By: Rob Bates
June 23, 2015
Even shoppers used to shopping online can be turned into loyal brick-and-mortar customers with the right experience, according to a new survey of high-income shoppers from the Luxury Institute.
Milton Pedraza, CEO of the Luxury Institute, says that retailers today need to focus on building relationships—both on- and offline. His survey quizzed consumers with an average income of $289,000, and $2.9 million average net worth.
Among its findings:
—Women still prefer to browse for jewelry at stores.
Forty-nine percent of female respondents prefer to shop in store before deciding what jewelry to buy, and are more likely to enter stores without a sense of what they want or looking online.
“Woman are still very open to having an experience,” says Pedraza. “Jewelry isn’t a commodity product. Jewelry and watches are more experiential than other luxury goods. Consumers may research online but they still want to experience your store. They place great value in the discovery process.
—That’s less true for men.
By contrast, only 21 percent of men relied primarily on in-store shopping to make a decision. Twenty-eight percent of watch-buying men said they entered stores knowing precisely what to buy. Still, 37 percent of men wanted assistance from sales staff for jewelry purchases; 33 percent felt the same way about watches. But 38 percent preferred to get the information online.
“Most men don’t enjoy the experience of buying in a jewelry store,” says Pedraza. “They are more tightly focused and less willing to change. Though that is mostly older men; I’d say young men are more likely to change their mind. Of course those are stereotypes but they are still valid.”
—The in-store experience is more critical than ever.
“Customers enjoy the in-store experience, but we have so many retailers that are drone-like and similar,” he says. “Retailers have to be Disney. A long time ago there were just amusement parks and then Disney reinvented them. Luxury retailers have to reinvent themselves.”
That means stocking unique products and upgrading your associates, plus trying to make your store look and seem different. He points to Warby Parker’s innovative new eyeglass shops, whose sales per square foot now rival Tiffany’s, as an example.
—A key part of your store experience: Your store associates.
One quarter of women shoppers say they want a sales associate to help them purchase. But the quality of the associate makes the difference, Pedraza says.
“The industry is hiring people as opposed to selecting people,” he says. “We need to help associates to build skills, and compensate them for the long-term. I was talking to someone and he was complaining his people leave. I said of course they leave, they don’t feel respected, they don’t feel they are valued. If you pay a little extra you can have them really engage with customers and help build the brand.”
—Customers want great service, regardless of channel.
“You can’t stop people from going online,” he says. “It’s all about building relationships, no matter what the channel is. It’s making people feel special. You can create wonderful long distance relationships with online shoppers, the same way we do in our personal lives.”
—There are no “tricks” to servicing Millennails.
“We say millennials are so different,” Pedraza says. “But increasingly they are the same, especially as they get into their 30s, and they have kids and aging parents.
“So it’s not as much about treating millenials differently,” he adds. “It’s about treating them as individuals. It’s about digging deep. I always ask millennials if they want sales associates to help them and they do. But they mostly see them as unprepared and not trustworthy.”
—Price is not the most important factor.
“There is still a tremendous opportunity not to sell on discount,” Pedraza says, “but to sell on value, craftsmanship, design, a story, and the engagement with another human being. All of those elements are not about price. There is still a tremendous opportunity for stores to really forge relationships with consumers.”