To Inspire Customer Loyalty, Retailers Uncover a New Moment of Truth

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To Inspire Customer Loyalty, Retailers Uncover a New Moment of Truth

By Amit Sharma - 08/29/2016
Customer experience is now the critical differentiator brands can’t afford to ignore. Maximizing satisfaction with a customer’s entire journey has the potential to increase customer satisfaction by 20% and lift revenue by up to 15%.The retailers that pull ahead of the pack will be those who deliver a premium experience from beginning to end.
 
Today’s consumers are quick to switch brands when their shopping experience is less than perfect -- in fact, 89 percent of customers have switched brands due to a bad customer experience. Retailers need to double down on ensuring a positive shopping experience at every step along the way, from the moment customers begin engaging with the brand to the moment their package is delivered to their doorstep.
 
The Original Moment of Truth
 
Retailers’ perceptions of the customer experience have certainly evolved. In 2005, former Procter & Gamble CEO A.G. Lafley introduced the concept of the “moment of truth,” highlighting two key moments of engagement: when a customer decides whether or not to buy a product, and when she uses that product for the first time.
 
Retailers designed their marketing strategies to address these two segments of the customer journey. Today, however, retailers must transcend these moments to encompass an entire spectrum of customer experience. The rise of the internet and proliferation of mobile phones introduced a new, mobile moment of truth. This spans the moment when a customer enters a digital store, searches a product, and ultimately decides whether or not to make a purchase. In tandem, the rise of online search engines introduced the “zero moment of truth,” when a consumer researches a product online through third-party review sites and forums outside of a brand’s control.
 
Brands are spending significant time and money to address these various moments of truth and acquire new customers. Yet, there’s a gaping hole in this strategy: once retailers win a customer, they rarely dedicate the same resources to engaging her. They fail to realize that the first impression in the post-purchase experience is often the lasting impression.  As a consequence, retailers miss the opportunity to turn single transactions into repeat customers, and eventually, brand advocates.
 
Going Beyond Acquisition
 
Today’s consumers expect the experience after they click ‘buy’ to be personalized, consistent and relevant. Not only do they expect shipping to be fast and free, they also want to know when their purchase has been shipped, exactly where it is at a given moment and precisely when it will arrive. The time gap between when a customer buys a product online and when she experiences it after delivery has become an important factor in determining whether or not a customer returns.
 
Unfortunately, most retailers follow the pre-purchase romance with a post-purchase maze of customer service phone trees, shipping headaches, and ugly subscription emails. By focusing only on acquiring customers, and ignoring the chance to retain them, retailers are missing out on a chance to increase profits by more than 25 percent.
 
Retailers Leading the Pack
 
Birchbox, the beauty box subscription service, pioneered the “monthly box” model in 2010.  Today, the company has over a million subscribers. To create an experience customers want to talk about and share with their friends, Birchbox combines its monthly deliveries of samples with personalized emails and original "how-to" videos. Consumers can explore an ecommerce shop filled with popular products and special deals, or visit their brick and mortar locations in New York and Washington, D.C. for an in-store shopping experience. With this mix of touch points, Birchbox creates a memorable, personalized experience for a customer through every step of the journey — from the moment she enters the website to the moment she opens her monthly box.
 
Warby Parker, a modern eyewear company, offers a similar personalized experience for consumers. With the company’s “try at home” feature, customers can choose 5 frames to try on at home for free, and return all frames to the company at no cost. The company will even ship a fresh pair of frames once you select the ones you want. By offering this memorable, convenient experience, Warby Parker has quickly built an impressive customer base. The company sold well over one million pairs of glasses, and was valued at $1.2 Billion as of April 2015.

Retailers who succeed in the new moment of truth will be those who deliver a premium, delightful experience from beginning to end. In order to do this, brands must apply the same focus that they have for pre-purchase customer engagement tactics to post-purchase engagement. When the post-purchase experience is a true extension of the brand, retailers foster customer loyalty for life.

-Amit Sharma, CEO, Narvar