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Is your brand equipped to deal with a major incident or negative customer experience?

The consequences of a negative incident can be significant – from loss of reputation to even a drop in stock price. It can place the very survival of your brand at risk. The retail environment is open to a myriad of possible issues and scenarios that if mismanaged, can prove difficult to recover from. These challenges range from a negative customer experience, to an IT issue affecting sales, a web outage or a product recall. The ability to respond decisively and effectively to a negative incident is the ultimate test of management, your internal protocols and your company’s corporate culture.

Research shows that companies who respond poorly to a major crisis or negative event, lose on average 15% of market value in the following months, compared to a 10% increase in share price for companies who respond effectively. Think of how that can impact your bottom line, not to mention the broader impact on your brand’s reputation and performance.

While so many organisations dedicate a lot of time, energy and money to brand promotion – and rightly so – unless coupled with brand protection, this good work can be undone in an instance No business is immune from the possibility of a sudden event or incident that can put brand reputation at risk. However, when ‘promote and protect’ are in balance you have a better chance of enjoying brand health, business growth and reputational resilience.

So here are a few tips to equip you to manage an issue or incident.

1.Audit the customer experience.

Understanding how to prepare for and manage, the consequences of a negative experience, is the first step towards ensuring your brand and business is prepared to survive it. Look at every aspect of your business that a customer will experience: your website, shop front, social media platforms, customer service, staff, the quality of your product including warranty and return policy. What can go wrong in each area? Consider the key scenarios you could encounter.

2. Build a protection plan

Developing a robust, workable and realistic issues management plan is an investment in protecting the value of your business and insurance for your brand and your hard earned reputation. This plan will be built around your core values, company ethos and key messages. The plan must address the concerning areas your audit exposed and detail the steps you will initiate to overcome these. For example, if your website crashes is there ample back-up phone lines? Are staff briefed and key stakeholders notified? Are there key messages prepared and retail outlets ready with this information on hand?

3.Test the plan

There are many ways to ensure the issues management plan is workable. It will cover all aspects of your business, so create scenarios in each area to really pressure-test the plan. Run focus groups, test the shop and web experience, trial the warranty and return policy, engage and train staff. Are there areas for improvement? What vulnerabilities were uncovered? Put steps in place to ensure best practice, then test again.

4.Social and media management

In today’s 24/7 news environment, an organisation must respond quickly and appropriately when an issue breaks. It is critical key staff are trained to be able to address media and be spokespeople for the brand. It’s too late for this training to take place when the company is fielding calls from the media or disenchanted customers. A company must provide open and consistent communication which will see your brand maintain good standing in the eyes of key stakeholders and the public. In addition, social media should not be seen as simply a reactive tool but a way to monitor and ‘listen’ before a crisis breaks. It is the best ‘early warning system’ a brand has and can be used to build ongoing trust after a negative event.

4. Promote and protect brands

A negative issue must be looked upon as an opportunity to show the human face of the brand. Having a clear brand vision and an issues management plan in place allows the organisation to feel in control and prepared to deal with that inevitable negative occurrence. It’s important that management and staff sleep well at night knowing a plan is in place to protect their business.

Responding quickly, acting with integrity, displaying empathy and updating stakeholders regularly are the key ingredients to gaining control, minimising damage and ensuring your retail brand enjoys a favourable reputation for years to come.

For a complimentary audit of your crisis communications plan please call Chris Gray on (02) 8235 7600.

Chris Gray is the Managing Director of Daylight Agency, an integrated communication firm which specialises in both promoting brands and providing issues and crisis management support to retail and consumer organisations. Learn more at daylightagency.com.au

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Australia’s CBD retail landscape is evolving in the face of continued headwinds, with brands harnessing creativity and innovation to increase their consumer wallet share.

CBRE’s Q1 Retail MarketView report highlights the ongoing need for both tenants and retail landlords to recalibrate their offerings in response to changing market conditions.

“While CBD retail remains more insulated from headwinds than shopping centres, there is an increasing need for landlords to be more creative in repositioning their assets to secure tenants,” CBRE’s Head of Logistics and Retail Research, Kate Bailey said.

