This post was written by Loop Insights CEO Rob Anson and was originally…
ROX is the New ROI
The consumer world is evolving at a faster than ever pace,…
The consumer world is evolving at a faster than ever pace, and consumers are leading the change. With so many options, customers expect experiences, not just products. This means that in order to make money, business strategies and metrics need to shift according to what experience customers want.
This need to be adaptable is especially true coming out of Covid-19. In order for storefronts to reopen successfully, business owners need to consider how they can pivot their operations to offer a streamlined, contactless experience for their customers and guests.
For years, businesses have focused on ROI (return on investment). ROI is a performance measure used to evaluate the efficiency of an investment. Relative to what was spent, how much money was made? The goal is to have a high ROI: maximum return for minimal investment.
Now, businesses need to analyze what constitutes an appealing customer experience to customers. Hence, Return on Experience (henceforth ROX) is the new emerging metric to measure success.
Because if customers are satisfied they will come back, which equals more money for businesses. A customer’s shopping experience is now a pivotal part to their purchase behavior.
Measuring ROX requires a company-wide view of your operations. Every single point a customer interacts with your company has to be tracked and analyzed. It leverages the interdependencies within your business, and highlights the connections between specific metrics that contribute to the bigger picture. This broad analysis yields powerful insights into which areas of the business one should focus on, and which internal actions can most elevate experience and value from a customer’s point of view.
Mapping out shopping journeys isolates the touch points or factors that drive experience, and ultimately where to invest.
Here we will break down some general expectations for brick and mortar retail— to get you started on developing your own ROX strategy.
Customers want the basics first
- Fast customer service: Often times people go to brick and mortar retailer stores because they have a product in mind and they want it immediately. Short lines and quick payment solutions are key to having them choose your store over your competitor’s.
- Easy store navigation: Building off of the first point, merchandizing that is organized, convenient, and purposeful provides a seamless experience for those quick shopping trips. Make it easy for customers to spend money!
- Contactless technology: Contactless experiences are becoming more and more important since Covid-19. Customers expect the option to pay, and interact with your store and its services, without physical contact.
- Awesome employees: Many stores offer the same product. What differentiates them is their staff; knowledgeable and personable employees add value to the customer experience. A healthy company culture will attract top talent, and ultimately yield a positive reputation.
Loop can enhance these aspects of customer experience
- A holistic view of your company: Loop tracks, aggregates and actions data drawn from across your business, creating a complete picture of your assets and each customer touch point—a necessary step for measuring ROX.
- Fast customer service: Loop’s Tap to Engage solution eliminates the use of multiple cards (payment/loyalty), speeding up retailer/customer interaction and overall line waits.
- Easy store navigation: Loop provides real-time merchandizing insights that can guide store layouts based on local preferences. Keep shelves stocked with in-demand products, and place them at the front of the store to keep things convenient!
- Contactless technology: Loop has infused its AI-capabilities with contactless technology to deliver non-contact options for your store. This includes its Tap to Engage device, digital wallet pass, and digital receipting platform. Click the link here for more on these products: https://www.loopinsights.ai/product/
- Awesome employees: Loop’s AI platform eases tedious back-end work to allow staff to focus on more interesting tasks — such as engaging customers, and building their skills and knowledge. Having insights on customer preferences also allows them to build deeper relationships and provide customized service to returning shoppers.
Nailing the fundamentals is important for sales and retention. Data suggests that one bad experience can really hurt your bottom line.
After one bad experience:
- 40% of shoppers spend less money in a store
- 52% of shoppers will leave without making a purchase
- 69% of shoppers are less likely to return
And consistency matters:
- 82% of consumers think brand should be consistent across locations
- 70% of consumers think less of a brand without a consistent experience
(ServiceChannel.com Inc’s “The State of Brick and Mortar Retail Report”)
Don’t be discouraged! Alternatively, consistent positive experiences will lead to unparalleled, authentic endorsements.
Once you’ve mastered the basics
Find more ways to attract loyalty. Using its automated platform, Loop brings forth new opportunities to wow customers:
- Satisfaction (through inventory): Because immediacy is important for brick and mortar shoppers, inventory is crucial for a positive experience. Loop identifies market trends and local preferences – so retailers can ensure that shelves are stocked with the right products.
- Consistency (through data): Data-driven strategizing and operations reduces error. People can better depend on walking into a store and expecting consistency across the brand and properties.
- Upselling (through merchandizing): Loop can also guide merchandizing to increase basket size and value. Impulse shopping occurs much more often in brick and mortar shopping experiences. Leverage this tendency through the right product placement. Click here to read more on our data-driven merchandizing tips.
- Value (through personalization): Online giants (such as Google) bring value to consumers through instantaneous, personalized ads and promotions, using widely accessible digital profiles. Historically, bringing the same value to brick and mortar customers has been difficult, due to limited in-store data.
In short: retailers need to dig into consumer behavioral and attitudinal attributes. Loop can identify how, when, where, and why customers shop, and then aggregate this data. But we don’t leave retailers stranded with the information — we make it actionable. We help develop personalized engagement, and deliver it through the customers’ preferred medium. We close the loop by connecting shopper ID with the location and transaction – helping businesses determine true attribution.Bringing innovative experiences to your store is especially appealing to millennial customers, who hold less brand attachment than say, baby boomers. Personalized promotions, on-premise to online connectivity, AI technologies, and Instagram-worthy photo opportunities are all new experiences you may want to invest in. Explore what would give you the greatest return!
Steve Jobs once advised, “you’ve got to start with the customer experience and work back towards the technology – not the other way around.”
If you’re a business owner, we encourage you to determine the points in your customers’ journey that you should invest in. From there, we can help you implement Loop’s AI platform in the best way possible, to maximize your ROX. Book a demo today.