Navigating_the_effects_of_macro-economics_in_retail_with_verified_customer_reviews.png

To say that the retail industry has been going through turbulent times in the last few years is an understatement.A lot has already been written on how the Covid-19 pandemic introduced additional challenges for brick-and-mortar and online retailers - while they already faced a raft of macro-economic pressures.A recent <a href="https://www.barclayscorporate.com/insights/industry-expertise/the-new-retail-reality/?cid=socialpaid2linVideo_Viewsthe_new_retail_reality_02RW_Video" target="_blank">report from Barclays </a>on new retail trends, however, suggests retailers are feeling more confident about growth over the next 12 months. In this article, We bring together some revealing industry statistics together with research carried out by Feefo. We then explore how businesses can take advantage of new opportunities and gain a competitive advantage by harnessing the power of advocacy.<h2>The impact of the pandemic</h2>As the pandemic hit, consumers became more cautious about spending. High-ticket purchases dropped as a result, with people focused on essential items - including new ones such as facemasks.Brick-and-mortar retailers were already struggling with a wave of closures before Covid-19 struck. But the pandemic accelerated that decline, with the bulk of closures being on the high street. In 2021 alone, the BBC reported that more than 17,000 UK chain stores closed - including big names such as Debenhams, Laura Ashley, and the Arcadia Group.As consumers turned to online shopping, companies that already had online sales operations or could set them up quickly fared better than physical outlet retailers. According to <a href="https://www.business-live.co.uk/special-features/online-shopping-surged-during-pandemic-21202301" target="_blank">BusinessLive</a>, the top 100 UK retailers reported that on average their online traffic increased by 52% during the pandemic. This included shopping for everyday essentials like groceries.<h2>Covid-19 added more pressure to the existing issues retailers faced</h2>Even before the pandemic, there was a raft of macro-economic hurdles that retailers had to deal with. These included:<ul><li>Inflation - one of the biggest drivers that can impact the retail market and one that hits both consumers and businesses</li><li>Interest rates - as we’re seeing in the UK at the moment, a government strategy to control inflation is to increase interest rates. As of August 2023, the Bank of England has raised interest rates 14 times in a row, and it says they may stay high for some time to come. This obviously increases the cost of credit and can reduce consumer spending, especially on bigger purchases such as home electronics, etc</li><li>Exchange rates - if your business operates internationally, it will be affected, positively or negatively, more than other businesses. A weak currency leads to higher import costs that can lead to increased prices on the shelves, with the opposite being true when a currency is performing well</li><li>Economic growth - a country’s economic state, as measured by things like GDP and unemployment levels, plays a significant part in how the retail market fairs. During periods of economic growth, consumer spending is usually higher as people tend to have a greater disposable income. If an economy is shrinking, they tighten their purse strings, and consequently, retail spending goes down</li><li>Government policies - taxation, trade tariffs, and regulations affecting products and services can have a direct impact on retail profitability. Increased taxation leaves people with less to spend. Tariffs can force prices up or even reduce the availability of imported goods</li><li>Demographic trends - these can affect the types of products and services people use. For example, spending on youth fashion will be less in an ageing population. So retailers need to have strategies in place to meet changing consumer needs</li></ul>