The latest research shows 65,000sqm of new CBD retail supply is slated nationally in 2019 – the largest annual total since 2014. The majority of new supply will be in Sydney (52,000sqm), followed by Melbourne (9,000sqm) and Adelaide (5,100sqm).

“In Sydney, David Jones’ refurbishment of its Elizabeth Street flagship store (39,000sqm) is the main development in the pipeline. Increasing its product mix towards luxury, beauty, shoes, and food, the department stores’ refreshed offering is indicative of wider CBD trends nationally,” Ms Bailey added.

CBRE’s Victorian Director of Advisory & Transaction Services – Investor Leasing, Zelman Ainsworth said retailers were diversifying their offering by experimenting with store formats in CBD locations around the country.

“The CBD retail landscape is evolving, with more retailers looking at how they can readjust their footprint to leverage the more populous metropolitan markets. An example of this is Ikea’s new small format store – a digital format store spanning less than 100sqm. This trend isn’t an anomaly, with the majority of other traditional large format retailers now leaning on technology and logistics to reduce the typical large format stores – allowing them to bring their retail networks closer into the CBD, where the density is,” Mr Ainsworth said.

“Bunnings has also been building small format metropolitan stores over the years, while Baby Bunting, Woolworths, Coles, and David Jones are other major retailers transforming their retail networks in line with the rise of inner-city apartment living.”

CBRE’s Head of Retail Leasing for Australia, Leif Olson, said with the increasing digitalisation of retail, these retailers were opening more doors in Australia’s major CBDs.

He noted: “Not only have tenancy mixes changed significantly over the past five years, with a more concentrated focus on food & beverage and entertainment, traditional retailers are focusing more on their store size and getting more productivity out of their spaces. We are seeing car brands, hardware, and small format supermarkets, making a push into cities, which we haven’t previously seen.”

Mr Olson said there was also an increasing focus on activation of under-utilised spaces such as basements and building entry lobbies.

“Highlighting this, Kyko Group refurbished its building on the corner of King and Elizabeth streets in Sydney, allowing premium international brand Acne Studios take a prime corner with high exposure. Another example of this is 4 Bridge Street in Sydney, with the landlord capitalising on the increasing demand for boutique food & beverage in the CBD by converting the former hair salon to a restaurant, accessed via the rear lane.”

About CBRE Group, Inc.

CBRE Group, Inc. (NYSE: CBRE), has more than 90,000 employees (excluding affiliates) and serves real estate investors and occupiers through more than 480 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit, www.cbre.com.

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Leading companies joined forces with the City of Sydney to pledge a dramatic reduction in single-use plastics across their businesses.

Industry leaders from the hospitality, accommodation, events, and property sectors have come together with Lord Mayor Clover Moore, to sign up to the Sydney Single-use Pledge.

More than 30 organisations have so far taken the pledge, including the Sydney Opera House, Atlassian, Fox Studios and Star Entertainment Group.

The commitment means there will be fewer plastic bottles, straws, throwaway cups, and food utensils at a growing number of Sydney hotels, entertainment venues, markets, festivals, major events, and outdoor spaces.

The Lord Mayor said the pledge shows Sydney businesses are determined to reduce the devastating effect single-use plastics are having on the environment.

“Acting together, we can reduce our impact on the environment and show the world that Sydney businesses are leading the way to a zero waste future,” the Lord Mayor said.

“Studies show that up to 1 million plastic drinks bottles are purchased globally every minute, but less than 50 per cent are collected for recycling.

“Plastic straws can last up to 600 years and many end up in our beautiful harbour and waterways. It is shameful that by 2050 there will be more plastic in the ocean than fish.

“While recycling plays an important role in managing our waste, we need to refocus on reduction and avoidance.

“The City has set bold targets to reach zero waste by 2030. We must reduce the amount of waste we produce, recycle as much as possible, and treat what’s left over in the most sustainable way.

“I congratulate the businesses who have signed up to this pledge, and I urge others to get on board and commit to phasing out single-use plastic because it’s better for business and better for the environment.”

Businesses from the City of Sydney-led groups Sustainable Destination Partnership, Better Buildings Partnership, and CitySwitch have committed to reducing single-use items in their businesses and buildings. So far 32 organisations have signed the pledge, with more expected to join.

