This article is part of Raydiant’s Consumer Behavior series which interviews top industry experts to better understand the effects that the COVID-19 pandemic is having on consumers, how businesses can adapt to these changes and how it will shape shopping experiences in the future.
The following is an interview we had with Zsuzsa Kecsmar, CCO and Co-founder at Antavo.
How has consumer behavior evolved over the past 5 years?
ZK: Over the years, shopping became more and more about the experience, not just the transaction itself. Modern customers might come for a discount or a good deal, but they stick for the memorable shopping journey. Failing to meet these expectations will mean they switch to a competitor in a heartbeat, which creates the false myth that ‘there’s no customer loyalty’. Customer retention solutions such as loyalty programs combat this by building an emotional connection with customers by engaging customers outside of the buying cycle, personalizing the communication, adding gamification elements to the journey, and offering early access through VIP clubs.
What are the biggest consumer behavioral changes you’re seeing due to COVID-19?
ZK: COVID-19 has significantly changed the customer reality. First, it created ‘Home Hubs’, where people managed their daily business from the safety of their home, including shopping. Secondly ‘Crisis Spend’ has emerged, as people restricted shopping to the essentials: food, medicine, hygiene supplies and other functional products. The last prominent trend is ‘Share & Care’, showing an increased interest in supporting humanitarian causes. ‘Crisis Spend’ is already easing, but the other two will have a long-lasting impact on the industry: a large number of customers were introduced to online shopping, and people will remember which brands were there for them during the crisis.
How can brick and mortar retailers adapt to these changes?
ZK: Brick and mortar retailers need to realize that the Coronavirus has changed the customer reality forever, and there’s no point in returning back to ‘normal’. Instead, they should focus on reinventing their store space and adapt to Retail 2.0. Among others, this means that stores need to be more configurable, so the staff can change or add new equipment to swiftly answer any changes if the situation calls for it. We just published a guide about how a next-gen retail loyalty program can also provide an edge. Other than incentivizing the purchase, a reward system also builds credibility for the brand if it allows customers to donate points for charity, for instance.
What behavior trends should retailers be focused on?
ZK: Today’s customers crave novelty more than anything. When they enter their favorite store, they expect a new kind of impulse every time. A loyalty program with surprise & delight elements is a great way to satisfy their need. By utilizing receipt scanning or putting unique QR codes in small sachets that are attached to the product, customers can experience a thrill, as they are rushing to redeem their offer to discover what kind of mystery reward they unlocked. And the best thing in all of this is that by doing so, they identify themselves as in-store customers, making your single customer view even more complete.
What will the consumer shopper of the future look like?
ZK: The way I see it, future customers will go to a retail store to try out the products. Therefore brick-and-mortars will evolve into showrooms, where people can interact with the products in a professional environment, then go home and order it from the brand. Nike already does this in its flagship store, allowing customers to hit the treadmill in the store, wearing the latest sneakers, while receiving lifestyle advice from a personal trainer. Stores will also feature more high-tech equipment. NFC technology, facial recognition, engagement kiosks, smart mirrors, POS devices at the counter which can scan mobile passes these will all become common — and they’ll also be a huge help to bringing the loyalty experience from the cloud down to the store.