Beat The Customer Churn In The Post-Pandemic World
The COVID-19 pandemic has caused a seismic shift in the global retail sector. With supply lines facing disruptions, lockdowns becoming the norm, and customers preferring to do their shopping from the safety and comfort of their homes, online retail channels have seen an enormous surge in usage and revenue. This acceleration towards a digital future has been so pronounced that data from IBM’s U.S. Retail Index indicates that the pandemic has quickened the shift away from physical stores to online shopping by roughly five years, with e-commerce estimated to have grown by 20 per cent this year alone.
Naturally, these shifting tides have forced brands to follow suit. Businesses that have traditionally relied on a brick-and-mortar model have understandably been the hardest hit, being compelled to completely rework their strategies and move their entire operations online. But even brands with a pre-existing online presence have faced the heat. Faced with a marketplace that’s more crowded than ever before, heightened logistical challenges, and amplified customer expectations, the ability to adapt and remain flexible in the face of these challenges has been crucial.
Customers, the whole caboodle for businesses
But while some companies may fare better than others in their response to this new paradigm, the one issue that remains universal is the break in the connection between brands and their customers. For many brands, building a deep and abiding relationship with their consumers is wholly dependent on the physical interaction that takes place in their stores. Businesses go to a great deal of effort and expense to create physical spaces and displays that speak to their philosophy and showcase their values, all in an effort to attract and retain like-minded consumers.
And while this approach may have reaped dividends in a world before Covid-19, that no longer holds true in the new normal. Physical storefronts have rapidly become a relic of the past, and this situation seems unlikely to change going forward. While the vast majority of countries have lifted their initial lockdowns, health experts and organisations have warned of an oncoming second and in some instances third, the wave of infections. As a result, many countries have re-imposed their restrictions on social gatherings, events, and unnecessary outings, further straining the already tenuous bond between brand and customer.
Are consumers geared up to take off with internet?
Another challenge that has resulted from this state of affairs is the overcrowding of the internet with companies and the subsequent decrease in customer attention. The attention span of online users, and social media users, in particular, has always been minimal. This fact is borne out by a study conducted by Microsoft, which indicates that the attention span of the average person has been falling ever since the advent of the internet, and is now at an all-time low of eight seconds. The increase in internet usage since the start of the pandemic, across websites, online storefronts, and e-commerce platforms, in particular, can only have further reduced these figures. Customer churn is real, and it’s here to stay.
Faced with these challenges, what’s a brand to do to survive? For some, the answer has come down to pricing. In an attempt to shore up the waning interest of existing customers while simultaneously attracting new buyers, they choose to price their products lower than their competitors. Inevitably, this devolves into a race to the bottom, with multiple brands trying to offer the public the best rates possible. But in these sorts of battles, there are no winners. Quality corners are cut, products and services get devalued, and loyalty is foregone. The end result is the deterioration of the brand’s value – and once that happens, there’s no going back.
A better route is for brands to acknowledge the importance of their customers’ loyalty, and devote the entirety of their marketing efforts towards keeping it intact. After all, a vocal fan base is worth their weight in gold, especially when they work in unison. Through the creation of user-generated content (UGC) and consumer advocacy, fan bases have frequently amplified and enhanced the marketing efforts of a brand to otherwise non-scalable heights, all at the fraction of the cost of a traditional campaign. And their benefits don’t stop there. According to a study conducted by global marketing research firm Nielsen, 92 per cent of consumers believe suggestions from friends and family more than they do advertising. Similarly, UGC is seen as 35 per cent more memorable and 50 per cent more trustworthy than a brand’s own social media content. Clearly, an immediate bump in sales doesn’t justify the long-term impacts of lost brand loyalty.
Shell out green to digital
Instead of alienating their most ardent supporters, brands should instead focus on bringing them ever closer. Fans are the bedrock on which a sustainable business is built. To do that, the situation calls for creative thinking, ingenuity, and originality. And while that may not come naturally to every company, a few online tools are available to fill the gap. Social media tools such as Brandie empower brands to pinpoint vocal advocates who promote their products and reward them for their loyalty. The end result is an organic, cost-effective marketing campaign that effectively brings together a brand with the consumers who love it the most.
Despite the global crisis posing a severe challenge to industries across the spectrum, the obstacles that brands now face are not insurmountable. Customer churn and a loss of loyalty are both issues that can be contained and dealt with when the proper measures are employed. But it’s up to the brand to take the first step in this new world of ours.
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