Why Are Your Best Customers Not Returning? - Lift361

Our Thinking

Why Are Your Best Customers Not Returning?

By Ed Higdon. Posted in Insight

February 27, 2020

It’s no secret that brick and mortar retail has been struggling. It has been estimated that 2019 brought about nearly 6,000 retail closures and over 40,000 worker layoffs. And yet, 86% of shoppers make purchases in retail stores. While e-commerce has certainly led to more competition for brick and mortar locations, most people are still traveling to stores. So why are shoppers – particularly high-spending shoppers not returning to stores? In a nutshell, it boils down to poor experiences.

According to Service Channel’s The State of Brick and Mortar Report, shoppers are apt to end their relationship with a retailer after just one bad experience. But just what do they consider to be a bad experience and how can you protect yourself against losing your best shoppers to a competitor?

The Real Reasons Customers Don’t Come Back

According to the Service Channel Report, the reasons why customers don’t return to stores all involve experience:

1. A Previous Poor Experience

Some 66% of shoppers told Service Channel they are more likely to shop at a competitor based on a single bad experience. After a bad experience:

  • 40% of shoppers spend less money in the store.
  • 52% of shoppers leave without making a purchase.
  • 69% of shoppers are less likely to return.
  • 46% of consumers will shop for the product(s) they were looking for online – but at another retailer.
  • 82% of consumers think retail branding and experience should be consistent across locations.
  • 70% of consumers think less of a brand without consistent experience.

2. Messy Stores

Despite the rise of e-commerce, most shopping is still conducted in stores. Nearly 70% of shoppers report having a recent negative experience with store appearance including empty shelves, disorganized shelves and even dirty bathrooms. This is especially true among female consumers who shop far more often than men and often have more say in household purchases. According to the report:

  • Bad experiences include empty shelves, broken shelves, disorganized inventory, dirty bathrooms and parking lot issues (inconvenient, crowded, poor snow removal, potholes, etc.).
  • 64% of shoppers have simply walked out of a store due to a disorganized or messy appearance.
  • 20% say they have experienced spilled products left on the floor or other messy floor issues.
  • 1 out of 5 people say they would not return to a store because of a dirty bathroom.
  • 25% of shoppers have left a store without making a purchase after encountering a dirty bathroom.

3. Lack of “Shopability”

Shoppers want to look at, touch, hold, try-on or test purchases while they are in the store, before making a buying decision. If they struggle to find what they need or if they cannot easily test out the product(s) they are looking for, they will consider it a bad experience.

  • 56% shop in-store because they don’t want to wait for delivery.
  • 44% want to be able to browse items.
  • 31% simply enjoy the experience of browsing and testing out products.
  • 2 out of 5 people said limited product availability would make them less likely to return.
  • 1 out of 4 said disorganized inventory would make them less likely to return.

4. “Shiny Object Syndrome”

Many retailers are investing in advanced technology to improve the shopping experience, but Service Channel discovered that customers are much more interested in basics than tech. Four-fifths of shoppers would rather a store be clean than have the most advanced technology. Wi-Fi and mobile app integration are expected, but before investing in anything like smart mirrors, mobile payment technology, etc., retailers would be wise to focus on the basics of a positive shopping experience. In fact, there is actually some tech that can drive shoppers away:

  • 43% of consumers are less likely to shop at a store they know uses facial recognition tech.
  • 61% of shoppers find biometrics and facial recognition tech much more concerning than the mere 24% of shoppers who find that technology to be “cool.”
  • Only 8% of consumers trust retailers with their data.
  • Only 11% feel confident that retails are properly prepared for breaches.

5. High-Income Shoppers Are Less Tolerant of Poor Experiences

While bad experiences can cost retailers consumers of all income levels, the fact remains that the higher a customer’s income, the higher their expectations are for a store and the more likely they are to take their money elsewhere after having a poor experience. Lower-income shoppers may be relegated to low-cost stores close to home despite having negative feelings about the brand, while high-income shoppers have the ability to travel farther—and spend more—for a better experience.

  • Consumers earning more than $100k have higher expectations and stronger negative reactions to poor in-store experiences.
  • 80% of high-income shoppers like stores less after they have a bad experience, vs. 75% of middle and lower-income shoppers.
  • 79% of high-income shoppers spend less time in a store if they have a negative experience vs. 76% of middle- and lower-income shoppers.
  • 70% of high-income shoppers spend less money vs. 64% for other shoppers.
  • 76% of high-income shoppers are less likely to return vs. 69% for shoppers of other income levels.
  • 76% of high-income shoppers are more likely to shop at a competitor vs. 69% for other shoppers.

A clean store, a shoppable store and a store that delivers convenience and technology without invading privacy are extremely important, but individual retailers should understand exactly what type of experiential expectations their customers have. Gaining this understanding starts with data. Understanding customer priorities and behaviors allow retail stores to make data-driven decisions that will improve the shopping experience for its customer base and protect against attrition, especially among high-income consumers.

Contact Lift361 today to learn more about the ways data can help you deliver on your customers’ expectations.