<h2>What we’re seeing in the real world</h2>Virtually all of the factors above, with the exception of demographic trends, have a direct impact on consumer confidence and spending - the lifeblood of retailers.However, perhaps somewhat surprisingly, the recent report from Barclays Bank shows that 85% of retailers are more confident about growth over the next 12 months compared to last year. This is despite the impact of Covid-19 and the pressures on global markets caused by the war in Ukraine.But companies will have to compete harder for each customer’s ‘share of wallet’. The report also points out that 84% of non-grocery and 86% of grocery shoppers have changed their spending habits and are looking around for deals because of rising prices.Whether it’s because they have less to spend or they’re becoming more environmentally conscious, people are repairing things more than before, rather than replacing them. A Deloitte report showed over 50% of people did this in 2022. The same report showed that 40% of consumers are turning to second-hand or refurbished goods.<h2>The power of invite-only verified customer reviews to influence shoppers</h2>The good news for retailers is savvy shoppers aren’t buying products and services based on price alone. <a href="https://www.barclayscorporate.com/insights/industry-expertise/the-new-retail-reality/?cid=socialpaid2linVideo_Viewsthe_new_retail_reality_02RW_Video" target="_blank">Research from Retail Economics</a> has shown that in the last year, 34% of consumers have increased the time they spend researching products before they buy them.True value for money, as well as the overall customer experience, still play a parts in people's decision-making. This is where retailers can use a verified customer reviews strategy to help them maintain sales and profitability.A survey we carried out with YouGov in July 2023 showed that a massive 96% of UK consumers read reviews before making a purchase. It also showed that 70% of consumers trust reviews more if they’re from verified buyers - that is, people who have actually purchased the product or experienced the service before leaving a review.As part of this research, we also asked people why they left reviews:<ul><li>30% were telling businesses what they liked or disliked about their products or services. This type of feedback can provide insights that help companies sharpen their competitive edges.</li><li>50% left feedback to help other people like them spend wisely.</li></ul>The way you reply to customer reviews, positive or negative, can also have a big impact on how people feel about your business. In research we carried out, 44% of people who left negative feedback would use a company again if it gave them a satisfactory reply. And 40% posted positive social media comments about a business that handled complaints well. It’s not just the reviewers that are influenced by your replies either. People reading the reviews and replies will see that you take what your customers say seriously and that you do something about it.The Barclays retail trends research shows that retailers are taking all of this to heart and are ‘especially optimistic’ when it comes to capturing consumer feedback and confidence. 60% of them now say they’ll use what they learn to guide their business practices - for example, to develop hyper-personalised marketing strategies.

<h2>Turning verified reviewers into loyal customers and brand advocates</h2>More than ever, customers are desperately looking for honest, helpful guidance when it comes to making choices about where to shop and what to buy.So, investing in creating brand advocates is something any smart marketer or business owner should have high on their list of priorities.Why? Because consumer advocates can help:<ul><li>Increase brand trust</li><li>Reduce marketing spend</li><li>Provide invaluable social proof</li><li>Increase sales</li><li>Protect your brand</li><li>Generate invaluable insights</li></ul><h3>But how do you go about creating advocates?</h3>Engaging with customers by asking them to leave a review is a great way to start, as it automatically extends the relationship beyond the point of purchase. It opens up a conversation.To create true advocacy, brands need to do more than just listen, though. They must prove they care about their customers’ needs and pain points. They have to act on feedback and show consumers that their voices are heard and their opinions count. By demonstrating that you value what you’re being told and are committed to providing the best possible products and services, you can build a base of loyal customers who will become your greatest brand advocates. At Feefo, we call this The Value Exchange.Creating advocates is, therefore, a long-term strategy. There will be some customers that engage immediately with a product or service. But, the strongest connections will form over time through repeated interactions, all of which serve to strengthen the bond between the customer and the brand.<h2>What this all means for retailers today</h2>The issues caused by the Covid-19 pandemic are declining, on the whole, and the majority of retailers are feeling optimistic about the future - despite the other macro-economic challenges they face. However optimism alone doesn’t guarantee business success. And old assumptions are no longer valid. Smart retailers need to steal a march on their competitors by talking to their customers, listening to what they have to say, and acting on the insights they learn. By meeting the needs and addressing the issues consumers are facing today, brands can create the lifelong advocates they need to guarantee a profitable future.If you want to learn more about creating advocates for your business, download our <a href="https://www.feefo.com/business/resources/customer-retention/the-power-of-advocacy" target="_self">Power of Advocacy report</a>.<h2>Talk to us</h2>If you’d like to discover how Feefo can work for your business,<a href="https://www.feefo.com/business/enquiry/get-in-touch" target="_self"> get in touch</a>. One of our team will be happy to talk you through the benefits of working with the world’s largest verified customer ratings and reviews platform.

If you want a demo of how Feefo could work for you, or discuss our solutions and opportunities further, get in touch and one of our friendly team will be happy to answer any queries.

Want to find out more about Feefo? 

Fill out your details below and one of our friendly experts will be in touch to show you around Feefo.

Reviews are just the beginning. At Feefo, we build lasting relationships with brands around the world who choose us to help translate customer feedback into actionable insight. 

Start collecting trusted reviews with Feefo 

At Feefo, we help you choose with confidence because behind every right decision is a reliable review. 

