Rethinking Retail: Adapting to Digital Demands for Sales Growth

Data from the British Retail Consortium (BRC) suggests that December Christmas sales grew by only 1.7% since 2022. With that said, overall retail sales volumes fell by 3.2% in the same month –  the biggest drop since the 2021 COVID lockdowns.

Despite this, Adobe found that UK buyers increased their online spending by 3.7% year-on-year. The data suggests that in the face of current economic challenges, retailers increasingly need to rely on the digital side of their business.

The challenge for many brands over the coming year is how to target customers across multiple channels effectively. The answer? Brands need to go back to basics and focus on customer engagement to drive effective sales growth in 2024, particularly online.

The customer is always right

There isn’t a retailer that doesn’t claim to prioritise customer experience, but unfortunately, many fail to take meaningful action. Failing to follow a strategy that delivers customer experiences that meet and exceed expectations will simply cause buyers to spend money elsewhere.

Customers today have high expectations for services. This is especially the case since switching between retailers for similar or even the same products has never been easier across homeware, large goods, white goods, fashion, groceries, and the like. In the past, having an omnichannel presence seemed like a competitive edge for companies. But now – in part thanks to COVID – that most businesses engage customers across online and mobile touchpoints, exceptional customer service has emerged as the USP (unique selling point) that retains customers.

As such, retailers can’t afford to make empty promises and not act on consumer consensus. Seamless, satisfying service throughout the customer journey is now imperative to earn consistent custom, loyalty, and brand advocacy from consumers who have more options than ever before. Customer service excellence and innovation will soon determine which retailers survive and thrive.

Lessons learned the holiday season: What the data says

However, before you can address the problem, you first need to understand what consumers want. Sinch recently surveyed more than 2,000 people across the globe to understand their preferences for brand communication during key seasonal holidays.

The study found that consumers strongly prefer mobile-friendly ways to receive holiday promotions, with email being the most popular method. Emaila was the clear favourite, with 69% of respondents saying they wanted to get information about deals directly in their email inbox. This was surprising, given how ubiquitous social media channels are today. But, email remains the dominant choice for conveniently accessing promotions via mobile devices during those key shopping seasons – Christmas sales, Black Friday, and Cyber Monday.

Additionally, a significant number of people expressed a preference for receiving communications from brands via social media (22%) and text messaging (19%).

While there is a clear indication that digital is bolstering consumer engagement with retail brands. Getting clear on how to minimise drop-off and increase customer loyalty to drive consumer spending will rely on striking the right balance between communication channels for exceptional customer experience.

Being omnipresent

The data is as clear as day – brands need to take an omnichannel approach as customers request engagement across multiple platforms and touchpoints. An omnichannel strategy tailored to individual preferences and offering various contact points for your loyal customers can help you stand out amidst holiday promotions.

Nearly half (48%) want information on discounts, preferring to receive promotional SMS messages. Combining email and SMS to push time-limited offers can capture attention and provide real value amidst crowded inboxes.

However, effective communication is about more than just deals. Building an overall strategy focused on simplifying customers’ lives and enabling seamless service is key.

Over 80% of consumers find transactional messages like shipping and delivery notifications important during the holidays. Notably, 50% want to get these transactional updates via mobile messaging like SMS or WhatsApp.

The takeaway is that brands should utilise omnichannel tactics to provide both promotional value as well as convenient service. Tailoring outreach to match customers’ channel preferences will strengthen engagement beyond just sales peak during the year.

Meeting customers where they are

Reaching out to customers early is an effective way to engage them before a flood of promotions. By starting communication ahead of time, brands can connect with subscribers and remain at the forefront of their thinking when those big days arrive. This early outreach also allows for a unified omnichannel strategy across SMS, messaging apps, in-app notices, and email. Each channel can be leveraged to coordinate a cohesive campaign and keep customers engaged in the days leading up to the big shopping event. The key is initiating outreach early to rise above the marketing noise and capture customer attention.

The research also found an additional opportunity for brands beyond seasonal promotions. Apparently, 83% of consumers who opt-in to receive text messages from companies expect to get promotional messages at least once a month year-round. This highlights a major opening for brands to utilise RCS messaging campaigns strategically throughout the year during high inbox engagement periods. Building subscriber lists further in advance of seasonal sales events through SMS opt-in campaigns can also give brands a competitive edge. Most importantly, creating content that resonates with customers and fosters meaningful connections will be key to success with ongoing text message marketing efforts.

Adapting to consumer preferences across digital channels is crucial for driving sales growth in the modern retail landscape. While overall sales declined in 2023, online spending increased. This highlights the need for retailers to focus on their digital presence and effectively engage customers through multiple touchpoints. Exceptional customer service has emerged as a key differentiator, as consumers have high expectations and are more willing to switch brands.

An omnichannel strategy tailored to individual preferences, offering various contact points for loyal customers, can help retailers stand out amidst the noise. Effective communication goes beyond just offering deals – building an overall strategy focused on simplifying customers’ lives and enabling seamless service is key. Brands that utilise omnichannel tactics to provide both promotional value and convenient service –  tailoring outreach to match customers’ channel preferences and adapt to consumer needs across channels –  will have the power to drive meaningful engagement and sales growth in our new digital reality.

Kate Nowrouzi, VP of Deliverability and Product Strategy at Sinch