Under the new environmental pledge, businesses commit to implementing at least four actions that will reduce reliance on single-use plastic items.

The City of Sydney has taken a platinum pledge, committing to phasing out seven single-use items in its buildings, at its venues and events within the local government area. The City will eliminate or reduce the use of the following items:

  • bottled water
  • plastic straws
  • plastic serve ware, including expanded polystyrene
  • plastic utensils
  • promotional flyers
  • plastic single-use sampling or giveaways
  • single-use cups

The City has developed guidelines to help everyone using its venues and outdoor space find sustainable alternatives to single-use items and ensure that where waste is generated, recycling is maximised: cityofsydney.nsw.gov.au/Guidelines-for-single-use-items

The pledge form is available online: betterbuildingspartnership.com.au/sydney-businesses-are-eliminating-single-use/

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The identification of market trends is a key factor in the analysis of market research. It is aimed at identifying what is trending in the sector that may impact the business or present opportunities that are a natural fit for the business in its constant pursuit of customer loyalty.

In order to effectively analyse market data, it must first be gathered, and this requires research.

Research methods can be primary (first party research) or secondary (research conducted by others) and qualitative (feelings, emotions and intentions) or quantitative (number, volumes and figures).

For retailers this can include any of the following:

  • Ad tracking – periodic or continuous market research to monitor a brand’s performance using measures such as brand awareness, brand preference and product usage
  • Advertising research – used to predict copy testing or track the effectiveness of advertisements for any medium via its ability to gain attention, communicate the message, build the brand’s image and motivate the consumer to purchase the product or service
  • Buyer decision process research – determines what motivates people to buy and what decision-making process they use
  • Internet intelligence – searching for customer opinions on chats, forums, web pages, blogs etc where consumers share their experiences with products, becoming strong opinion formers
  • Mystery shopping – an employee or representative of a market research firm poses as a genuine shopper to record and analyse the shopping experience. Often used for quality control and researching competition
  • Store audit – measures the sales of a product or line at a statistically selected sample store to determine market share or determine whether a retail store provides adequate service

With so many potential sources of information the key is to select those most able to provide the intelligence that the business requires. Too much information makes it a challenging process to ascertain which has the most value. It is preferable to take a quality over quantity approach and pay close attention to the source and method of data collection to ensure effective data analysis.

The distillation of the most valuable market research into analysis that has the potential to guide future organisational decision-making is a core retail marketing competency. This analysis must always be conducted through the lens of what the business most needs to know in order to secure its ongoing profitability and sustainability.

It follows then that the resulting analysis would be of significant value to key business stakeholders.

The frequency of such reporting is largely an internal organisational decision as it the priority list of stakeholders who need to receive the information. What is consistent however, is the need for the information to be relevant, current and presented with clarity to highlight the opportunities and challenges the business is both facing at that moment and likely to face in the near future.

Consider what 2019 trend predictions have impacted Australian retail and to what level. It is the task of retail marketers to investigate trends and analyse them in an attempt to ascertain their likely impact upon the business and sector. This can assist is evaluating potential negative impacts in order to develop effective contingency plans. Equally trend analysis can substantiate varying business strategies from growth to customer acquisition and in the process support effective business decision making.

The ARA Retail Institute runs multiple workshops on retail, planning and strategic management. Join the ARA Retail Institute in their latest workshop which looks into how to analyse merchandise performance results and follow an organisational strategy to plan and enhance ongoing merchandise performance.  

About ARA Retail Institute

ARA Retail Institute is Australia’s leading retail training provider for both accredited and non-accredited learning programs. For more information, please visit: www.retailinstitute.org.au

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Despite e-commerce continuing to mature and grow in convenience, today’s shoppers still value bricks- and-mortar stores. Zebra’s 2019 Shopper Vision Study found that during the past year, only 43% of shoppers opted to purchase items online instead of visiting a physical store, proving that most shoppers still find value the in-store experience.

Shopper behaviours in-store

Though the preference for in-store shopping remains, Zebra’s study found that shoppers are owning their shopping experience more than in previous years. Only 62% of the study’s respondents were satisfied with the level of information or help that sales assistants could provide.