Increase sales and boost conversion rates

Reach new audiences and improve your brand reputation

Drive traffic to your site and grow new consumer confidence 

Why Feefo

Get in touch

Navigating the effects of macro-economics in retail with verified customer reviews

Female-Owner-Of-Fashion-Store-Using-Digital-Tablet-To-Check-Stock-In-Clothing-Store.jpg

Did you know 43% of consumers believe brands have got worse at dealing with negative reviews?With brand loyalty falling and customer sentiment decreasing, we asked 2,000 customers what they really want from brands. In our latest study, we help you unlock the power of customer feedback so you can turn detractors into advocates.<h3>What's inside?</h3>Download our Navigating the Negative report today, with expert analysis and business insight from leading brands, including:<ul><li><a href="https://www.feefo.com/en-GB/reviews/kia-motors-uk?displayFeedbackType=BOTH&timeFrame=YEAR" target="_self">Kia</a></li><li><a href="https://www.feefo.com/en/business/resources/case-studies/iceland-case-study" target="_self">Iceland</a></li><li><a href="https://www.feefo.com/en-GB/reviews/nisbets-uk" target="_self">Nisbets</a></li><li><a href="https://www.feefo.com/en/business/resources/case-studies/invopak" target="_self">Invopak</a></li><li><a href="https://www.feefo.com/en/business/resources/case-studies/michael-page-case-study" target="_self">Michael Page</a></li></ul>Featuring a foreword from Feefo CEO Tony Wheble and leading psychologist,&nbsp;<a href="https://www.wendydignan.co.uk/" target="_self">Wendy Dignan</a>.

Navigating the Negative Report

skyline-city-image.jpg

Navigating the Negative

Online spending has reached record highs across the UK as consumers head to their laptops and smartphones to buy everything from groceries to garden tools. The way people shop is changing and retailers need to see the bigger picture if they want to keep pace.&nbsp;<a href="https://www.feefo.com/en/business/solutions/customer-surveys">Surveys</a> are the perfect partner to your customer reviews and a fantastic way of being able to find out more about your customers. Whether it’s finding out if your website is up to scratch or wanting a better understanding of your customer experience, what you ask and how you ask it is so important for getting the insight you need.We’ve collected some helpful questions that you can include in your next customer survey to glean some useful insights into how you can improve your business. We’ve also included some survey templates to help you get started.&nbsp;Here are 20 questions to add to your next customer survey:&nbsp;<h2>Customer effort score questions:&nbsp;</h2><ul><li>How easy was it to find the product you were after on our website?</li></ul><ul><li>How easy was it to pay for your order?</li></ul><ul><li>How easy was it to get the help you needed from our online support team?</li></ul><ul><li>Why did you pick this rating?</li></ul><ul><li>How would you rate your overall experience with us from 0-10?</li></ul><ul><li>Did you run into any issues whilst using our website?</li></ul><ul><li>What’s stopping you from continuing with your purchase?</li></ul><h2>Customer retention questions:&nbsp;</h2><ul><li>&nbsp;How likely are you to shop again with us? And why?</li></ul><ul><li>&nbsp;What can we do to make your next shopping experience with us better?</li></ul><ul><li>&nbsp;Is there anything you’d like to see us do differently?</li></ul><ul><li>&nbsp;Which of these would most likely make you want to shop more with us in the future?</li></ul>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; A. Loyalty scheme&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; B. Discount codes&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; C. Free delivery&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; D. Mobile app&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; E. Other&nbsp;<h2>Customer loyalty questions:&nbsp;</h2><ul><li>How likely are you to recommend (your business’s name) to a friend or colleague?</li></ul><ul><li>Why would you/why would you not recommend us?</li></ul><ul><li>What did we do well?</li></ul><ul><li>What can we do differently next time?</li></ul><h2>Customer behaviour questions:&nbsp;</h2><ul><li>Are you more likely to shop online or on the high street?</li></ul><ul><li>What types of products do you prefer to buy online vs in person?</li></ul><ul><li>What would make you choose one brand over another?</li></ul><ul><li>Which products do you predict you’ll spend more on in the future?</li></ul><ul><li>How important is it to you that the brands you shop care about sustainability?</li></ul>

