Learn How Consumers Engage In-Stores vs. Online
What is consumer engagement?
In its simplest term, consumer engagement is the ongoing interaction between a brand and the consumer. It is the outcome of one-to-many positive experiences. Consumer engagement is a choice made by the consumer to continue a continuing relationship with the brand.
Why is consumer engagement important?
Consumer engagement is important because it helps promote an emotional connection between the consumer and your brand. It is something that happens before, during, and goes way beyond the cash register or checkout screen. It makes your customer feel like they are not just another purchase — but a member of your brand.
A dedicated customer that keeps coming back to your business means that you have created a loyal consumer. When a consumer is loyal to a brand, they will make sure to vouch for your business to others. When an undecided person is choosing between many businesses, they can easily be influenced by a glowing recommendation from a friend. 92% of people said they are more likely to trust a word-of-mouth recommendation over advertising.
Retention and Loyalty
Consumer engagement is imperative for consumer retention. Studies show that there can be a 25%-9% profit escalation with just a 5% consumer retention increase. Loyal brand members will be more willing to try out other products or services you have. When you know your customer, it is easier to recommend things tailored to their preferences. Overall, it will be easier to cross and upsell.
Consumer interaction is important because it is a great way to get feedback. Positive and negative feedback is essential for the growth of your business. It is hard to know what works and what doesn’t if you never talk to your customers about your products or services. A feature you think is great might be a chore for someone else.
Shopping Then and Now
A lot has changed in the way we shop these days. It is good to take a good look back at how things used to be like. Here are some comparisons:
Then: In the past, information was not as widely available as it was now. If you wanted to know about a product, your best resource was talking to the salesperson yourself. They were considered the experts and had a big influence on a consumer’s purchase.
Now: The consumer has the accessibility to do their own research via a multitude of e-commerce websites. They will have likely already looked up reviews on the product before coming in to buy it.
Then: Hearing about someone’s real opinion on a product was mainly spread by word of mouth.
Now: Opinions are still spread by word of mouth but on an immensely larger scale. People can share their honest opinions on the internet, so anyone all over the world can see it.
Then: There was no luck if a store was out of stock. It was tedious and difficult to check other store’s locations. You would have to drive a town or two over and hope that they had it in stock.
Now: It’s a breeze to check a product’s availability in another store by remotely accessing their inventory. Also, the product can be looked up online to check the availability. Taking it a step further, a notification can even be sent to you when the item is back in stock.
Then: Cash was the main method for payment. Checks weren’t looked at as weird and credit cards were used, but they were still on the rise.
Now: Although “cash is king”, card and mobile payments have taken the modern-day by storm. 80% of people prefer to pay using their debit or credit card over cash. Also, the number of people using mobile payments is increasing each year, so cash is more of a hassle to the younger generation. I mean, pennies have been being phase-out in Canada since 2013.
Then: There were dedicated cashiers and checkout lines
Now: Self-checkout is an option for those who choose not to interact with the cashiers (and sometimes the line is faster.) There are even stores now that only require an app to open and skip the checkout process altogether.
Then: There were more “mom and pop stores”. Stores were family-owned and run. It was far easier to create relationships with your consumers because they came from the neighborhood.
Now: Chain and department stores are prevalent. Mom and pop stores are at risk when the rent gets too steep or a financially damaging crisis happens.
Then: Ads were untargeted. The demographic would be chosen by the marketers and then the ads would be sent out. Hopefully, they would work out.
Now: Doesn’t it feel like your smartphone is always listening? Today, ads based on phone and internet usage are targeted to the everyday consumer.
Pros and Cons of In-Store Shopping
Being able to take a trip somewhere for something can be the best (or worst) part of your day. When it comes to shopping at a physical location, it comes with its own pros and cons.
- The social aspect- shopping with others.
- No shipping or return costs.
- Instant gratification.
- Real-time customer service.
- More secure checkout methods.
- Being able to touch and try out the product.
- In-store only sales.
- Returns are less likely because they’ve seen the product in person.
- Being able to highlight certain products on display.
- More impulse purchases.
- “The Target Effect”.
- Easier to create a relationship or connection.
- The ability to set the tone/mood.
- Limited stock.
- Long lines and crowding during peak hours/holidays.
- Dealing with parking and bad drivers.
- Spending money on gas.
- Open during limited hours.
- Health concerns during the sick seasons.
- Pushy or rude/unhelpful consumer service reps.
- Fake sales.
- Social interaction (if you don’t feel like it).
- Physical stores can be expensive to maintain for the business.
Pros and Cons of Online Shopping
- Available 24/7.
- Being able to find the best deals and coupons.
- Saves time.
- Easy price and product comparison.
- No worries about parking, gas, long lines, crowds, and bad drivers.
- No pushy salespeople.
- Global variety of products available to browse and buy.
- Ability to instantly read reviews before buying.
- More payment options available.
- Online only deals.
- Cheaper to maintain than a physical store.
- Ability to connect with a large audience.
- Easier to collect consumer data.
Online Store CONS
- Can’t physically touch or try the product.
- Shipping costs.
- Having to wait for delivery.
- Dealing with a lost or stolen package.
- Product not being as pictured.
- Some sites might not be accessible to people with disabilities or impairments.
- Having to wait to get in touch with customer service.
- Privacy and security concerns.
- Packaging waste is harmful to the environment.
- Hard to shop with bad or no internet.
- Potential of website crashing.
- Potential hackers can take a website offline.
In-person vs. Online: Who Wins?
Head-to-head, each shopping method has its own pros and cons, so it can’t be said that one outshines the other. It is more cost-effective to start out with an online shop when launching a business. With an online shop, it is more cost-effective. It can help you feel out your consumers, navigate through issues and learn from feedback.
Although online stores have become more popular, consumers still enjoy the experience of being present in a physical store. In addition, about 80% of consumers said they will go out to the store when they immediately need or want to buy a product.
Having both an online presence and a brick-and-mortar store can be beneficial to your business. They go not against each other, but hand in hand. With this being said:
61% of consumers prefer a brand with both physical and online stores. Also, 51% of shoppers with smartphones are more likely to use the store’s app when shopping to rack up rewards.
However, it is also important to look at who is buying where. By the looks of it, it’s not hard to believe that the younger the generation, the more likely they prefer to shop online:
Starting with the youngest generation, a little over half of Gen Xers at 56% preferred to shop online than in-store.
The next generation most prefers online shopping — Millenials at 67%.
Then we get a little decline at 41% for Baby Boomers. And lastly, 28% of the Silent Generation.
Next, let’s look at what makes shoppers say “no way” for each shopping method:
The biggest turn-off for 50% of online shoppers is the extra costs at the checkout page.
The biggest turn-off for about 60 % of in-store shoppers is the overall cleanliness of the store.
This goes to show that even though the way people shop has changed, there are still high customer expectations to uphold.
Increase In-Store Engagement
You want to create an experience a shopper can only have at the store itself. Below are a handful of in-store customer engagement strategies:
- Use interactive and intriguing displays
- Run in-store events (ie. pop-ups, food drives, workshops, or Santa photos)
- Have kiosks or tablets available to input information
- In-store mobile app sales
- Loyalty Programs
- Offer free in-store WIFI
- Offer text alerts to keep consumers updated
- Understand how consumers navigate your store and arrange accordingly
Increase Online Engagement
Online engagement is even more important because you can reach your customers after they’ve already gone home or closed your site. Below are some effective ways that engage customers online:
- Create a newsletter.
- Request customer feedback.
- Loyalty Programs.
- Live chat and chatbots to help answer questions.
- Make thoughtful and interactive social media posts.
- Create informative videos.
- Make exclusive coupon codes.
- Share user-generated content from social media.
- Respond to engagement.
- Focus on structured data and ways of reach customers via voice-activated devices like Alexa and Google Home.
All in all, improving customer engagement is a key element to keeping loyal customers. Even so, it is easier for long-term engagement to continue with the addition of online and social media elements. With this being said, brand content should be relevant, thoughtful, and consistent. The customer journey doesn’t end with the purchase.
What are you willing to do to strengthen your brand’s relationship with its customers?