With the wide use of smartphones, shoppers are now able to search for coupons, discounts, product information, price comparisons—and basically anything they can access through the internet. Shoppers from Zebra’s study responded that they consider smartphones to be an essential tool to their shopping, with most believing they’re more connected to store information than the sales assistants. Therefore, equipping sales assistants with the right mobile technology is even more crucial to put the advantage back in the retailer’s hands. 

Empower sales assistants to maximise in-store retail sales

Retailers can use their brick and mortar stores to their advantage and potentially increase in-store sales by equipping sales assistants with the right technology. Tools such as barcode scanner-equipped mobile computers and business tablets put performance directly into sales assistants’ hands, giving them the power to help find answers to customers’ questions.

Tools like enterprise mobile computers give sales assistants the capabilities to enhance customer service—capabilities like real-time inventory visibility, processing payment anywhere within the store, product information lookup, access to customer information and alternative fulfilment options.

Retail mobile technology can be the simple solution retailers require to personalise the in-store experience for customers and positively impact business.

To learn more about what retailers can expect in the future, read the full 2019 Shopper Vision Study here.

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Zendesk's latest Quantifying the Business Impact of Customer Service in Australia Report 2019, shows companies that fail to deliver quality customer service experiences could see an adverse impact to their bottom-line.

The research reveals that businesses failing to address bad customer experiences may be losing loyal customers and the sales they provide in the short-term.

Nine out of ten customers claim that bad experiences with a company result in a change to their future buying decisions, while almost half of respondents (42%) stopped buying from a company altogether due to a bad experience.

While creating loyal and strong relationships with customers has long been a priority for businesses, it is more important now than ever with customers’ high expectations. Customers rate a bad experience as anything from waiting too long, to not even having the issue resolved at all. Conversely, a good customer service experience was described as receiving fast, effective responses or not having to explain issues multiple times.

The impact of bad customer experience goes far beyond short-term sales. Bad experiences can also have a long-term impact on customers’ perception and relationship with a business. Interestingly, customers are more than four times as likely to remember unfavourable experiences from two years ago than favourable experiences. Providing timely and effective customer service will ensure companies avoid leaving an indelible mark that is harmful to their reputation.

Amy Foo, Managing Director, Zendesk A/NZ said, “Businesses are always competing to offer the latest and greatest products or services. But what is often overlooked is how quality customer service remains to be a cornerstone of business success.”

“What can separate competing businesses is how they engage with their customers. Providing positive experiences can mean the difference between poor, short-term and positive, long-standing customer relationships. This inevitably has a significant impact on sales and revenue in the long-term, ” added Foo.

While customers do have high expectations, they are very clear about what it is that makes a customer service experience positive. Customers’ preference for a range of platforms highlights how important an omni-channel customer service approach is to making customer experience easy and efficient. A quarter of customers say that simply having multiple options for contacting customer support made for a good experience.

Foo said, “What this data suggests is that businesses can no longer afford to overlook the importance of delivering consistent excellence in customer service.”

“Addressing the challenge to provide a flawless customer experience is achievable, however businesses need to look closely at the service they are delivering to their customers. Practical ways to meet and exceed customer expectations are easier than you think. This could involve streamlining your internal processes for easier communication, offering more self-service options, or simply increasing your channels to make sure your business is across all digital and traditional communication platforms.”

Zendesk makes better experiences for agents, admins, and customers. As employees, we encourage each other to grow and innovate. As a company, we roll up our sleeves to plant roots in the communities we call home. For more information, visit www.zendesk.com/about

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Nespresso’s unique retail experience allows shoppers to explore the journey that the brand undertakes to bring their customers high-quality coffee; from farming through to production and recycling, reflecting a holistic commitment to sustainability and a circular economy.

Nespresso are committed to educating Australians on where their coffee comes from because they know that this is something their customers care about. Interestingly, a survey Nespresso conducted in 2018 uncovered that 51% of Australians don’t know this*. It’s their goal to educate consumers on our AAA Sustainable Quality™ Program to help them make informed decisions.

Innovating the retail experience

Nespresso are proud to showcase its unique coffee story and commitment to sustainability through our immersive and innovative boutiques. Their boutiques allow customers to follow the journey of their high-quality cup of coffee all the way from production to recycling.

Upon entering our boutiques, visitors are encouraged to explore a variety of different coffee tasting rituals and experiences, from a sensorial welcome, to taste comparisons and coffee masterclasses.

A responsibility to farmers

Since launching the Nespresso AAA Sustainable Quality™ Program in partnership with Rainforest Alliance in 2003, the program has grown to support over 100,000 farmers in 13 countries around the world. The company educates its farmers on the best agricultural practices to produce high-quality and sustainable coffee with a team of agronomists. This ensures farmers’ well-being is kept at the core of the business and helps them protect the quality of their coffee for generations to come.

A commitment to recyclable materials

Nespresso value innovation, which is why they have become the first company to commit to using 100% ASI-certified aluminium by 2020, in partnership with Rio Tinto. Nespresso knows aluminium is the best material to encapsulate coffee, not only because it protects the freshness, taste, and quality, but also because it is infinitely recyclable.

How can retailers recycle?

Nespresso encourage their customers to recycle their used aluminium capsules by offering four easy options:

1. Drop them off at any Nespresso boutique

2. Return them to one of over 300 participating florist collection points

3. Take part in a bulk recycling collection point (or set one up yourself for free)

4. Mail the used capsules to their recycling plant in an Australia Post satchel

*Nespresso Coffee Compendium research conducted across Australia by YouGov in 2018 on 1,019 adult participant

For more information on Nespresso’s recycling points and recycling program, visit www.nespresso.com/au/en/recycling-how

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If you need proof that online shopping has skyrocketed, just look at this new data that compares the rate of online shopping with the rate of our population growth. In the last two years, Sydney, Perth, Canberra and Adelaide have seen higher growth in online shopping than the growth of its population.

The findings come from the parcel delivery data by CouriersPlease (CP), which delivered nearly 18 million parcels Australia-wide and internationally in 2018 alone. The data reveals the number of parcel deliveries to online shoppers between April 2017 and March 2019 across five States (NSW, Victoria, Queensland South Australia and Western Australia) and six cities (Sydney, Melbourne, Brisbane, Canberra, Adelaide and Perth).

How the cities compare

The city in which online shopping has outpaced its population most is Sydney. The growth in parcel deliveries to online shoppers in the last two years is 2 times the city’s population growth (10%) growth in deliveries compared with a 4.34% population growth). Perth came in second, with its rate of parcel deliveries growing at almost 2 times the rate of its population (12% growth in parcel deliveries compared with a 6.44% in its population).

Although Brisbane’s population grew by 4.16% over the two years, its rate of shopping deliveries fell by 1% between April 2017 and March 2019. Melbourne residents attracted a 1% growth in online shopping deliveries, but its population grew higher – by 6.94%.

How the States compare

The data also compared parcel deliveries with population growth at a State-wide level. It seems a good proportion of regional West Australian residents are shopping online: WA has seen more growth in online shopping compared with its population than any other State (11 per cent growth in parcel deliveries compared with a 2.29% population growth in 2017 and 2018). NSW came in second, with a 9% growth in parcel deliveries compared with a 2.45% population growth.

Meanwhile, residents in Victoria, Queensland and South Australia seem to have had more restraint on their spending. Shopping has remained stable in Victoria (0% growth), while both Queensland and South Australia have experienced a decline of 4%.

Jessica Ip, CP’s spokesperson, said: “While retail spending in actual stores might have decreased, we’re seeing a rapid increase in the rate of online shopping in multiple States and cities. Online retailers are continuously improving the online and delivery experience for customers, making purchasing goods online a more convenient and attractive option. CP – and an increasing number of retailers – are continuing to innovate in the last-mile delivery area for consumers. For instance, CP’s flexible delivery options such as POPPoints, where shoppers can collect parcels from various news agencies and 24/7 lockers, allows customers to receive deliveries at the time most convenient to them.”

About CouriersPlease

CouriersPlease (CP) is a leading courier and freight service that delivered nearly 18 million parcels in 2018 alone. CP offers a network of POPStation (Pick/Post your Own Parcel) parcel lockers comprising more than 3500 lockers in 45 locations and more than 1000 POPShop retail outlets to enable consumers and businesses to pick up or post their parcels more securely and out of hours. Owned by Singapore Post (SingPost), a leader in eCommerce logistics in the Asia Pacific and USA, CP’s international and domestic air services connect customers to over 220 countries. Visit couriersplease.com.au.