<h2>Why you should be using surveys to improve your business&nbsp;&nbsp; </h2><h3>1. To help you learn why your online journey is (or isn’t) working&nbsp;&nbsp;</h3>One of the biggest challenges online retailers face — other than standing out in search results — is keeping customers onsite and securing a purchase. The slightest obstacle can be the difference between making a sale and losing out to a competitor, so your online experience needs to be as smooth as possible, from start to finish.&nbsp;Back in 2010, the Harvard Business Review published a now-famous article called ‘<a href="https://hbr.org/2010/07/stop-trying-to-delight-your-customers" target="_blank">Stop Trying to Delight Your Customers</a>’. In it, they established the Customer Effort Score (CES) – a way of measuring how easy it was for a customer to interact with a business. Essentially, it’s an indicator of how loyal a customer is to a business.&nbsp;Running quick and simple customer effort surveys about your website can help you understand how easy (or not) it is for customers to find what they need and complete the payment process.&nbsp;&nbsp;Customers will rate their experience from “very difficult” to “very easy”, but this is more often than not presented as a simple scale from 1-5. It’s always worth asking a follow-up, open-ended question to give the customer a chance to explain why they’ve rated you the way they have.&nbsp;The quicker you ask after the experience, the more accurate the responses.&nbsp;Including a customer effort score question straight after a customer places an order, or finishes up a conversation with your live chat team can give you immediate insight into your online experience. That feedback can then be used to help improve your site for next time.&nbsp;&nbsp;<h3>2. To win back previous customers&nbsp;</h3>Returning customers spend <a href="https://www.business.com/articles/returning-customers-spend-67-more-than-new-customers-keep-your-customers-coming-back-with-a-recurring-revenue-sales-model/" target="_blank">67%</a> more on average than new customers, so it’s important to convince people to come back time and again.&nbsp;Contacting them with reactivation surveys eight weeks, six months, or even a year after their last purchase can help you discover why they’ve not shopped with you again. They can also provide insights to help you to re-engage with them and win back their business.&nbsp;&nbsp;Perhaps your competitors are offering something you’re not. Did your delivery provider miss the promised date last time? Was something wrong with your product?&nbsp;&nbsp;It could be something as simple as the promise of free delivery, or offering 10% off their next order, that turns their heads.<h3>3. To identify at-risk customers and reward loyal ones&nbsp;</h3>While we’re on the subject of retaining customers, <a href="https://www.feefo.com/uk/business/product/insights/measure-nps" target="_self">Net Promoter Score® (NPS)</a> is an effective way of quickly identifying those at risk of going elsewhere. And it’s those people you can depend on to spread the word about how awesome your business really is.&nbsp;All you need to ask is one simple question to get going:&nbsp;How likely are you to recommend ua to a friend or colleague?&nbsp;Depending on how customers rate your business, they fall into one of three categories:<ul><li>Promoters: Score the company with either a 9 or a 10. These are your loyal, enthusiastic customers.&nbsp;</li><li>Passives: Respond with a 7 or an 8. They’re happy with the service, but not enough to be promoters.</li><li>Detractors: Give a score between 0 and 6. These are classed as your unhappy customers, who are unlikely to use your company again.&nbsp;</li></ul>

