TECHNOLOGY

Study: Emotional engagement could boost revenues by 5%

BY Deena M. Amato-McCoy

If retailers want to drive revenues, they need to get more “emotional.”

Tapping into consumer emotions have the strongest impact in driving loyalty, according to a new study from Capgemini. Retailers that can foster higher emotional engagement with consumers could potentially increase annual revenues by 5%, according to the report, “Loyalty Deciphered — How Emotions Drive Genuine Engagement.”

Yet, a stark disconnect remains between executives and consumers when it comes to how well organizations are making emotional connections. Eighty percent of executives feel their brand understands the needs and desires of their consumers, only 15% of consumers agree.

As emotions become a key driver of loyalty, it proves that current loyalty approaches are broken. An earlier Capgemini report found that 28% of consumers are abandoning loyalty programs without redeeming any points, and over half (54%) of loyalty memberships are inactive. One key reason is that many of today’s loyalty programs attempt to buy consumer loyalty through monetary rewards only.

Emotional engagement, specifically, honesty and trust, trumps rational factors and brand values when consumer choose where to shop. Eighty two percent of consumers with high emotional engagement would always buy the brand they are loyal to when making purchasing decisions, compared to 38% of consumers with low emotional engagement. In addition, 81% of emotionally connected consumers will not only promote the brand among their family and friends, but they will also spend more. In fact, 70% of consumers with a high emotional engagement spend up to twice as much with those brands.

Emotionally engaged consumers are loyal to the brands they love and willingly act as ambassadors to family and friends. They want brands to be engaged and reciprocate their loyalty in two-way interactions (86%), but they also enjoy giving back to a brand (81%). Consumers also want differentiated shopping experiences both online (75%) and in-store (73%).

“Consumers are immune to transaction-based loyalty programs of the past, so a retailer’s engagement with consumers needs to shift from being transactional to more emotional and meaningful,” said Kees Jacobs, Consumer Goods & Retail Lead, Insights & Data Global Practice at Capgemini.

Females and males equally represent emotionally engaged consumers, but millennials (58%, aged 18-36) and consumers in urban locations (53%) comprise the largest proportion. Italy (65%) and Brazil (57%) have the most highly emotionally engaged consumers followed by U.S. (56%) and Spain (51%).

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TECHNOLOGY

Target launches new way for shoppers to pay in-store

BY Marianne Wilson

Target Corp. has expanded the features on its mobile app.

The discounter has added a mobile payment feature to its app, allowing shoppers to pay with a single scan of their phones at checkout. According to Target, a big benefit of the new wallet feature is faster in-store checkout—up to four times faster than other payment types.

In addition, Target’s wallet combines digital savings via its Cartwheel offers and weekly ad coupons with its 5% REDcard discount. Shoppers also will be able to store and redeem Target gift cards with the wallet feature, which is available for both Android and iOS (Apple) versions of the Target app.

In August, Target officially moved its Cartwheel savings app into the main Target app in a move designed eliminate customer confusion over the retailer’s two separate apps.

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TECHNOLOGY

The top strategic initiative for retailers is…

BY Marianne Wilson

It really is—or should be—all about the customer.

Customer-centricity ranked as the top strategic initiative in a new report from BRP. According to the report, retailers must accommodate customers who “pre-shop” for merchandise online before they ever enter a store, want one-day or even same-day delivery, and expect “more” from their shopping experience – more personalization, a larger assortment, a more fulfilling experience and non-stop entertainment. Customer-led demand is driving retailers to transform their business to be more customer-centric.

“Customers use technology daily to enable and control their shopping journey,” said Gene Bornac, senior VP at BRP. “Now it is up to retailers to play catch up with their organization, processes and technology to deliver the right products for the right price in the right place.”

According to BRP’s 2017 Merchandise Planning Benchmark Survey, it is imperative that retailers take a customer-centric viewpoint.

“To innovate the customer experience, they must transform their disparate systems, processes and organization into one cohesive environment with the ability to offer customers a seamless shopping environment across any channel and the capability to deliver merchandise immediately – wherever it is needed,” the reported stated. “It is time to prepare for the future of retail – it is here – whether we are ready or not,” the report stated.

To prepare for today’s new retail model, BRP said retailers need to do the following:

•Align the organization
·58% of retailers currently have an integrated planning organization across channels;

•Integrate planning processes
·64% of retailers have integrated their business planning processes across channels;

•Implement the right technology
·33% of retailers have implemented new omni-channel demand planning systems within the last two years;

•Prioritize customer insight
·42% of retailers incorporate real-time customer feedback into their in-season planning; and

•Take action
·19% of retailers must overcome IT/business resource constraints to advance their planning activities.

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