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A business objective is something the business is aiming toward or a strategic position it is working to attain. Usually it is a step in the strategy.

Objectives are similar to goals, but often have success/failure rather than quantifiable metrics. Objectives clarify strategies into a business focus that others can understand and strive to achieve.

Terms like goals, objectives, strategies, visions, and action plans, KPI’s (Key Performance Indicators) and CSF’s (Critical Success Factors) are frequently used in everyday language.

The ARA Retail Institute runs multiple workshops on retail, planning and strategic management. Join the ARA Retail Institute in their latest workshop which looks into how to analyse merchandise performance results and follow an organisational strategy to plan and enhance ongoing merchandise performance.  

For example, a business may wish to be known for its superior customer satisfaction (vision). They then develop a strategy around training, supervision, performance management, research and recruitment to achieve this vision. One objective of the strategy would be to minimise the level of customer complaints. It is critical to the success of this objective to effectively handle any customer complaints, leading to a KPI defining the target number of customer complaints. The result of this KPI is that your team acts in a way to minimise customer complaints.

Given these definitions, retail marketing objectives can cover concepts including:

· Perceptions: reputation, store/brand image, and goodwill.

· Customers: satisfaction, loyalty, word-of-mouth, target market.

· Product/service: quality, consistency, packaging, and alignment with customer needs, after-sales service and return policy.

· Value: affordability, value for money, return on investment, discounts.

· Awareness: merchandising, store presentation, promotion plans.

· Access: store location, buying, store layout, logistics, and channel management.

· Processes: personal selling, sales incentives, service delivery, and database management.

From these objectives, retailers can develop goals along with related performance indicators to ensure the objectives are delivered upon given the business context.

Goals are ideally measurable and as such are time specific. This allows for effective evaluation of performance using KPIs or key performance indicators. KPIs are the performance measures prioritised by the business for a given role or area of business. They help teams and leaders identify where to focus their efforts in order to maximise their contribution to overarching business objectives.

Goals and KPIs focus marketing activities to those initiatives that are core to the success of the retail marketing function. Their measurability is a key feature of their benefit to business.

As is true in the delivery of all business objectives, the delivery of marketing objectives requires adequate and appropriate resourcing. Whilst in most cases resourcing is considered in terms of the financial investment required to support business initiatives, resourcing does not end there.

In addition to finances, the resourcing required to deliver upon marketing objectives can include:

· People

· Knowledge, skills and experience

· Materials and equipment

Once the appropriate kinds of resources have been identified, it is important to quantify those resources and ascertain when they are likely to be required and in what quantities. This must be part of the planning process as it may require significant forward planning to ensure the provision of resources as required. Recruitment of new staff, training and development of required knowledge and skills, procurement of necessary materials and equipment, all take time particularly if the marketing objectives are large in scope and magnitude.

We have focused exclusively on areas relating directly to marketing. However, to be effective, marketing objectives need to be supported by objectives across all areas of the business. There is no better representation of this than if you consider a business plan is not just a marketing plan - it also includes a finance plan, a people plan and an operations plan.

A marketing objective of service excellence needs to be aligned with:

· Operations - the level of supervision of front-line staff

· People - need to be trained, inducted and coached in quality service

· Finance - budgets need to reflect the number of staff required to deliver quality service

Without this level of support and alignment, objectives are limited and may potentially fail. A method commonly employed to ensure a range of integrated objectives is set for the business is known as the Balanced Scorecard.

Balanced scorecard

Businesses have historically used financial measurements to gauge their success. The problem with this narrow approach is that not all business processes or operations contribute directly to bottom line financial measures like Return on Investment (ROI) or Earnings Per Share (EPS).

About ARA Retail Institute

ARA Retail Institute is Australia’s leading retail training provider for both accredited and non-accredited learning programs. For more information, please visit: www.retailinstitute.org.au

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As competition increases locally and globally, retail brands are increasingly turning to innovative technologies like cryptocurrency and blockchain to assist in customer retention and improve sales performance.

