E-retailers need to 'fight smarter' for customer loyalty

WM Circle Logo

By: Wise Marketer Staff |

Posted on April 16, 2009

Online retailers will have to fight a lot harder and communicate with consumers in increasingly smarter ways if they are to differentiate themselves from their competitors, encourage customer loyalty, and increase repeat purchases, according to a research report by Verdict Research, commissioned by Hybris.

The report, entitled 'Key Challenges in E-Retail', suggests that blanket mass marketing campaigns are no longer applicable in a world where the percentage of consumers who go back to web sites because of good communication and marketing has risen from 8% in 2002 (representing a combined spend of 31 million in the UK alone) to 15% in 2008 (with a combined spend of 291.8 million in the UK).

As mainstream High Street retailers are joined by more and more pure-play internet retailers, as well as small niche specialists and international players, and even individuals selling products via marketplaces such as eBay, online retailers can no longer simply launch a web site and wait for customers to turn up and spend money. Indeed, a key strategy will be to attract and retain customers using highly targeted, personalised, relevant, and focused marketing techniques.

In the report, entitled 'Communication & Integration', Verdict suggests that the quality of communication with customers is much more important than the quantity. The internet might make mass-mailing simple and low-cost, but consumers increasingly demand that marketing messages must be highly relevant and have some kind of 'added value', interest or benefit.

Retail stores and web sites can be used to support each other, the report argues. For example, in-store marketing can be used to direct customers to the web site, while the online channel can be used to stimulate offline purchasing. In-store kiosks enable stores to introduce customers to the online shopping experience and allow them to view wider product ranges and access more information at the same time. At the same time, 'click-and-collect' services can offer customers far greater convenience by allowing them to order online and collect in-store when it suits them.

According to James Flower, senior consultant for Verdict, "It is important to remember that integration needs to occur in every facet of the business, not just on the customer side of retailing. The internet sales channel must be integrated with stock, pricing and other management systems, and management must be able to understand each channel in the context of the whole business by using similar metrics for online and in-store operations."

Ariel Ludi, CEO for Hybris Group, concluded: "The ability for retailers to streamline their product and pricing information, combined with personalised marketing and communications, will be critical to differentiation as competition reaches an all time high."

A free white paper covering the need for smarter marketing and communications across retail channels has been made available for download - click here (PDF document; no registration needed).

More Info: