While online channels are booming, brick-and-mortar shops are still wholly relevant for so many retailers today. However, getting the formula right to prevent churn depends on understanding exactly what consumers want in an ideal live shopping experience.
Resonate.cx is a world-class management platform specializing in customer experience. Resonate’s latest market research includes crucial information on what consumers are looking for in 2023 and what could cause them to spurn your shop and never return.
Potential churners to be aware of
1. Sloppy customer service & bad employee attitudes can be terrible for business
In Resonate’s research report, “The Current State of Brick-and-Mortar Retail Customers”, the number one factor causing churn for brick-and-mortar stores was identified as customer service. Consumers across all age groups agreed that encountering bad employee attitudes or inattentive service was enough to make them reconsider purchases, leave that store and look for an alternative store or online channel, or bring their custom to another retailer altogether.
This makes perfect sense as one of the top reasons consumers gave for visiting physical stores is receiving good recommendations and experiencing positive service from helpful staff. On average, 23% of respondents said this would keep them coming back to a store. But when they don’t find the service they’re looking for, it can be one of the biggest causes of churn there is.
2. Limited stock can force customers to shop elsewhere
The biggest benefit identified by consumers in choosing a brick-and-mortar store over an online one is stock availability. What consumers are saying they want is two-fold.
First, they want the opportunity to be able to see and touch the product they’re looking for, with a variety of sizes, colors, and styles. They want to try on or test out these products in a way that online shopping simply doesn’t allow.
At the same time, they want to be able to walk out of the shop with the product in hand rather than waiting for a delivery. This immediate gratification is the top reason why 7 out of 10 shoppers come to physical stores.
Clearly, then, it’s crucial to keep stock available or risk churn. Over 50% of customers reported that having the products they want readily available at the store will keep them coming back, and you can be sure that the opposite is also true.
3. Product pricing must be competitive
Competitive pricing has been identified by all age groups in Resonate.cx’s study as an important factor in their shopping experiences. This becomes more important as we look at older cohorts, especially over-54-year-olds with middle-income levels. A full 36% of these older shoppers indicated that good prices would make them recommend a store, and this is still roughly 30% for younger cohorts.
In-person shoppers are also looking to save on shipping costs, as the study suggests. Nearly 50% of respondents said that avoiding shipping costs was second only to getting their item immediately as a reason to go to a physical store. But when they find prices aren’t competitive with other retailers, this becomes a main reason to bring their custom elsewhere.
In-store churn prevention strategy
What do these retail trends mean for your business?
If your brand or business is running a brick-and-mortar store instead of or in addition to an online sales channel, understanding the latest retail trends is paramount. These trends give us important insight into what customers are looking for in an ideal retail experience, but they also let us know what will turn your customers away and possibly make it so they never set foot in your shop again.
1. Implement great customer service for the best customer experience
Want to keep customers coming back to your store? It turns out that while good service doesn’t necessarily attract customers to your store or make them stay longer, bad service has a major effect on whether they come back or not. Bad attitudes in the staff and poor service are the 2 biggest factors that cause churn.
Poor service can take many forms.
From a poorly designed, unattractive, or even smelly shop to insufficient staff to long and unnecessary waits, bad service is a leading cause of why customers walk out the door and don’t come back. Up to 12% of respondents said they would change their minds and not make a purchase due to poor service.
Even more damaging is bad staff attitudes or rude behaviour.
Staff or management mistreating customers, speaking to them inappropriately, being overly pushy, or being inattentive can really deal a blow to your business. This can lead to churn, with many customers leaving the store and many abandoning your brand altogether. This is especially significant as the age of your customer base increases. More than half of older customers (54+) reported that they would abandon a business and never come back after such a negative experience. While younger customers have more brand loyalty, we’re still looking at 27% of 18-34-year-olds and 35% of 35-54-year-olds who said they’d switch businesses.
It becomes clear that for brick-and-mortar stores, great service is paramount. Your staff needs to be well-trained, attentive, and courteous, and there needs to be enough of them to ensure a positive customer experience.
2. Keep products in stock for instant gratification and reduced customer churn
When asked why they would choose in-person or online shopping, an overwhelming 69% of respondents reported that they do so because they can take their purchases away with them. This instant gratification is key to understanding why brick-and-mortar stores still work in the current marketplace. Another 48% wanted to experience the product in person, trying on or testing their purchases before buying. A further 22% gave the related answer of in-person shopping to reduce the risk of disappointing returns.
All of these factors are directly related to keeping products in stock.
Half of your customers specifically come into your physical store to try and test out products, and well over 2/3 of them expect to walk out with their products of choice in hand. If they can’t do one of both of these things because the items they’re looking for are not in stock, there becomes very little practical advantage to shopping in person. Instead, the negatives of spending time and energy getting to your retail location will outweigh the benefits.
These days, about two-thirds of young and middle-aged customers do at least some research on the products they intend to buy. However, this research is supplemented by directly experiencing the product in person. Nearly 50% of younger consumers and 60% of older ones go to shops expressly because they expect a broad range of products to be in stock and available. If they take the time to conduct research and then visit a retail location to experience a product and it’s not available, this leads to disappointment and churn.
3. Keep in-store prices competitive to keep your customers happy
Only about a third of shoppers visit retail stores because of exclusive promotions. But nearly half report going into stores to avoid shipping fees, and this can be expected to apply most specifically to larger or pricier items.
However, maintaining brick-and-mortar locations can be expensive. These expenses result in much higher product prices for the consumer, and they may reject the idea of shopping at your store or in person in general. In fact, 17% of respondents said they would abandon the in-person shopping experience and replace it with online shopping with the same business. But 36% might abandon your brand altogether if the customer experience wasn’t positive, and that includes products being overpriced.
Know how to prevent churn
Churn is a massive issue for so many brick-and-mortar stores, with a poor customer experience leading consumers to leave your store and never look back. But by keeping products competitively priced and in stock and by ensuring good service in your store, you can keep customers happy so they’ll keep coming back.
For more insight into how to avoid churn at your shop and improve your customer experience, read more Resonate.cx or download the full report on churn here.
