Large retailers now have a great opportunity to expand and improve their relationship with consumers through an omni channel focus on customer relationships to increase consumer loyalty through improved focus on relationships. One distinct advantage of the small and local retailer is the direct relationship they are able to develop with their customers. This relationship provides a compelling reason for customers to return for the social interaction. Extending the omni channel to focus on the relationship with consumers now provides a vehicle for large retailers to engage with their customers on a more personal level. This personal engagement will allow the larger retailer to develop a stronger personal relationship with their customers to develop the same compelling reason for customers to return that is now enjoyed by the small and local retailers.
Large retailers lost this relationship as a result of growth and a single minded focus on profits and sales increases. These large retailers focused on the transactional aspect of the purchase rather than the consumer experience and most importantly the relationship with the consumer. This transactional focus by the large retailers worked well for quite a while however a key result is that the consumer relationship was ignored. This focus on transactions and down playing of the relationship created the current environment for large retailers where the customer is focused on the transaction and demands the lowest cost transaction. Consumers have incorporated the expanded search and shopping capabilities provided by the Internet and mobile technology to allow them to purchase at the lowest price, without regard for relationship, any time and from any place.
This consumer demand and focus on price is really the result of the large retailer’s focus on the transactional purchase. Consumer have incorporate omni channel purchasing capabilities with mobile technology and apps offered by third party developers to take complete advantage of the ability to identify and then purchase at the lowest cost. This is a key and also unanticipated result of the retailer focus on cost, the retailers have trained their customers to focus on cost at the loss of loyalty. Even loyalty programs are only another way to notify customers of sales and special offers, this is simply another vehicle to enforce and encourage a focus on cost.
Large retailers have very long and difficult challenge ahead of them to turn the consumer focus on cost to a focus on their relationship with the retailer. Retailers must refocus their interactions with consumers to a relationship focus rather than a transactional relationship. The good news is that the retail omni channel capabilities provide the retailer with the tools to focus on the relationship across all interactions with their customers. The bad news is that this will require the retailer to heavily invest from a time and resource perspective to develop loyalty through relationships because the retailer must retrain the consumers to focus on the positive and long term benefits of the relationship with the retailer.
And now for the audience participation portion of the show…
ECommerce will have wide ranging impacts on both the retail and manufacturing sectors. How can you focus these abilities to improve the consumer's experience? Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes. In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas. How can you support these continuously changing requirements?