How to Engage Customers in Retail - Our Top Recommendations

The retail industry is becoming more competitive. Hundreds if not thousands of brands are fighting for a few seconds of attention from very selective customers. The challenges of today are not related to the quality of a product, but more so on the ability to build a strong and engaged fan base.

This is the group of people that generates that majority of a company’s revenue. It is the segment of your customers that offers the best (free) form of advertising. It is the people that support your brand in the long term through repeat purchases.

But how can you attract such “golden customers”? What makes them chose your brand over others?

In this article, we show you how to engage customers in retail and share some of the best methods to create an army of loyal customers. Let's dig in!

Contents

• How to engage customers in retail - 5 Best Methods
• (1) Co-creation
• (2) Loyalty programs
• (3) Utilize communication channels
• (4) Focus on building a relatable identity
• (5) Train your employees
• Summing up
• FAQ

How to engage customers in retail - 5 Best Methods

The following subchapters will analyse the different perspectives that can increase customer engagement. Keep on reading to find out what makes each option important for your business and how to apply them successfully.

1. Co-creation

Co-creation refers to the collaborative effort of brand and customer to create new value. This often takes the form of new products or improved experiences, bridging the gap between the two parties. In time, this joint effort helps brands become more relatable.

For example, an Adidas store in Portland recently started creating limited editions of sneakers based on designs of local creatives. The project was so successful that adidas decided to continue co-creating customer-inspired shoes that concur with numerous cultural and sports events in North America.

How to engage customers in retail using co-creation:

• Deploy email marketing campaigns containing surveys that aim to improve your products and services. You can build such surveys on software tools like Mailchimp or send a simple Google form. 
• Create polls on your Instagram stories and have customers decide on new product collections. For example, you could offer two variations of a design and have customers pick their favourite.
• Create products in collaboration with influencers that are popular with particular segments of your target audience. To get inspired, read the story of Ninja X adidas and K-SWISS X GARY VEE.
• Be open to feedback and complains with regards to your offer and make sure to address issues and implement the changes. 

2. Loyalty programs

The concept of loyalty programs has evolved massively over the years, especially when looking at younger generations. Companies are constantly improving their offer to retain as many customers as possible. By rewarding loyal customers and turning shopping into a game, loyalty programs are able to strengthen the bond between brand and customer, improving engagement along the way.

How to engage customers through loyalty programs:

• Start by looking into the most successful loyalty programs to get ideas.
• Consider using a retail-focused CRM software to collect and analyse customer data.
• Create a reward system that offers real value and resonates with the target audience.
• To enrich your loyalty program, consider building “in-store” experiences that make your customers feel special. This can be done both in physical stores (e.g. VIP treatment) as well as e commerce stores (e.g. access to exclusive collections and special rewards).
• Be mindful of the issues that could turn brand loyalty into a problem.

3. Utilize communication channels

An increasing number of retail stores are taking their business online to stay in touch with their customers. Apart from creating e commerce stores, these businesses also invest heavily in the development of a digital identity (more on this below), which is presented through different communication channels, like email, Facebook, Instagram, Twitter, and others.

Building a digital presence is essential as it affects your customer’s decision-making process, word of mouth promotion and whether or not they choose to make repeat purchasing.

A Trustpilot study on 2000 retail customers found that 20% of people people will first check a brand’s social media channels before buying their products, while 3 out of 4 decision-makers of B2B brands are influenced by information they find on their social networks. 

How to build your communication channels:

• After defining your target audience, choose one or more communication channels to engage with your audience. To find out what works best, you can start out with an omni-channel approach and later define and grow the channels that drive most organic traffic to your website. 
• To determine which options perform better, you will need to compare the Click Through Rate (CTR) on different communication channels. This data can be collected by adding UTM parameters to the Call to Action (CTA) links placed in posts and tracking them with Google Analytics.
• Once you define the best performing channels, you will need to build a strategy. This will mainly be the role of a Social media manager and/or an Email marketing specialist. If your brand is mainly operating in a specific area, consider localizing the strategy.
• According to a recent survey, retail brands tend to prioritize email and text messages as the main communication channels. While these may not work for everyone they are definitely worth exploring further.

