The holiday season represents a massive percentage of annual sales for many companies. For some, it is their make-or-break period each year.
So how can retailers spark customer engagement and brand loyalty in the post-holiday timeframe?
Loyalty360 caught up with David Boone, executive vice president and head of U.S. Partnerships and Shared Services at TD Bank, for his thoughts on the subject.
For so many retailers, the holiday season represents a massive percentage of their annual sales. But, can you talk about what retailers can do in the post-holiday timeframe to help spark customer engagement and brand loyalty?
Boone: Like all of us, we start the new year reflecting and evaluating 2016 and set our priorities for 2017. If you are one of the fortunate retailers whose business is seeing strong year over year growth while the retail industry experiences an unstoppable digital transformation, staying the course while continuing to invest your business model is smart. However, if sales are slowing or have declined, it’s time to take a comprehensive look at your strategy and ask the difficult questions about your performance against your strategic plans. Experienced retailers know that the industry consistently transforms itself, and the digital transformation is well underway.
Retailers need to ask: What are we doing to inspire customers to visit our stores, our websites, our app? In today’s world, not only is it important to have the “right merchandise, at the right time, at the right price,” retailers must fully embrace a customer engagement strategy. Relying on the circular or tried and true retail advertising must be supplemented by a solid customer engagement plan. Do not be afraid to test and learn – a strength of many retailers.
Retailers must also challenge themselves to leverage the assets they have – store networks, websites, customer data, and great bands to dramatically improve their customer engagement across all channels. More than ever, mobile optimization is critical and represents both a challenge and an opportunity for leading retailers to further engage with their customers and contribute to creating an inspiring and legendary experience. Whether your business is growing or slowing, it is the time to ensure every step of the customer experience is exactly where it should be – positive, seamless, and inspiring from end to end.
How will the interest rate hike impact retailers/loyalty marketers and consumer spending in 2017?
Boone: TD Bank has polled retailers at several recent conferences and most retail execs are not expecting a negative impact on sales. Interest rates are still at historic lows, during a time where we're seeing job growth, housing gains, and have consumers who are eager to spend so these small rate increases are not expected to have an impact. If retailers can leverage today’s omnichannel retail marketplace and maximize customer experience, 2017 should be a very good year.
If consumer spending rises in 2017, how can marketers leverage that through customer loyalty programs/upping the ante on customer experience?
Boone: Consumers today are savvy. They’ve had to make do with less for almost a decade now, and as a result, they do their research, they look for deals, they make very informed purchase decisions so marketers need to offer loyalty programs and financing options that offer a real and tangible value. We know from our own cards programs that customer rewards need to strike a smart balance of being achievable for the customer but also worthwhile for the retailer.
But, the good news for retailers is that while price is still the leading factor in purchase decisions, convenience, experience, and brand loyalty are quickly closing the gap, so 2017 presents plenty of opportunity in that regard.
Today, customer experience means so much more than offering an attractive store and a nicely designed e-commerce site. Customers want what they want when they want it – high touch, automation, quick and simple shopping, huge inventory, and so on. As more consumers expect goods on-demand, a seamless strategy for quickly and efficiently delivering goods to the retail storefront in real time is a challenge, but a real opportunity.
What was done well in 2016 on the retail side? And what challenges remain for 2017 that will impact customer engagement?
Boone: For many retailers, 2016 was a trying year, but also an eye-opening one. The shift toward digital commerce was the strongest it’s ever been. More and more retailers offered store pick up options, more retailers leveraged real-time mobile communications than ever before. As an industry, we’re learning what’s effective and establishing that ideal cadence of customer communication and marketing.
The biggest challenge is the balance of traditional commerce with online and mobile commerce and ensuring customers at every channel are having the same positive, inspiring and legendary experience. While the shift toward digital will grow, retailers cannot forsake digital for brick and mortar. Consumers demand excellence at every channel and as retailers, we should demand the same to remain competitive and continue to grow.