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How to Use Conversational Commerce to Increase Your Retail Sales

conversational commerce

Traditional retailers understand the value that providing an open dialog with customers brings for their business growth. This 1:1 connection between buyer and seller can help increase sales by improving consumer comfort level, providing shopping guidance, and building trust that leads to repeat purchases.

Today’s consumers are increasingly turning to ecommerce shopping options to purchase the goods and services they want and need, a behavior that is especially accelerated during a pandemic quarantine that makes in-person shopping even more difficult.

In 2020, the retail industry saw a 27.6% worldwide increase in ecommerce activity, but that doesn’t mean these buyers stopped wanting the help and information they would traditionally gain from talking to a trusted sales or service expert inside a store.

Ecommerce retailers of all kinds can bring that traditional 1:1 experience to their digital ecommerce shopping experience by incorporating a conversational commerce strategy into their online retail offering.

Keep reading to find out more about what conversational commerce is, why all kinds of retailers should pay attention to it, and how retailers have seen success by incorporating this into their communication strategy.

What is Conversational Commerce?

Conversational commerce is an emerging digital framework that facilitates a 1:1 back-and-forth connection between companies and customers. Conversational commerce integrates messaging technologies like SMS and online chat to allow businesses to quickly and easily converse directly with customers in a responsive and personalized way, mimicking the way retail businesses have traditionally been able to communicate with their clientele in a brick and mortar store.

Smaller brick and mortar businesses have the advantage of knowing and maintaining personal relationships with most of their customers from the natural experience of talking and helping them in the store. After the customer walks out of the store, however, the business’s view into the customer’s life is often limited.

Conversely, larger businesses use technology to power commercial communication that occurs en masse. These communication strategies are primarily one-way directed at the customer, including materials like flyers, catalogues, and email blasts. It can feel impossible to conduct genuine, warm, 1:1 conversations at scale with their high volume of customers. It’s challenging to solve for short of hiring thousands of people to staff a phone bank.

Conversational commerce takes on that challenge and solves it  by using connective messaging technology to bridge the connection between sales and service representatives and customers to scale by personalizing meaningful 1:1 customer relationships.

Retail Businesses Use Conversational Commerce Technology to Solve Ecommerce Challenges

People have historically been more willing to purchase goods with brands they can reach, talk to, and trust, which can be challenging for ecommerce offerings to provide at scale. Conversational commerce is well-suited to support retail businesses because it melds the personalization of the brick and mortar experience with the power and scale of technology.

Each Prospective Customer Knows They Are a Unique Human

Studies show that people want to be treated as an individual, rather than as just one data point amidst a massive blob of data points -- similarly to how one may feel walking into a traditional retail environment. Ecommerce retail businesses can create a similar connection by using messaging and SMS technology to keep their brand experts accessible to shoppers as they consider and decide what to buy.

According to a 2018 Facebook study, 69% of US consumers who message businesses say that being able to message a business helps them feel more confident about the brand and 53% of consumers are more likely to transact with a business that gives expert advice via messaging apps.

Technologies that unlock conversational commerce allow brands to give consumers the personal connection they want at scale by facilitating personalization and 1:1 connection.

Ease of Shopper Abandonment

When retailers add an ecommerce channel to their sales offering, it can be challenging to adapt to the new online environment. In 2020, 84% of retail consumers abandoned their online shopping carts before checkout.

Why are the results different in an online store? In a retail environment, the shopper can easily engage with an expert. They have an opportunity to connect with the brand’s representative to get advice, and learn about the brand and products. It is complex to recreate the shopper attention and focus this 1:1 connection naturally creates in a retail environment.

Conversational commerce solves these challenges by giving retailers a way to reach and respond to all their customers quickly in a warm, personalized fashion. Retailers can mimic the in-store/in-restaurant experience digitally, at scale, no matter  the physical distance. This back and forth communication is far more successful than only relying on one-way promotions.

These 1:1 conversations can drastically improve the customer’s experience, a key objective for successful retail groups. It also builds customer trust. Through conversational commerce, retail enterprises can leverage social proof and direct customers to their peers who have had exceptional experience with their product or service.

Retail businesses looking to add 1:1 conversational commerce functionality into their customer communication strategies should consider a solution that consolidates all conversations into a single intuitive hub to assign and manage response. As the volume of conversations increases, features like personalization tokens, search and CRM integration become more and more important.

Retailers Seeing Success

At ReplyBuy, we’ve seen firsthand how much value the ability to have 1:1 conversations with customers adds for retail customers and brands.

