It’s that time of year again — consumers are all about the hot chocolate and the hot deals. But with financial stressors affecting the modern consumer, shoppers are growing more hesitant to click the “buy now” button. Retailers must find inventive ways to stimulate sales in a tough economy with increasingly competitive choices.
A key issue retailers must abate is the decline in consumer confidence among shoppers. According to a study from McKinsey & Company, consumer optimism took a hit in 2023, with only 33% of consumers reporting feelings of optimism about the economy. Of those surveyed, millennials reported the largest decline in optimism, with only 39% retaining positive outlooks.
However, the same study finds that despite these anxieties, younger consumers still want to splurge. This trend supersedes economic status, with Gen Z and Millennials voicing their desire to splurge across all economic categories.
Earlier this year, Gerent explored retail's consumer engagement challenges — and opportunities — in a two-part podcast series featuring thought leaders from Salesforce, as well as from our own ranks. In the first episode, Salesforce’s Vice President and General Manager of Retail, Rob Graf, examined how to take advantage of that urge to splurge.
“Now, it’s all about retention,” Graf noted. It’s about how to create stickiness with existing customers. […] What we’re seeing over the last couple of years is a lot of switching of brands partly because of availability, some of it was because of price, and now it’s about brand stickiness. But it’s also about increasing the share of wallet by creating new categories, services, and actually whole new business lines — and that comes back to better understanding the consumer.”
It is possible and profitable to tap into the Millennial and Gen Z market while increasing customer retention — in 2023 alone, it’s estimated that global retail spending will increase by 4.5%, reaching $3.1 trillion. Businesses looking to capitalize on this opportunity must utilize a solution that maximizes consumer confidence by building new categories and services that bring shoppers back again and again.
Combining AI, CRM, and data to elevate consumer confidence
In a market where maximizing productivity is necessary to remain competitive, the retail space is leveraging artificial intelligence to automate processes for increased productivity. AI’s expansive presence in the retail market is projected to grow from $7.14 billion in 2023 to $55.53 billion by 2030, according to Fortune Business Insights.
The reason for this is simple: by leveraging AI, companies can balloon productivity and increase revenue. In 2023 alone, AI is expected to contribute $194 billion in online holiday sales. By improving process flows and generating more accurate product descriptions, AI is slated to deliver top-rate customer experiences.
AI could also help personalize consumer shopping experiences, which Gerent’s Sales Director of Retail and Consumer Goods, Rosa Campagna, cited as useful in episode one of our retail series: “56% of customers expect all offers to be personalized to them, especially if they’re a brand they’re already engaged with. […] The personalization piece is also important.”
However, not all AI tools are created equal — issues of data privacy are a growing concern, as are issues with unsatisfactory AI chat assistants. According to a 2022 CX Trends report, 60% of customers disclose feelings of frequent disappointment when dealing with chatbots. With the quality of AI being an issue, isolated solutions may not be the right way forward; companies need tested, trusted, and comprehensive solutions to assuage customer concerns.
Salesforce Einstein 1 and Salesforce Commerce Cloud have the functionality required to connect buyers to satisfactory experiences. Unlike a simple chatbot, Einstein 1 couples CRM, data, and AI technology to maximize the efficiency of AI communication and customer insights. Commerce Cloud furthers that experience with a 360° view of buyers.
- Optimal Product Descriptions and Photos. Consumers trust brands with transparency, which is why customer reviews can have such weighty impacts on spending. By utilizing top-rate AI technology in an all-in-one solution, businesses can leverage data feedback to improve their photos and product descriptions to avoid negative reviews and swift returns.
- Predictive Customer Insights. By intermingling data with AI, companies get a 360° view of their client base, making it easier to suggest products — giving customers the perfect opportunity to splurge by connecting them to products they’ll love.
- Better In-Store Experiences. With the increasing popularity of BOPIS (Buy Online, Pick Up In Store) and in-store returns for online purchases, sales associates can struggle to satisfy customer inquiries due to siloed systems. Leveraging a solution that couples data, CRM, and AI into one solution connects employees to the data they need to keep customers coming back for more.
- Transparent Inventory Availability. With omnichannel inventory management, products on the move will be easy to track from warehouse to destination. In addition, front-end employees will have a more accurate screenshot of inventory remaining. These capabilities can abate consumer frustration over inaccurate inventory information.
By wielding Salesforce Einstein, companies can retain customers in greater volume — ensuring their competitive advantage over other retailers. Gerent’s B2B Commerce Practice Lead, Liam Huston, summed this potential up in our podcast, “Building a Better Order Management Process: How Salesforce Helps Retailers Innovate & Win”.
“The amazing thing that’s being delivered by the usage of Salesforce is that you’re […] able to fully capture and embody what that customer is,” Huston said, “And what their interests are, likes, dislikes, what their buying habits are, what they wish to potentially in the future be exposed to.”
Improving customer confidence with an experienced implementation partner
With the busiest retail season of the year fast approaching, finding time to implement Salesforce can be a challenge. This is where a seasoned implementation partner comes in; switching to Salesforce is seamless with the help of professionals who understand the platform — and the retail industry.
At Gerent, delivering client requests in an efficient and timely manner is what we do. With over 15 years of industry experience, we excel at finding new and innovative ways to increase ROI with each implementation.