Page 30 - December 2020 January 2021

RLI RETAIL INSIGHT

How to Rebuild

Customer Loyalty

In this month’s Industry Insight, Robert Flowers,
CEO of DivideBuy sits down and discusses the topic of
how retailers can rebuild loyalty with their customers
during Covid-19 and all of the effects it has had on
the retail industry this year.

he Covid-19 pandemic has greatly affected Building online convenience
consumer spending habits this year. The second While building loyalty online is a whole different ball game to
lockdown, like the first has forced consumers the high street, the need to offer convenience, via a frictionless
T to shop online instead of instore, which in-turn experience, should still be the key focus. This requires consistent
has meant a move away from cash payments to digital delivery of the attributes consumers care most about, such
payments. Holidays have been cancelled which has then lead as providing free deliveries and returns, quick page loading
to consumers using the money saved up to make purchases times, and short click journeys. Essentially, features that enable
they would not have otherwise made. The pandemic ended customers to get the products they want faster and with less
up having a great effect on how people buy, what they buy effort than ever before. One-click checkouts and next day
and where they buy it. deliveries are of high importance to customers and offer a
To help retailers better understand what has changed reason to remain loyal to a retailer.
and to support them in changing their priorities, Periscope In addition to this – and arguably most importantly – retailers
by McKinsey surveyed more than 2,500 consumers across should look at the choice they provide at the checkout.
the UK, the US, France, and Germany, both before and According to PPRO, 67 per cent of UK consumers have
during the first lockdown. abandoned an online retail site due to the payment process,
Results from the study were compiled in each country, whilst 22 per cent of these left because it was too complicated
with McKinsey discovering several significant trends: and 21 per cent left because their preferred payment option
wasn’t available.
1. More consumers are favouring online and omnichannel
retailers - the rules restricting how shoppers can WhaT opTions do consumers WanT?
purchase has seen many relying on online or All online retailers accept debit and credit cards, while the
multichannel services. majority have begun accepting some form of digital wallet. But
2. Consumers now associate retail convenience with one alternative payment method that is increasingly expected at
technology - many believe features such as contactless the checkout is Point of Sale (POS) finance. POS finance allows
payments, digital screens in-store, and augmented reality consumers to spread the cost of their payment, making purchases
are the key to creating the best retail experience. instantly more affordable and accessible. In fact, according to the
3. There has been a downturn in loyalty. This is particularly Citizens Financial Group, 76 per cent of consumers are more
true for UK retailers where 44 per cent of consumers likely to make a retail purchase if a payment plan backed by a
opted to make purchases with a new retailer between “simple and seamless Point of Sale experience” is available.
March and June this year. To win back consumer loyalty and gain more customers in the
process requires retailers to adopt new strategies to adapt to
The reason for The drop in loyalTy changing consumer behaviours. Consumers want choice and
Ultimately, the Covid-19 pandemic has changed consumer convenience – POS finance can provide both in spades.
priorities. Those who shopped mostly in-store, out of habit
or ease, suddenly had to move online and factors that made
customers loyal to brands changed. Factors such as competitive
pricing and stock levels became of greater importance, along
with how businesses responded to the pandemic.
For example, shoppers were particularly drawn to retailers
that supported their employees during the pandemic, such
as by increasing their wages, giving extra sick leave, or paying
employees for lost wages. Braze even found that 94 per cent of
UK shoppers would walk away from purchasing with a brand if
they do not agree with their response to Covid-19.
These attitudes highlight the need for retailers to offer genuine
support and value right now – whether that is with discounts,
delivery deals, employee care, sustainable products and services,
or personalised marketing. This is particularly important in a
digital environment since brands are not able to rely on passers-by
and attractive shopfronts to draw in potential customers.

30 RETAIL & LEISURE INTERNATIONAL DECEMBER 2020 / JANUARY 2021