An important aspect of customer retention is communicating with and marketing to shoppers by offering personalized offers and rewards, at the shopper’s preferred touch points. This helps encourage repeat purchase.
THE CUSTOMER EXPERIENCE ERA
Customer retention is now more important than ever. Over the past four to five years, the retail industry has undergone major changes: retailers have learned that it’s six to seven times more costly to acquire a new customer than it is to retain an existing one (Bain & Co.). This same research shows that by boosting customer retention rates by as little as 5%, companies can increase their profits by up to 95%. Modern shoppers are better informed than ever, less forgiving and increasingly demanding. Limitless opportunities to shop around, research, compare, share and explore alternative products, prices and options are making shoppers fickle and forcing retailers into a corner. Retailers need to understand consumers’ shopping motivations or risk losing them to the store next door. Regardless of whether their customers are Baby Boomers, Generation X, millennials or even Generation Z, retailers must realize that all of their customers belong to Generation E (Expectations). This Generation expects to build relationships with their favourite brands, which transcend the traditional brand-consumer relationship and to be rewarded for their loyalty.
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