4. Focus on building a relatable identity

Brand identity is the way in which a business presents itself to the public. An identity can be built through both tangible and intangible criteria, like brand values, supporting causes, product design, advertising, etc. 

Here is an interesting example. Back in 2005, the marketers of Coca Cola found that the majority of customers that bought Cola Light was female. In order to attract male audience as well, the company decided to create Coca Cola Zero. The product’s advertisements attempt to frame the drink as a “boost to masculinity” rather than the “you are what you drink” slogan, often used to attract a female audience. This removes any potential gender contamination, making the product more approachable to men.

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How to build a relatable identity:

• Define your target group and any segments thereof. This is the most important step to help you understand your customer’s wishes and needs.
• With a clear idea of your ideal customer in mind, try to understand what they find important. This is where you decide how to position your brand or product, and it may be a good idea to elaborate your findings with the marketing strategies of your competitors.
• Finally, implement the decisions in your marketing strategy and use a variety of communication styles to test its effectiveness.

5. Train your employees

Regular employee trainings are very important for sales representatives and customer service agents. Their professional behaviour and problem-solving skills will determine whether or not customers are happy with their experience and feel ready to talk about it to their friends and family.

A recent study found that 3 out of 4 customers want to communicate with a human during their buying journey. If the person they engage with is knowledgeable and well-educated on the brand’s values and processes, the chances of repeat purchases will naturally increase.

How to educate your employees:

• Create an SOP document that outlines the best practises for each potential issue.
• Host quarterly or annual trainings for all employees that directly communicate with customers. The information in the trainings should reflect the brand’s identity and marketing goals.
• Consider using an internal communication channel like Slack or Whatsapp, to share feedback and ask questions.
• Allow your staff to express their ideas and concerns and help them build processes that offer them full autonomy.

Summing up

After reading this post, you should have a better idea of how to engage customers in retail. The methods we discussed have been used by some of the top brands worldwide, and are applicable to any retail business model. In short, here are the 5 recommendations you need to remember:

1. Co-creation - Create value through brand-customer collaboration.
2. Loyalty programs - Reward repeat customers and focus on community building.
3. Utilize communication channels - Share your message where your audience is lurking.
4. Build a relatable identity - Define a target group and adjust your image to their needs.
5. Train your employees - Build an army of knowledgeable workers with problem-solving skills.

From this point onwards, it is your turn to apply the lessons in this post. If you need any further inspiration, and to understand the true power of an engaged audience, consider reading Kevin Kelly’s 1000 true fans. The short essay is a great followup to this article and will certainly offer some additional engagement ideas.

Frequently Asked Questions

Engagement is a topic that is dynamic in nature, and changes frequently depending on trends and developments within a given industry and online shopping as a whole. In the following sections we will share some additional information to help you develop strong engagement strategies.

What are some uncommon customer engagement ideas in retail?

A retail trend we are currently observing is the decision of companies with a relatively new online presence to adopt an omnichannel approach, meaning that they choose to distribute their content across multiple social media platforms simultaneously. This is done in hopes of better understanding the target audience and the channels which are capable of bringing more engagement and traffic to the website.

Aside from multichannel testing and experimentation, we also see physical retail stores improving the customer journey by offering in-store experiences that lead to engagement, social sharing and improved brand awareness.

Are there tips on how to engage with customers in retail in a natural (organic) manner?

A quick and easy way to improve the “gap” between business and customers is to hire an employee that is able to step into the shoes of the customer. The employee should be part of the target audience and have extensive social media management skills, in order to test out creative ideas that can later be analysed for their effectiveness.

By natural or organic, we refer to communication that does not feel forced, formal or distant. The communication should allow customers to see the brand as a friend or a name they can possibly identify with. For that reason, this type of experimentation should be gradual and measured in a similar fashion. A once-off promotion will likely not yield results, as there is no gradual buildup of the relationship between the two parties. It is recommended that any engagement strategy is executed and measured for at least 3-6 months before adjustments are made.