Is Customer Loyalty Even Possible Online?

How does a brand create loyalty when shoppers can easily switch to other brands they see on the Internet? David Selinger, CEO of Rich Relevance, a San Francisco company that makes personalization and product recommendation tools for eCommerce sites, such as Sears, WestLaw and Patagonia, shared his insights in a recent Forbes article.
Creating and maintaining loyalty as consumers move across channels is the biggest obstacle for all marketers today. Shoppers are constantly searching for items online, comparing prices at different sites, coming back to a retailer’s site (or not) after searching on Google ( GOOG – news – people ) or Amazon for the same product. Or they might go into a store intending to buy a certain product, but then use their mobile to look up prices at competitors’ Web sites. (According to Motorola ( MOT – news – people ), 51% of shoppers overall and 64% from the 18-to-34 age group used their mobile phones for in-store shopping-related activities during the 2009 holiday season. This included comparing prices, finding user reviews and making a purchase via mobile.)
Overall, 43% of consumers switch channels during the shopping process, according to a June 2007 Forrester study entitled “The Web’s Impact On In-Store Sales: U.S. Cross-Channel Sales Forecast, 2006 To 2012.” The problem is, as people move between channels–online, offline, and mobile–they have a 45-50% chance of changing the retailer they will end up purchasing from. People want the best deal today; they are not loyal to brands or certain retailers.
The loss of loyalty isn’t simply a problem, it’s got massive opportunity cost as the multi-channel shopper should be considered our most valuable asset. Whatever the channel a customer uses to interact with a retailer, those interactions should be problem-free, but they should also be full of value-added, personal, engaging offers. And these interactions should be seamless–one customer, one experience. When a customer frequents a retailer’s site online and then goes into the physical store, the sales associates should be able to access that person’s past sales history to recommend items they’d be interested at the price points they are willing to pay–and vice versa.
One way to build loyalty is to converge on one concept of engagement across channels. Most retailers do this independently in the offline and in the online channels; but few focus on creating a consistent user experience across channels, which may explain why retailers are losing 45-50% of shoppers as they switch channels. Instead, retailers need to give consumers a reason to continue shopping at the same retailer–regardless of channel by providing a personalized experience in every channel–enticing people not only with recommendations for specific products and services that meet their needs, but with recommendations for products at price points that match their past purchase behavior. After each purchase marketers should utilize every channel to present consumers with relevant, personalized offers over time–by e-mail, Twitter, iPhone app, personalized recommendations on their site, etc. That way shoppers don’t need to switch to another retailer to get the products they want at the price they want to pay; they trust their preferred retailer to present them with the most relevant products and the best deals, so they don’t need to comparison shop.
It ain’t much, but it’s a start.

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