When retailers onboard a conversational commerce platform, they empower themselves to give every customer a white-glove experience. The more customers can communicate with brands, the more they feel they have their direct attention, and the more they begin to trust and remember them. This translates directly into a more profitable bottom line.

Check out how these retailers are using conversational commerce, powered by the ReplyBuy platform, to grow their ecommerce business. Which approach speaks best to your retail business model?

  • Asda - Customer Engagement
  • Asda is one of Britain’s leading retailers, with over 18-million weekly shoppers. Conversational commerce allows Asda to send messages that are personalized and finely-tuned in terms of context and relevance. Asada can interact with their customers through a mobile-native application and opt-in on push notifications.
  • This conversational approach has seen Asda achieve a 40% conversion rate on abandoned carts and a 27% CTR on segmented notifications, including exclusive offers targeted to loyalty customers.
  • GameStop - Customer Retention
  • GameStop operates more than 7,500 retail stores selling video games, collectibles, consumer electronics and wireless services. The company wanted to keep their customers updated with the latest information and news from the gaming industry, and drive more sales through mobile customer experiences.
  • To do this, Gamestop carefully segments their customers to craft unique lists and then leverages mobile capabilities to initiate interactions and drive engagements. They deliver texts containing unique content and push notifications per customer, compelling them to engage and interact. With conversational commerce, Gamestop enjoys an impressive 90% customer retention rate.
  • Hagebau Connect - Customer Loyalty
  • Hagebau Connect is a German digital commerce company operating in the DIY market. The digitalization of nearly 400 stores prompted the Hagebau Connect management to adopt new ways to connect and communicate with their client base. To support their digital transformation, the company launched a mobile app that includes in-app chat feature where they can ask for tips from industry experts 24/7.
  • Conversational commerce has proved to be crucial to Hagebau Connect's continuing success. Targeted push notifications have generated 9x more loyalty signups and 10x greater engagement.
  • TGI Fridays - Personalized Promotions
  • One of America’s most iconic bars and grills, TGI Fridays, caters to guests at over 870 restaurants across the U.S. They also operate a popular mobile app.
  • Within the app, conversations are personalized based on the customers' information. The app anticipates their customers' needs and sends promotions and offers that consumers find relevant. The conversational approach allows TGI Fridays to give customers a truly engaging mobile experience. The restaurant has seen a 3.5% increase in average order value (AOV) and a 30% reduction in abandoned carts.

A Permanent Trend in A New Reality

Both email and SMS are capable of instant delivery. In terms of instant gratification, however, SMS delivers a far better experience than email. SMS is rapidly engaging and satisfying, making it easier for people to easily respond to the message. On average, it takes 90 seconds for someone to respond to a text, but 90 minutes to respond to an email.

Some types of messages need more detail and depth to be effectively communicated to consumers. Email is a better method for distributing these types of messages, however, most of the time companies don’t need a recurring, lengthy email for simple updates. This is when a simple, straightforward text or chat message is a better communication choice.

With SMS for business communication, companies give users the precise information they need (and nothing more) as fast as possible. In a digital ecosystem in which consumers feel information rich and time poor, consumers appreciate this mode. No wading through long emails like it’s 1999 just to get to the crux of an issue. Only lean, rapid info.

Text Messages Don’t Get Filtered as Spam

The COVID-19 pandemic accelerated the trend of retail migrating online. Nonetheless, customers still desire the attention and information they get from the distinctive brick-and-mortar experience. Retailers need to evolve to meet this growing need to keep up with the fast-paced ecommerce market.

Mobile-focused communication is essential to this modern shopper evolution.  Mobile-native apps will contribute to approximately 54% of online shopping in 2021. Retail apps need to be sharper and more delightful than ever to hold attention against the competing noise of the internet.

To stay competitive, retailers need to augment their mobile communication strategy by incorporating  conversational commerce tools into their stack to give customers the direct and personalized buying experience they expect. Conversational commerce in retail means giving all your buyers a 1:1 experience to guide them to become part of your brand’s tribe.  The results retailers can achieve resulting from transitioning from a one-way communication model to a two-way communication model are good for the customer, and ultimately good for your business.

To read more about how conversational commerce can help drive retail success, read our whitepaper.

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About the Author Brandon O'Halloran

Brandon was most recently the CEO at ReplyBuy. He is a strong sales and operations professional with a demonstrated history of exceptional performance leading customer-facing teams in B2B technology companies. Prior to ReplyBuy, he was in a senior enterprise sales role for Infogroup, a big data, analytics and marketing services provider.

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