Now, once you know which category they fall into, you can send them on the right path with a simple customer satisfaction survey to dig a little deeper into why.&nbsp;For the detractors, ask why they wouldn’t recommend you. What was it about their experience that they didn’t enjoy? How can you offer to make amends or improve for next time so that they’d be more likely to recommend you in the future?Promoters, on the other hand, will tell you what you’re getting right, and you can use that insight to keep them coming back and attract new customers. The answers you get will shine a light on what people truly love about your business.Ensure you plug all this insight straight back into how you operate. Improve on the things your detractors highlighted, but, most importantly, start promoting the things people really liked.&nbsp;<h3>4. To prepare for the future of retail&nbsp;</h3>Surveys are a great way to gain insight into a wide consumer audience. A well-written survey can help you to predict trends in consumer behaviour and attitudes so that you can better prepare for what lies ahead.&nbsp;Multiple-choice questions can help you identify which products could increase in popularity or reasons why consumer spending habits might be about to change.&nbsp;&nbsp;More open-ended questions can give you detailed insight into what matters most to your customers.&nbsp;<h2>Six survey templates that will get you results&nbsp;</h2>We’ve created six survey templates targeting various different points of the customer journey to help you source the information you need. You can use these as a starting point and amend them to suit your business and objectives.&nbsp;<h3>1. Market research survey&nbsp;</h3>Whether you’re planning to launch a new product or refine an existing one, you need to base your decisions on data. Market research surveys are a great way to understand if your new venture resonates with your audience.&nbsp;&nbsp;Our example centres around how customers would feel about more eco-friendly initiatives within the business. We started off with some basic demographic questions and then used a mix of multiple choice, scale, and text questions to understand people’s attitudes towards sustainability.&nbsp;<h2 style="text-align: center;"><a href="https://fee.fo/1xDoIV" style="text-align: center;" target="_self">Try the survey here</a></h2><h3>2. Website feedback survey&nbsp;</h3>Usually delivered in the form of a pop-up, website feedback surveys are an excellent way to understand if your website is meeting visitor expectations.&nbsp;&nbsp;In this example, we’ve used a combination of question types to discover how people use the website, what their experience was like during their visit, and pinpoint anything that needs improvement.&nbsp;<h2 style="text-align: center;"><a href="https://fee.fo/2BnLzc" style="text-align: center;" target="_self">Try the survey here.</a></h2>&nbsp;<h3>3. In-store visit survey&nbsp;</h3>In-store surveys allow you to understand the customer’s experience within your physical location: everything from how helpful the staff were, to why people visit your stores or branches in the first place. With more people shopping online than ever before, physical locations are under increasing pressure to earn their keep by offering an experience your customers can’t get online.&nbsp;&nbsp;In our example, we’ve used a combination of multiple-choice, customer satisfaction score (CSAT), and Net Promoter Score (NPS) questions to measure and understand how shoppers feel about their visit. This gives you key information about how to improve your in-store experience and attract more high street shoppers.&nbsp;<h2 style="text-align: center;"><a href="https://fee.fo/p6niHR" style="text-align: center;" target="_self">Try the survey here</a></h2><h3>4. Product feedback survey&nbsp;</h3>While public-facing product reviews are fantastic for boosting sales and helping you understand what people like and dislike about your products, private feedback surveys allow you to dig deeper.&nbsp;&nbsp;Product feedback surveys are very effective if you’re trialling new products, which is the direction we’ve taken in the example below.&nbsp;&nbsp;We’ve used a combination of well-recognised metrics, including customer effort score (CES), Net Promoter Score (NPS), and customer satisfaction score (CSAT), so you can easily benchmark your products against one another if you decide to run multiple product surveys. The inclusion of a short text question at the end gives you the option to collect email addresses too, helping to maintain your customer relationships.<h2 style="text-align: center;"><a href="https://fee.fo/4kinHT" style="text-align: center;" target="_self">Try the survey here</a></h2><h3>5. Customer service survey&nbsp;</h3>Ensuring your customer service team is knowledgeable, friendly, and efficient is incredibly important to your overall customer experience and reputation. That’s why surveying people after they’ve interacted with your staff is a great way to understand if you’re providing excellent customer service, or if you need to improve.&nbsp;&nbsp;In our example, we’ve started with a CSAT question to measure the customer’s level of satisfaction, followed by multiple choice answers to understand if their issue has been resolved and whether they’ve needed to contact us before. By using the logic function on the dropdown question, you can ask questions about each specific member of staff, allowing you to get more detailed feedback.&nbsp;<h2 style="text-align: center;"><a href="https://fee.fo/t8VDqg" style="text-align: center;" target="_self">Try the survey here</a></h2><h3>6. Employee engagement survey&nbsp;</h3>The anonymity of surveys makes them the ideal tool to listen to your team and get their honest opinions.&nbsp;&nbsp;In the example below, we’ve used scale questions to measure how strongly your staff members feel about the statements presented to them. If the answer is particularly negative, you may want to add logic to ask further questions and understand why they gave that answer.<h2 style="text-align: center;"><a href="https://fee.fo/hL0NJL" style="text-align: center;" target="_self">Try the survey here</a></h2><h2> Start asking the right questions with customer surveys&nbsp;</h2>If you’re interested in finding out more about how <a href="https://www.feefo.com/uk/business/product/collect-feedback/send-adhoc-surveys" target="_blank">customer surveys</a> can help improve the retail experience and prepare your business for the future, <a href="https://www.feefo.com/uk/business/enquiry/get-in-touch" target="_blank">get in touch with our team today</a>.&nbsp;

Navigating the effects of macro-economics in retail with verified customer reviews

You may also enjoy reading...

Want to find out more about Feefo?