7 Ways Retailers Can Adapt to Changing Consumer Behavior

Today’s consumers no longer want to shop ‘til they drop. Tech-savvy, informed and impatient, they want products and services that meet their needs — now. They want convenient and personalized shopping experiences, and that’s just the start.

With consumer expectations high, how can retailers thrive in the ever-evolving retail landscape? Follow these seven tips.

1. Dig Into Your Consumer Data

Your website, physical store and mobile app are first-party data goldmines that help you drive growth and sales. Invest in customer relationship management (CRM) tools to keep track of your consumer data, uncover insights about your customers and learn how to provide a better shopping experience.

Once you aggregate, organize and make your consumer data accessible, you can use it to better understand consumer behavior, preferences and buying patterns. Then, you can use that data to create targeted campaigns and promotions. 

For instance, our luxury jewelry brand client Tacori pulled daily performance activity over the previous 18 months. We found behavioral trends across target segments on its website and social platforms. Through a high-impact social campaign that leveraged signals and behavioral targeting, Tacori saw a 282% increase in its site visitors’ high-value actions — plus a 449% conversion rate growth.

Besides relying on consumer data to launch campaigns, you can also use it to determine:

• What content to produce
• How to forecast product demand
• Which products to keep in your inventory
• How to create more efficient supply chains 
• Which strategies keep customers returning

2. Be a Good Storyteller

Storytelling can boost conversion rates by 30% according to Search Engine Watch. It also sets you apart from the competition in consumers’ minds, which can lead to more retail sales. Well-crafted stories share your brand’s vision and values.

Here’s how to take a story approach to your marketing:

• Weave in stories on your website, retail packaging, videos, newsletters and product pages. 
• Share timely deals and discounts.
• Host online events on social media to promote products, connect with customers and grow your fanbase.
• Hire influencers to create compelling social media content that will likely appeal to your target audience and drive interest.

Capgemini Research Institute shows Gen Z and millennials often make a purchase after discovering a new product through an influencer. Its research showed 32% of Gen Z consumers and 26% of millennials have purchased a product or brand they learned about from an influencer in the past six months. If you aren’t sure what stories to tell, lean on influencers and customers and pull from their stories about using your products.

3. Build Trust and Loyalty

Trust and loyalty influence consumer buying decisions today. To gain more market share with retail consumers — and keep it — consider following these three steps.

Pursue Sustainability

Sustainability and authenticity are major factors in the consumer decision-making process. Many consumers care deeply about what they buy. People don’t want cheap imitations. The Global Sustainability Study revealed more than a third of global consumers will pay more for sustainability.

Consumers want to make conscious choices. They want to know products have been ethically sourced and made in a responsible way with minimal environmental impact. According to a recent GWI report, 61% of Gen Z say they’re willing to pay more for eco-friendly products.

“Managing sustainability intelligently is now good business hygiene,” said our CEO Jay Friedman.  

Offer sustainable and authentic products that best align with consumer values. Source products from responsible suppliers who use sustainable production methods and materials. Show your customers you care and are committed to being a socially responsible business. 

It’s about being transparent. “Transparent is the new black,” said Craig Dubitsky, the founder of Hello oral care and Eos lip balm brands and who was an early investor in Method. And a recent promotion for Hello toothpaste gets the point across with a fun play on words: "knowing" ("no" was in bold within the word) your toothpaste and emphasizing “no” bad stuff lurks inside and it’s a no-brainer to buy.

Listen to Your Customers and Adapt Accordingly

Understanding what your customers need — and delivering it to them — is another way to build brand trust and loyalty.

L’Oréal stays on top of shifting trends by being customer-centric. The beauty giant does extensive social listening to understand how customers feel about its brand and the market. 

When it discovered Gen Z didn’t want a flawless foundation makeup look, L’Oreal innovated with tinted serums, which now have become Gen Z favorites. The brand wouldn’t have known this without keeping its customers and their mindset front and center.

Launch Loyalty Programs

To strengthen your consumer connection, think about creating a loyalty program, one that includes free shipping and discounts and other perks like exclusive or early access offers, personalized recommendations and birthday rewards.

It truly could pay off. McKinsey found 62% of those consumers who signed up for a paid loyalty program spent more money on a brand (their basket sizes were bigger), and 59% were more likely to choose that brand over competitors. Plus, McKinsey found 43% of customers were more likely to buy weekly after joining a loyalty program.

