirements, ensure the availability of the merchandise and more, so that the shopper is excited about coming back. A customer does not become loyal until the retailer has put his first, second, third and then fourth step forward to match up to the customer’s first step in the store. You earn loyal customers by paying attention to the things that matter most to them. The actual meaning of loyalty is only realised if it cuts through the momentary time span. While satisfaction is a commonly cited antecedent to loyalty, the difference between a satisfied customer and a loyal customer is that satisfaction is momentary and loyalty is ongoing. A satisfied customer may not come again to the same store and may continue to experiment. This is the real challenge for the retailers, where it becomes imperative to understand that when a customer does not come back to you, what can you do to bring him back?
Today, retailers are aware more than ever that retaining loyal customers is critical to growing their business, and they are therefore striving to find ways in which to attract and retain customers. Loyalty marketing is one such tool which is being used commonly by retailers today and can take the form of special day redemption vouchers or preferred customers in silver, gold or platinum programmes. However, the key is that loyalty programmes alone don't create loyal customers, but they can be effective. They don't need to be elaborate or expensive—they just need to provide value to the customers.
Primarily, there are two kinds of retailers towards whom a customer typically shows loyalty—niche and speciality products providers. This is because the customer gets tagged onto niche and speciality products offered by them. For example, the world knows that Louis Vuitton has created a niche for itself. It is able to give customers what they want year after year and this creates an emotional attachment to the brand and at the same time, LV ensures that this luxury is surpassed at the highest level.
The second type of customer loyalty accrues to category retailers and sprouts from what type of merchandise assortment they hold. A loyalty may spring if a customer requires a very biased sort of assortment from a retailer who is able to provide that assortment. So what happens is that the customer is given a diverse choice. But for the retailer, the product category is not niche, it is competitive. The retailers’ assortment should cover almost 70 to 85 percent of the lifestyle need.
The dynamics of providing in store service by the retailer is another important element towards ensuring the customer’s loyalty. An understanding of when a customer wants a service and when he does not want a service is important to know. Sometimes, it is not serving the customer that makes the customer loyal, which means that a retailer needs to exercise judgment or an understanding when the customer doesn’t want the service of a personal chaperone. Many a time, customers just need to be left alone to browse around, they can pick what they want, buy what they want and go to the counter, go to the trial room without anyone disturbing them. In a big store, with large number of customers, all having different aspirations of service, it is a tricky thing and there’s a very thin line but that’s how the service works.
The emotional connect
The next important facet is to build up an emotional connection at the time of the transaction. To increase the probability of making an emotional connection, and to identify opportunities to make such a connection, ideally, the people who bring alive a business’s various touch points (the cashiers in the store or the store staff, for example) need to understand what customers want and how they want to feel and in many cases, this can be obtained from just talking to people or observing their behavior.
Therefore, the aspects which lead to customer loyalty specifically in the retail industry are—firstly, the brand itself, which has to convey trust, ensuring that it matches the standard that the customer is searching for; the second is the basic needs of a relationship between a customer and a retailer which is always through a product, there has to be a product pack, otherwise they would not have come to the store in the first place; the third is the service and the emotional connect, which is very important to build up the loyalty; and the fourth is the post-sales satisfaction. Therefore, to round it up—there is a pre-sale, there is a sale and then there is a home sale.