Retail marketing is an essential aspect of the sales process. Without marketing, products cannot reach consumers; as such, marketing is the process of bringing the product to the customer or end user. This may seem like a simple concept, however, there are actually conflicting approaches to marketing in retail. For example, the classical approach is based on the marketing mix theory, otherwise known as the “4 Ps”: product, price, place, promotion. This traditional marketing strategy is broadly product-oriented, emphasising the placement or location of the product in relation to the customer. However, the landscape is shifting significantly; now, retailers need to realign their marketing strategy towards a customer-oriented approach. Below, we discuss the characteristics of customer-oriented retail marketing and how to adopt this new strategy.
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Retail marketing in the age of the consumer
Previously, the 4 P’s dictated that a company must begin with a product, set an attractive price, and present it to the customer in a strategic location. Now, technology has dramatically shifted the way that consumers interact with a brand. Instead of visiting physical retail locations, there is a tilt towards e-commerce. Equally, consumers expect brands to anticipate and meet their needs. Brands should be able to reach out to customers digitally, creating a fully personalised, customisable experience. As such, the retail marketing landscape has shifted from being product-oriented to customer-oriented. Instead of considering how to push a particular product, brands now need to think about how to place the customer at the centre of their strategy.
Thus, companies need to transition from the 4 Ps to the 4 Cs of customer-oriented retail marketing. These are:
- Consumer (vs. Product): Understanding the wants and needs of a client base and developing products in response, as opposed to focusing on the product the retailer thinks they should sell.
- Cost (vs. Price): Cost is a more nuanced approach to pricing – it takes into account all overheads and the implications of a customer choosing a competitor.
- Convenience (vs. Place): The Internet has made location a less important factor in consumer behaviour. Instead, convenience considers how easily a customer can complete a transaction.
- Communication (vs. Promotion): Communication encompasses a wide variety of marketing efforts, including PR, social media, advertising, and other types of exchange between company and consumer.
3 steps towards a consumer-oriented retail marketing strategy
The rationale for the transition from a product-oriented approach to a customer-oriented approach is clear. But how can companies work towards delivering this strategy? Below are three concrete steps towards developing a customer-centric retail marketing strategy:
- Collect customers data. The Internet is already awash with customer data, including everything from demographics, behavioral data, engagement metrics, and transactional information. Therefore, it is essential that businesses deploy tools to capture this data, like chatbots.
- Construct customer profiles. From here, companies should use this intelligence to construct detailed customer profiles. With this information, businesses can build 360-degree customer models.
- Personalize the customer journey. Today, consumers interact with brands across numerous channels. Therefore, companies need to carefully track these customer journies to deliver timely content.
Customer-oriented strategy: The future of marketing strategy
Customer-oriented approaches are the future of retail marketing. Today, success is contingent on placing the customer at the centre of a communications strategy. Therefore, businesses need to leave a product-oriented approach at the door. Instead, they need to anticipate and meet customer needs; deliver ease of service and convenient transactions; and develop engaging, timely marketing content. In order to deliver this strategy, businesses should ensure they learn as much about their client base as possible. As a result, companies should collect extensive customer data and develop detailed customer profiles. With this intelligence, they can ensure they deliver the level of service the contemporary consumer has come to expect.