THE CLARUS Blog

Building Customer Loyalty as Consumer Shopping Behavior Changes

COVID-19 has drastically changed how and where consumers shop.

And the reality is, for many, these changes could be permanent.

Whether it’s because of changes in their personal financial situations, their urgency for product delivery, limited inventory at their usual shopping destinations, or numerous other reasons, consumers are expanding where they make purchases.

As a result, this has presented an opportunity for retailers to introduce themselves and their respective brands to an entirely new group of potential long-term customers.

Due to this new shopping paradigm, here are some retail trends we’re seeing and some thoughts about how brands can build lasting loyalty with these new customers.

 

Ecommerce Trends Present New Opportunities for Retailers

While retail e-commerce has consistently grown significantly for many years (last year global e-commerce revenue rose 18% compared to 2018), it still comprises a small percentage of overall revenue (14%) when compared to brick and mortar shopping.

The current pandemic, however, has accelerated an already fast-growing shift to online shopping.

Since the COVID-19 outbreak, a recent survey indicates nearly three of four (73%) U.S. consumers have shopped for the first time with a new retailer.

And nearly one quarter (24%) of U.S. consumers have shopped with three or four new retailers. Nearly 60% of consumers have increased their online shopping, with Gen Z (65%) and Millennials (63%) leading the way.

Forty-four percent of consumers have shopped with a new retail brand because a product was unavailable at one of their usual retailers, or because the delivery of that product was going to be delayed for too long.

Also, a whopping 28% of consumers have moved away from Amazon as their preferred online shopping destination since Amazon’s shipping policies have changed, as they prioritize essential shipments.

Due to these eye-opening trends and statistics, this presents opportunities for retailers who can fulfill orders in a timely fashion, at a competitive price, with quality customer service, and compelling rewards and benefits.

 

How My Family Has Changed Its Shopping Habits

I want to share two personal examples of how our family has changed its online shopping behavior since mid-March.

While I have been a loyal customer of Fleet Feet running apparel and gear for many years, I hadn’t bought online from them until last month.

Fleet Feet’s in-store customer service is top-notch and they spend a great deal of time personally making sure your fit is perfect. Generally, I always want to try on running shoes, however, with the remaining cushion in my current shoes almost non-existent, it was definitely time to say goodbye. Because Fleet Feet’s pricing is competitive, it was well stocked with my desired product and they offered free and fast shipping (and returns if they didn’t fit right), I was comfortable making that first online purchase from them. And with its loyalty program offering strong rewards on my purchase, they delivered on everything I wanted and needed.

Additionally, I recently made my first purchase with another retailer, the direct-to-consumer brand Swanson Vitamins.

While looking to make purchases that I would have normally made in-store at a CVS or Walgreens, or online from Amazon or Walmart, I visited Swanson’s site and quickly realized that it had everything that our family needed in stock, at a great price, and ready to ship immediately.

That shopping experience makes it very likely I’ll be returning there for future purchases.

 

Seize the Day and Offer a Better Customer Experience

Opportunities exist to attract new customers to your brand and keep them if you have the inventory, can deliver in a timely and cost-effective (ideally free) manner, and you reward them for their loyalty.

Retailers need to examine…Does our brand offer our customers a compelling loyalty solution and benefits that will keep them coming back time and time again? A recently released 2020 Premium Loyalty Data Study from Clarus Commerce indicates the most valued benefits and perks that motivate consumers to join a premium loyalty program and shop more frequently with that brand are free shipping (66%), instant discounts on every purchase (60%), free giveaways (56%), faster shipping (47%), and surprise rewards (45%).

Since COVID-19 has impacted consumer online shopping behavior in a major way, retailers should think about what they can do to offer a better, seamless experience that can entice a new group of customers.

Consumers want things when they want them (usually immediately) and delivered at their convenience (ideally for free).

Retailers have a unique opportunity to seize the moment and step forward to claim new customers by providing exemplary customer experience and a compelling loyalty program.

Are You Ready to Go Premium?

If you want to become a 24/7 presence in your best customers' lives, it's time to get started.