How fashion retailers can stay relevant post Covid-19

As fashion stores in the UK remain in lockdown, retailers are busy behind the scenes looking at ways to mitigate the impact of the pandemic on their businesses and, for those lucky enough to be able to reopen once it has passed, ways to adapt to a post-Covid-19 world.

A new report from UK payments provider Klarna based on a survey of 2,000 UK shoppers highlights how emotional brand connection, word of mouth and in-store experiences are key for retailers to stay relevant.

In-store experiences remain key

When stores begin to reopen, in-store experiences will continue to play a huge role in the world of retail, especially when it comes to customer acquisition, according to Klarna. Thirty-five percent of consumers say they are more likely to shop somewhere with an enjoyable in-store experience, while 30 percent said it would likely increase their spending. One-fifth of the Gen-Z generation said their first interaction with a brand was through a pop-up shop or physical experience, with the demographic the most likely to value in-store services such as Wi-Fi, food and drink and charging stations.

Consumers want smart and funny ads

Creating an emotional connection with consumers is critical for both retaining customers and acquiring new ones, according to Klarna. A third of consumers (33 percent) said intelligent or humourous advertising encourages them to visit a brand or retailer’s website or store. That strategy is particularly important for the younger generation, with 39 percent of 16-34-year olds saying it was the most likely factor to influence their visit. In contrast, consumers are being increasingly put off by traditional marketing solutions, with 49 percent saying they get irritated when brands get personalisation wrong, and 59 percent feeling dissatisfaction when they see targeted ads for items they’ve already looked at or purchased.

‘Customers want to be acquired’

Companies should not become complacent with their customers or they will likely go elsewhere, according to Klarna. Two in five (40 percent) say that they are loyal to a number of ‘loved brands’ they shop with to a certain extent, but almost all (97 percent) would shop elsewhere if they saw something they liked. When finding new brands, price remains shoppers' key priority (58 percent), while flexible payment options are also becoming increasingly important (18 percent).

Don’t ignore word of mouth

As companies increasingly focus on digital marketing spends, Klarna found that word of mouth shouldn't be underestimated. Three in five (60 percent) said that when they love a brand or retailer, they’ll actively try and convert their friends, with the factors most likely leading them to recommend a brand including an enjoyable in-store experience (16 percent), a good user experience across all devices and channels (15 percent) and a good returns process (14 percent).

Laurel Wolfe, vice president of marketing at Klarna commented in the report: “In today’s world, marketers across the globe are being challenged to think differently about how they approach customer acquisition and retention - especially in light of the current situation. Our report highlights the importance of selecting well-connected partners.

“By being strategic with their partnerships, retailers will see cost efficiencies, increased sales and the flexibility to redirect budget to areas where it could be better spent.”

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