4 Ways to Build Competitive Advantage Through Customer Loyalty

When it comes to digital enablement, today’s retailers have to work hard to distinguish themselves. In an ocean of online retailers, most of which provide the same basic functional capabilities, customer loyalty seems almost fleeting. Yet building and retaining customer loyalty can be key to a modern retailer staying competitive.

Building a competitive advantage means providing an experience that goes beyond the basic "table stakes" - convenience, low price, and on-time shipping. It means delivering a frictionless, delightful experience that builds customer trust and heightens their expectations of what a digital shopping experience should be. In short, an experience that gives shoppers every reason to come back again and again—and they will.

Let’s take a look at some interesting ways a retailer can go beyond the basics and build a competitive advantage by providing premium experiences that promote customer loyalty.

Provide smarter personalized recommendations

Almost every shopper is familiar with “recommended for you” and “other shoppers also bought…” recommendations that online retailers present them. Some e-commerce sites even periodically send emails with offers for products related to items the customer has viewed or purchased before. Such basic recommendations are expected these days, but rarely are they the results of more than the simplest matching algorithms.

Retailers need to generate smarter recommendations, based on actual user behaviors like previous selections and orders as well as more subtle factors. For example, JBS Custom Software Solutions recently collaborated with a client to implement a Market Basket Analysis which discovers co-occurrence relationships among a shopper’s activities. The solution then applies an association rule-based statistical model to the cart and basket data. Using intelligently grouped categories of products, as well as analytics on hundreds of thousands of purchases, the recommendation engine determines exactly the right “extras” to offer each customer based on how likely they would be to add it to their cart.

Smart, personalized recommendations not only resonate with individual customers and increase the retailer’s chance for add-on sales - they also build customer loyalty.

Provide more information / transparency to buyers

As we said before, there are some table stakes a retailer simply must provide if they are to keep the shopper on their website or using their app. Often, though, what can give retailers a real edge isn’t so much whiz-bang features, but simply relevant information. More than basic information about the products you offer, this should include insights into the purchasing process itself.

For example, detailed specs and reviews on a particular flat-screen TV aren’t hard to find online—although you should definitely provide them if you’re selling that model. Whether the item is in stock should also be prominently displayed. (A simple “In-Stock—Ships Today!” can increase the chance they will add the item to their cart.)

But how does this TV compare to others, not just in specs but in customer satisfaction? How many units are available, where are they, how soon can they ship and arrive at the customer’s home? Is local pickup available—and if so, at which locations? If the item isn’t currently available, offer to notify them when it is back in stock—or do it automatically. Clear, simple communication of information is key to a premium, frustration-free e-commerce experience. It makes customers feel in control and well cared for.

Empower your entire staff to provide the best possible experience

When was the last time you had an issue with a retail purchase and the employee you dealt with had no authority to make it right? Whether you were stuck on the phone (or in a line), being passed from one person to the next, then to a supervisor, the result was the same. Even if you eventually got a resolution, you told yourself, “That’s the last time they get my business.” And it probably was—you could take your business elsewhere.

This isn’t about technology, it’s about people and processes. When customers expect near-instant gratification, retailers can’t afford to make them wait to make a product return, to request special circumstances, to request additional information, for anything. By breaking down rigid hierarchical structures and decentralizing decision-making, retailers can empower their employees to take ownership of customer issues to everyone’s satisfaction. Instead of referring customers to a supervisor, retailers can arm their associates with tools that provide smart product recommendations, detailed product information and inventory availability. Customers get a better experience and shorter wait times. As a result, a situation that might have erased a customer’s loyalty instead improves it.

Of course, this requires the staff to understand a few new guidelines as much as it requires relaxing the rigid approval process. Assuming risk and responsibility for actions taken becomes every employee’s responsibility. However, most employees take this added responsibility as a sign of confidence by their management, and they pass that positive feeling on to the customers they serve.

As companies like Apple would attest, allowing retail sales floor staff to resolve customer issues with minimal wait and bureaucracy builds enormous customer loyalty—and is as big a competitive advantage as the products they sell.

Find the balance between human touch and automation

Finally, smart retailers understand the need for automating manual processes. Although the gains in efficiency, accuracy, and cost savings may outweigh the loss of personal service in some cases, even when a pandemic has forced us to limit personal contact to a minimum, balance is required.

While today’s shoppers love the feeling of control they get from digitally enabled shopping, sometimes we just want a real person responding to our needs and inquiries. That’s not to say that technology solutions—like our efficient, near contactless curbside pickup—don’t produce highly satisfied, loyal customers while helping them stay healthy. They can, and they do, but even these solutions rely on a careful balance between automation and the all-important human touch.

What if that item on your online grocery order isn’t in stock at the store filling the order? Do you want the personal shopper to delete it, pick something else, or message you—right within the app!—to find out what you want to do? When you need assistance, is a chatbot enough or should the retailer provide 24/7 live chat or a good old-fashioned phone line? If a customer does get routed to a live operator, you want to make sure the CSR immediately has the details they need to resolve the issue in the shortest possible call time. This means using the customer’s phone number and any previously entered data to identify them, making resolution streamlined and seamless. And of course, who doesn’t want to see a smiling, friendly face (possibly covered by a mask) bringing your curbside pickup order to your car? The key is to make the experience as efficient as possible, while still making it as enjoyable as possible for the customer.

Is your e-commerce solution boosting customer loyalty and building a competitive advantage for you? JBS Solutions has years of experience implementing efficient, full-featured solutions for multi-billion-dollar retail environments. Contact us for a free half-day assessment to find out how we can help deliver on your business goals while greatly reducing your time to market.