Is Your Retail Business Ready for the Switching Economy?

the switching economy

Technological change is affecting the retail industry dramatically — and one area it’s transforming is customer expectations. Today, consumers are 29 percent more likely to switch companies than they were five years ago, reports Accenture’s latest Global Consumer Pulse Research. It seems that the ability to buy from anywhere, anytime, on any device has caused customer expectations to rise — so much so, that most businesses can’t keep up.

Accenture dubs this the Switching Economy, and reports that some $1.6 trillion in sales is up for grabs due to changes in consumer spending patterns and switching rates. While the study wasn’t specifically retail-focused, it has some important lessons for retail businesses of all sizes.

Don’t Get Complacent

More than half (56 percent) of consumers in the study say the number of brands they consider has increased significantly in the past 10 years. Whether or not your retail store also has an eCommerce component, it’s all too easy for shoppers to quickly compare you to the competition (both online and offline) with a tap of their smartphones. To stand out in this Switching Economy, you’ve got to offer something unique.

Get Personal

Today, personalization trumps loyalty, with consumers more likely to switch to businesses that offer product suggestions, experiences or service tailored to them. There are a variety of digital loyalty apps available for small businesses that can help you track your customers’ preferences to provide personalized offers, suggestions and even greetings when they come into your store.

Align Your Online and Offline Experience

Customers in the survey got annoyed when reality didn’t match their expectations.

One thing they expect is integration between digital and physical channels. If you sell products on your website, for example, make sure they can be returned in-store. Even if you don’t sell products online, it’s important to make sure your store’s website is up-to-date, easy-to-use and helpful.

If your site has outdated business hours or no phone number to call the store, you’re practically asking customers to switch to the competition.

Know What Customers Want

For big and small retailers alike, the right product mix is critical to success.

Conduct regular customer surveys to learn what customers want more of and less of, what they like and don’t like. Also poll them about customer service interactions and expectations.

Online survey tools make it easy to get the skinny from customers, and you can entice them to complete surveys with opportunities to win prizes.

Seize Opportunity

Consumers’ propensity to switch means you have the chance to grab business from your competition.

Keep a close eye on what they’re doing by visiting their locations, watching their social media accounts and monitoring their marketing campaigns. What are their weak points? What do customers want that they aren’t offering (and you can provide)?

Show their customers the benefits in switching to your shop, and you can win them over.

Win ‘em Back

If you’ve already lost customers to the switching economy, all is not lost. More than one-fourth of consumers in the study say they’d consider returning to a previous company. What would convince them to come back? Attractive pricing (56 percent) and a superior product (47 percent) win the game.

Play your cards right, and you won’t want to fight the Switching Economy because you’ll benefit from it.

Smartphone Photo via Shutterstock

Rieva Lesonsky Rieva Lesonsky is a Columnist for Small Business Trends covering employment, retail trends and women in business. She is CEO of GrowBiz Media, a media company that helps entrepreneurs start and grow their businesses. Visit her blog, SmallBizDaily, to get the scoop on business trends and free TrendCast reports.