Over the decade, retailers have seen a drastic change in the customer’s approach towards them, thanks to the advent of technology and change in lifestyle. With a scheduled busy life, whether it’s millennials or the middle-aged, everyone has taken to the internet for their retail requirements.
The age-old approach of heading to one or many brick-and-mortar stores, checking out products, and finally making the best buy has been replaced by a quick online search and comparison of prices sitting right at home, or maybe even on the commute. Friends and family decide and share their purchases through social media. The product is then reviewed on many etailer sites and is delivered to the convenient location, sometimes on the very same day of the purchase.
Industry experts, after studying the changing shopping patterns, have even made overwhelming predictions that conclude the end of retail. While you might sit back and think that there is a negligible probability of this happening, it is important to take some precautionary measures like retail pricing strategies to reduce the adverse effects of the changing times.
Here are five retailing strategies that could help retain modern customers and in the long run increase your profit margin.
1. Know The Customer’s Shopping Behavior Thoroughly
Whether you are considering the extension of your market to the internet or coming up with strategies to retain customers, the key factor that determines these aspects is the customer’s requirements and expectations. A simple survey can give you the information you will need in drawing a conclusion on the customer shopping patterns. This input can help you come up with strategies to cater to the various needs of your customers.
2. Expand Your Profit Margins
Extending your retail services through multi-channel platforms is a great idea to enhance your profit margin. This means providing services for purchases through not just the conventional ways —catalogs, brick-and-mortar stores, and mail but also through social media, apps, and websites.
A smarter profit tool would be by following a reinvented business model. This approach has been adapted by reputed retailers like Amazon, GE, Sears, IBM, and Walmart. Amazon, for instance, has only 35% of its retailing space assigned for its transactions. The remnant retailing space is handled by third-party service providers. These retailers earn a “rent” on the digital assets that they provide to the third-party retailers.
3. Retail Pricing Strategies
Simple and traditional pricing strategies, when used effectively, come in handy when dealing with modern customers. Conventional strategies like discounts, odd pricing, high-low techniques, or even dynamic pricing—where the retailer changes the price according to what the consumer is willing to pay—can be used. You could also adapt the MSRP or the Manufacturer’s Suggested Retail Pricing to maintain the brand quality while retaining your profit rate. Other strategies that can be adapted include price lining, bundle, and below competition.
4. Reconfigure Your Assets
With trading moving to a digital platform, the physical space for your retail outlet need not be as vast as it was required to be. While certain elements of the market remain unaffected by this factor, like groceries, outlets like apparel and electronics require nearly half the space than before. It’s essential to keep future retail trends in mind as well, before switching to a more convenient retail store. By doing so, you can reduce the real estate costs dramatically.
5. Devise Plans For Smart Promotions
Don’t stop your promotional strategies with just discounts and freebies. Most shoppers look for added services and other perks while making a purchase. For instance, you could provide target-specific sales or loyalty programs. Extending your advertising to social media comes in handy here. As a retailer, you’ll need to keep in mind that the customer looks for an easy-to-access retailing experience on the go, anywhere and anytime.
The dynamic retailing market is subject to an intense competition with strategies that change by the day. It’s best to implement strategies that suit your finances, products, and resources.