4. Build a Customer Service Team 

Concentrate on these three areas to ensure a more seamless customer experience, both in-store and online. Equip your team to best serve your customers’ needs by:

• Ensuring your employees are knowledgeable about your products and are comfortable and confident explaining their features and benefits.
• Giving employees on the sales floor a device – tablet or a smartphone – so they can quickly and easily access data and assist customers in-store to find what they need.
• Empowering your employees to do what they can to keep customers happy.
• Cross-training your employees so they are well-rounded and can work in multiple areas – customer service, fulfillment, social media and so on. 

5. Invest in Tech

Here are some practical ways to use technology to provide better customer service:

Attach RFID Tags to Your Items 

RFID tags will help you to track items more accurately, keep better inventory records and reduce theft. You can combine RFID tech with other inventory systems like barcodes and sensors. With these, you can monitor trends in inventory levels, predict when to reorder items and better manage supply chains.

Install Self-Service Scanners, Kiosks and Checkouts

Customers can quickly scan barcodes, find what they’re looking for and pay without having to wait. Consider offering a mobile checkout option so customers can shop and pay for items from the convenience of their own phones.

Offer payment flexibility. Customers want to pay for products in whatever way is most comfortable and convenient for them. So offer a variety of options that makes sense for your business including contactless payment such as tap-to-pay cards and digital wallet services such as Apple Pay and Google Wallet.

You can also offer Buy Now Pay Later (BNPL), which allows customers to make a larger purchase now but pay for it over time (typically within three to six months).

6. Make It Convenient

Today’s consumers not only demand convenience for retail purchases – they expect it. To cater to their preferences, consider:

• Giving customers the opportunity to buy online and pick up in-store or curbside.
• Offering delivery services and letting customers choose their delivery window.
• Providing an efficient returns process. Offer free online returns or let customers make online returns in-store.
• Using SMS, chatbots, your app and more to keep customers up to date on sales and happenings and to make personalized offers.

7. Create an Omnichannel Customer Experience 

According to eMarketer and Statista research, online retail sales will reach $6.51 trillion this year. Based on their estimates, over 22.3% of all retail sales will come from ecommerce websites. 

Ecommerce has changed retail strategies significantly. Price isn’t the only factor influencing their decisions. Experience matters now on all fronts.

To deliver a great customer experience, think beyond the sales floor and create an effective online presence. Build user-friendly websites, consider investing in a mobile app and optimize the experience for shoppers searching on different devices.

Online retailers Amazon and Target have developed sophisticated customer-oriented websites that make it easier to find what you need and opt for faster delivery options. 

To keep up with these retail heavyweights, leverage various digital channels to provide a more seamless retail experience. Brands should also combine physical stores with the latest digital and technical advancements like these:

Make Your Customers’ Lives Easier

Create QR codes and share them wherever your customers are, in-store and online so customers can scan the code with their smartphones and gain quick access to your product info and offers.

Breathe New Life Into Customer Relationships 

Identify individual consumer preferences with AI. Then use that data to personalize content that speaks directly to consumer interests. For example, providing relevant product recommendations can make your customers feel recognized and valued.

Use Augmented Reality (AR) and Virtual Reality (VR)

There are many ways you can integrate AR and VR into the shopping experience. Using AR, create 3D visuals to help customers explore products in detail before making a purchase. With VR, launch a virtual store so customers can browse from the comfort of their own homes.

Gear up to give your customers an amazing experience: Surprise your customers with exclusive offers, discounts and loyalty perks through your mobile app.

Personalize Every Consumer Interaction 

Your customer interactions should be customized to each channel, whether it’s email marketing, social media or another digital channel.  

For example, email helps you increase revenue with existing customers. Email offers an incredible ROI, $42 return on every dollar. But, your email marketing is most effective when you personalize it. 

You can do this by looking at first-party customer data. One way would be to look at a customer’s past purchases and recommend refills or related products. Another option is to include products they’ve viewed but didn’t buy. In other words, you’re showing them the products they’re most likely to be interested in buying. 

How Retailers Can Exceed Consumer Expectations

Consumer expectations might seem like a challenge for retailers. By following these seven tips, you can meet and exceed those expectations. When you do, your customers are more likely to come back and even become brand advocates who help grow your business. To learn more about how Goodway helps brands adapt to consumer behavior and leverage it in marketing, contact us.