The past few years have been a rollercoaster for furniture retailers. Demand surged during the pandemic as people looked for ways to improve their immediate surroundings. Then supply chain breakdowns, rising raw material costs and inflation tapped the brakes on consumer spending. Shopping habits have changed, but people are looking for in-store experiences even as e-commerce remains strong.
If you’re a furniture retailer who is looking to boost wallet share for your store by increasing customer loyalty, keep in mind that although price may be top of the list for customers right now, loyalty has never been all about price. Price wars between retailers are a race to the bottom. In the end, nobody wins, including customers, who may get a lower price but at the cost of a less personal and enjoyable customer experience.
Consider newly resurgent bookseller Barnes & Noble, which was almost driven out of business by online competitors that offered lower prices. After yearslong decline, the company is expanding again with a hyper-local focus aimed at increasing customer loyalty. Here’s a look at five best practices you can use to boost customer loyalty and gain greater customer wallet share for your furniture brand.
- Create amazing in-store experiences: Most furniture stores have room displays that showcase their products in an inspiring way, but you can take this to the next level by finding opportunities to bring customers into the store so they can see your outstanding staging work. VIP events for your best customers can be a great draw, and you can plan them around anything from wine tastings and pedicures to painting tutorials and design workshops in order to capture your customer’s attention. The more creative you can get with special events, the more people you are likely to bring through your doors.
- Dig into the data to find out who your best customers are and lose the cherry pickers: To create value through customer loyalty, you need to find out who your best customers are. A deep dive into your data can help you identify them and focus your rewards and outreach on those customers. It’s critical to consider purchases and interactions across channels so you get a complete picture. Make sure you’re not focusing on cherry pickers, i.e., bargain hunters who only engage to get a discount, since they shop on price alone and won’t help advance your brand.
- Give gifts to your best customers: Everyone loves a great gift, and a present that emphasizes your brand values can be an excellent way to generate loyalty. For example, one high-end women’s apparel brand gives their loyalty program customers a T-shirt for their birthday, which embodies the brand by being a cut above an ordinary tee. An affordable gift that makes a statement like this can underscore your brand promise while encouraging customers to return to your online and physical storefronts. Personalized discount offers can also tell customers you know who they are, creating trust and loyalty.
- Fully enable conversations across channels: Collecting opt-ins and opt-outs from customers to authorize conversations across channels is table stakes these days. Multiple text vendors keeping a single repository off the current state of opt-in or opt-out by customer is critical and if you’re not already doing that, there’s no time like the present. Also, review touchpoints on every channel (cookies on your website, in-store and emailed customer loyalty offers, etc.) to make sure you’re leveraging every opportunity to ask permission for a conversation beyond the immediate point of interaction and that opting out is also easy and seamless for customers.
- Use Web3 tools to mint something unique for customers: Web3 properties like non-fungible tokens (NFTs) aren’t just about celebrities overpaying for digital ape cartoons, though that tends to get the most press. The underlying blockchain concept is sound as it allows people to own digital assets and use them for a variety of purposes in real life, including as event passes. Ticket sellers are leveraging Web3 for this purpose, and you can, too. For example, you could mint unique NFTs for customers who use your online room planning tool, giving them a digital token they can use to get a discount, select a color or fabric option, or enjoy an in-store VIP experience. Digital wallets matter, too, and using Web3 to connect online activities with in-store options is a new, relatively untapped way to build loyalty.
One lesson many furniture retailers have learned over the past few years is that people’s shopping habits change, either gradually as consumers move to emerging channels or immediately in response to external events, but the change isn’t always linear. More people shopped online in 2020 out of necessity, and many are now drawn to in-store experiences because they missed the human connection. Making the shopping experience as seamless as possible across all channels is a more strategic course of action than entering a price war with competitors.
Customer loyalty is the key to generating the maximum amount of lifetime value out of customer relationships, and while price matters, it’s not a lever for elevating customer loyalty in the long term. Instead, use your creativity and online and in-store experiences to generate something less fleeting: trust and value. When you do that, you can take customer wallet share to the next level.
Tara Kelly is the founder, president and chief executive officer of Splice Software, a customer engagement company that specializes in using big data, small data and artificial intelligence to create messages that drive customer engagement and the desired call to action.