Fashion retailers must work harder to bond with customers
Supermarkets have done a great job of making their customers feel like they really know them, but fashion retailers and brands need to make more effort to bond with consumers before their marketing messages and offers are truly welcomed, according to the latest research from GI Insight.
When it comes to creating personalised, highly relevant customer communications, GI Insight’s Customer Intimacy Index – based on a survey of 1,000 UK consumers – revealed that industry sectors with frequent transactions, regular customer contact and strong loyalty programmes are those that are best received and viewed in the most friendly light by consumers.
Supermarkets topped the index, with consumers rating their understanding of customer needs and preferences as 26% above the norm. Respondents felt that these businesses demonstrated in their communications that they know their customers like ‘good friends’ rather than an ‘acquaintances’ or a ‘total strangers’. They were even more highly regarded by their female customers, who rated their grocery retailers’ knowledge of them as 33% above average.
In contrast, fashion retailers and brands were right in the middle, with a surprisingly average 103 on the index (100 = average), indicating plenty of room for improvement.
Fashion firms were found to be better at establishing personal relationships with the younger demographics, peaking in its treatment of 18-24 year olds (index score 121) and gradually waning until the 45-54 age group, which states the industry “treats them like total strangers” (scoring them 88 in the index), before picking up again with the over 55s.
Andy Wood, Managing Director, GI Insight, comments: “Supermarkets are undoubtedly the stars of the customer intimacy. This outcome is clearly related to the vast amount of information they hold on their customers, which they use to assess spending habits and react to sudden changes in purchasing habits such as the decision to purchase only from their budget range or a preference for ‘dinner for two’ initiatives.
“In contrast very few fashion retailers have true database marketing and/or loyalty programmes that encompass the whole business, yet they do have a range of opportunities for building a rapport and gathering data from their customers. With a constant array of new lines and products coming out and the scope for comprehensive loyalty schemes, there is little excuse for many of the firms in this sector to come across as relative strangers to their customers.
“However, the just above average score is being bought down by those companies that do not have loyalty programmes, indicating that fashion retailers that do operate a loyalty programme have proved that they have been successful in providing relevant and personalised communications and shows they are in tune with their customers needs and preferences.
“As the UK emerges from recession, it is critical for retailers to understand the value of customer data and its vital importance in enabling them to tailor offers and communications that are seen as relevant and welcomed by customers, thus helping with retention, cross-selling and up-selling.”
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