Shopping has become a part of our everyday habits and a popular pastime that generates trillions of dollars for the global economy annually. In fact, a recent PWC survey has shown that a majority of global consumers plan to shop and spend either more or the same amount in the near future. The same survey reveals that consumers are optimistic when it comes to shopping and are willing to spend on both experiences and products.

When it comes to shopping, the mobile age has irrevocably changed our shopping habits. With one of the highest mobile penetration rates (78%) around the world. In We Are Social’s recent digital report, it was revealed that 73% of Australians have searched online for a product or service. Furthermore, our recent survey found 31% of consumers are also using a digital device to assist them while shopping in-store.

Be it shopping online or from a physical store, our purchase decisions can either come on a whim, or after we’ve conducted extensive research– what’s in the product, where it is from and product reviews. Not only that, there are also other crucial factors that play a part in the different stages of shopping before consumers make their final purchase decision. These factors include the overall shopping experience, price promotion, and the convenience of payment.

The changing shape of loyalty programs

As competition increases locally and globally, brands are finding more ways to add customers to their loyalty programs – exclusive offers, discounts and rewards – to assist in customer retention and improve sales performance. Some of the more prominent loyalty programs in Australia include Coles' flybuys, Woolworths Rewards, Qantas Frequent Flyers and Virgin Velocity, where they have a combined number of 37 million memberships.

However, the 2018 for love or money research study revealed that instead of loyalty points, which has traditionally been the case for most loyalty programs, there is an increasing number of Australian consumers, notably Millennials, who are interested in earning cryptocurrency rewards. In fact, 36% of loyalty program members wished to be rewarded with cryptocurrency instead of points, and this interest increased to 55% for Millennials.

This change in loyalty rewards comes as no surprise given that cryptocurrencies have been a topic of interest these days, starting from when Bitcoin – the world’s first cryptocurrency, set a record high value of $20,000 USD in mid-December last year. Today, there are over 1,600 different crypto tokens out there, and brands are hoping to leverage this blockchain technology to differentiate themselves from others.

For instance, Japanese e-commerce giant, Rakuten revealed its “Rakuten Coin” initiative aimed at expanding its international customer base. This cryptocurrency will be used as part of the company's points-based loyalty rewards system. Further to this, American rental-car company EZ Rent-A-Car, has also started to offer cryptocurrencies as a reward option for consumers with the introduction of CryptoRewards Exchange (CRE).

In Australia, Melbourne blockchain start-up, Shping – a global shopper-marketing and consumer engagement platform, uses Shping Coin ($SHPING), an a cryptocurrency to reward consumers for actions such as writing a review or scanning an item within the Shping app. This is a single universal rewards currency that any brand or retailer can take advantage of.

When blockchain meets retail

As cryptocurrencies continue to make its way into the retail industry in the form of loyalty rewards, companies are also exploring more ways to pivot their business to blockchain. Notably, brands and retailers are using blockchain to incentivise interactions and activities amongst consumers where actions like writing a product review, referring a friend, or rating a product will earn them crypto coins that they can use in their next purchase – further simplifying the payment process.

With blockchain, companies like Shping are also creating platforms built on the GS1 standard to allow consumers to scan barcodes that will reveal whether the items have been recalled and verify its authenticity; enabling more transparency between brands and consumers. Furthermore, incentives are also given when consumers are active on the app such as filling in a survey or watching a product video on the app.

The incentives do not just stop with consumers, but are also extended to brands where they get to communicate with their customers directly, obtain consumer and behavioural analytics, and personally market to identified consumer groups.

As retailers and brands begin to leverage blockchain technology, they create a decentralised global marketplace that benefits everyone. Even though blockchain technology is still at its infancy, it is promising to see that it is now being utilised more in the shopping and retail industry, and within a short span of time, we will be able to see how blockchain will revolutionise retail.

Gennady Volchek is the founder and CEO of Shping, a first of its kind, blockchain-based brand protection, traceability and shopper marketing platform. Shping recently added a revolutionary cryptocurrency-based reward system to allow product brands, retailers and related organisations to reward consumers who use the innovative Shping app to help them make smarter and safer shopping decisions. Learn more at shping.com.

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