COVID-19

What role does customer engagement play for retailers during a global pandemic?

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Lizzie Willett
Principal Consultant, Retail

The effects of Covid-19 are being felt by every retailer across the UK. While grocers struggle to keep up with demand and grapple with day-to-day operations, fashion and clothing retailers are attempting to shift stock and, as we discussed in last week’s vlogs, many are slashing prices in response to this.

While understanding better ways to engage your customers may seem like a low priority for some retailers, for others, it has never been so important. This article explores the different strategies retailers can use to improve their customer engagement efforts during a global pandemic such as Covid-19.

With engagement through physical channels pretty much obsolete, retailers are relying on digital to engage with their customers. Email and social are two channels that have been heavily utilised during the current pandemic, offering a way to connect directly with customers. Email open rates have increased by 25% on average since the UK went into lockdown, and are rising by between 5% and 10% every week.

Those retailers with an effective CRM strategy in-place have been on the front foot, with customer data already held and approaches well-established to communicate with customers. E-commerce retailers by nature tend to be better positioned by maintaining a more accurate view of their customer base. For these retailers, it’s more a case of adapting their current strategy, than reinventing and starting from the ground-up.

Bricks and mortar retailers, on the other hand, have found it more challenging – take Primark for example, who have been forced to shut all stores (and their only route to the UK market). With a lack of customer data, they have been limited in ways to communicate with their customers, aside from social media and mainstream advertising. This will naturally harm their market share, with Primark-loyal customers expected to flock to pureplay value retailers such as Missguided and Pretty Little Thing instead. The question is, will they return to Primark after this is all over?

Better engaging customers, personalising the approach and communicating with customers in a relevant way is proven to drive retail performance (80% of shoppers are more likely to buy from a company that offers personalised experiences.) So, what can retailers do to drive better customer engagement in times like these?

 

If you’ve got customer data, learn to utilise it, fast

It might be that you already hold customer data, but it’s what you do with it that matters. Particularly during a pandemic where customer needs evolve quickly, you must be able to understand these customer demands and pivot in response. If you’re not able to use your data to deliver insight and drive performance, it’s worth asking yourself if your existing (or perhaps non-existent) Analytics capability could be driving more for you.

 

Step up your content game

As many retailers flock to digital channels as the only way to get a customer’s attention, platforms suddenly feel crowded – try something different to spice up your content. Whether through collaborations or using new formats such as Instagram Live (or both – I particularly enjoyed Deliveroo’s Instagram Live Lunch with Lewis Capaldi) – try something new to differentiate yourself keep your followers engaged.

 

Get a little help from your friends…

… Of the social media platform and search engine variety. Sponsored adverts, in particular, are helpful in times such as these when you want to reach your target audience directly, and platforms such as Instagram and Facebook can help you do just that.

 

Reward your most loyal customers

Although the future is uncertain and maintaining margins is a huge priority, don’t forget to acknowledge and reward your most loyal (and valuable) customers. It doesn’t need to be monetary – it could be a simple thank you, or a future reward for continued purchases over the coming weeks or months.

In summary, engaging your customers is still essential, even in a pandemic. However, it must be relevant and appropriate to the retailer – what works for a fashion retailer will not work for a grocer, and vice versa. Getting the basics right is also key. If you struggle with basic ordering, fulfilment and delivery (as we have seen many retailers face in recent weeks), it doesn’t matter how well you connect with your customers – you’re unlikely to generate real engagement and long-term loyalty.
Look out for tomorrow’s article where we look at how some retailers have truly responded to customers wants and needs by innovating in the face of adversity and creating new routes to market.