Today, the overwhelming number of smartphones users in India presents retailers with a unique opportunity to connect and engage with their customers outside of physical stores. However, success will be hard to come by without a strong and effective user retention strategy. Here are five ways retailers can ensure that.
Have you been shopping online? I definitely have. In 2015, India has been growing more and more accustomed to whipping out their phones every time the groceries need re-stocking or the living room needs a new carpet. Even during the holidays, we rely on our trusty smartphone to plan a holiday, book our travel and even research interesting cuisines to try out.
So it’s no wonder that the e-commerce industry has grown in leaps and bounds. Retail e-commerce sales in India have grown over three-fold, from $2.3 billion in 2012 to $7.7 billion last year. Not to mention, it’s slated to touch $17.52 billion by the end of 2018. (Statista)
As we step foot into this year, we take a look at the trends that will define 2016 and shape the adventurous journey of mobile commerce in India. The overwhelming number of smartphones present retailers with a unique opportunity to connect and engage with their users outside of physical stores. The trick lies in retaining those customers.
It’s about more than just products
Even as retailers continue to put in efforts to increase their user base, success will be hard to come by without a strong and effective user retention strategy. As Varun Jha, an industry expert told us, “A user retention strategy goes above and beyond offering discounts and offers. It has to be about connecting with your user in line with your mission and values. Loyalty programs, a strong product and a sound content strategy are just a few ways to engage your users. Differentiating yourself is key to becoming your users go-to-shopping destination.”
Customers must not just drop by your platform when they want to buy something. Companies might sell millions of units a day, but buying something is a rare event for the customer. The retail platforms should aim at keeping the customers engaged even between these rare buying periods.
Retail stores must not just focus on pushing out products after products. This will drive the customer to you only when the customer wants to buy something. What will truly keep the customer hooked is content. For example, I’d keep visiting a retailer’s website if they posted in-depth professional reviews for the latest exciting tech gadgets that hit the market.
Not just Cash or Card
The past year has seen an explosion of mobile payment wallets – Apple Pay, Android Pay, Paytm, Citrus, Freecharge, PayU, Mobikwik, Oxigen and many others. The competition has intensified with banks launching their own wallets recently. Axis, ICICI, PNC and even SBI.
Each wallet has its own niche feature to offer. Some focus on partnerships with brands to offer rewards andcreate a retail marketplace. Other wallets build acceptance across a wide range of merchants. The ability to share wallets and transfer money is one of the innovations that are currently on offer.
The ubiquity of online shopping is helping drive down barriers to mobile wallet adoption. The mobile wallet revolution is still in its initial stages and far from deciding on a winner. However, due to the intense competition and the edge banks bring into this playing field, a consolidation amongst the current players is but natural. While some wallets might fail, others will buy each other out to increase their market share.
Contactless payment is another major game-changer among payment systems. In India, the RBI guidelines for a two-step payment verification has been a major limiting factor for this technology. Even after a recent relaxation of the law for smaller amounts, retailers are still hesitant to adopt such payment techniques. This is due to the hardware costs associated with this technology.
Ice the App-only strategy – for a while
India is still in the initial stages of m-commerce adoption. Only 9 per cent of India’s internet users shop on a mobile phone. (Statista) In a country where a substantial population resides in Tier-II and Tier-III cities, the success of a retail app lies in its ability to reach its users across various demographics and locations.
Limited storage space on mobile devices discourages users from downloading too many retail apps. Fear of the app hanging or fluctuating internet speeds which might interrupt a purchase make it hard for a retailer to survive solely via an app. Alienating users and forcing their hand to download an app doesn’t sit well with consumers. In a few years, it might be the right time to go app-only for a retailer, but the immediate future is most certainly not it.
The omni-presence of brands through omni-channel
Retailers looking to win big in the Indian m-commerce space should ensure they offer a seamless experience across all channels. This helps retailers partially subsidize the high rent of physical stores by grabbing as many eyeballs as possible across multiple channels. While 2015 saw an initial foray of traditional brick-and-mortar retailers into the online world, 2016 will see it truly unfold.
Starting a brick-and-mortar retail store offers an online business a variety of advantages. A major advantage would be that the retail brand can connect with a lot more people. While it is estimated that over 40 million people are estimated to buy digitally this year, it is still remains a small fraction of the nation’s populous. (Statista) Customers can experience the brand on a more touch-and-feel level, something online stores have been deprived of. Also, when customers walk into an offline store, the brand has an opportunity to understand their behaviour and requirements in a more wholesome manner.
Customers today easily adopt new channels and seamlessly move across multiple channels to search for products, share and recommend and gather feedback, compare price and promotions and eventually complete the purchase.
However, not all segments of retail need to provide a seamless omni-channel experience. Every channel plays a distinct role in the consumer’s path to purchase journey. While desktop and online form a good place for researching a product, mobile is useful for comparison, recommendations and purchases.
Retail brands and their advertising strategies have been focussed on sales, be it through discount-heavy sales or bundled goods. This could be due to the large number of products available and the little time the brands have to communicate to the customers. Such strategies have bombarded the customers with product ads they barely respond to. As a customer, my time and attention span is extremely limited. With all these product ads pouring in, I’ve lost the joy of discovering a new product on my own.
Curating products for a customer based upon his behaviour and activities is a strategy retail brands should look to employ. Based on a deep-level understanding of a customer, brands can analyse their contextual needs and wants and recommend them products through a virtual shopping assistant. For example, the assistant could understand that a customer is training for a marathon and suggest him to buy a Fitbit to enhance his training and help him prepare better. Recommending products as and when a customer would need it will disrupt the traditional form of retailing.
About the author:Vasuta Agarwal is the Vice President of Business Development, Asia Pacific & Global Partner Management at InMobi.