It starts with having plans for how you will convert existing customers and attract new ones.
Six months ago, the world was a completely different place. Unemployment in the United States was at a 50-year low. Consumer sentiment was high, people were spending a lot of money. By most accounts, the economy was strong.
And then — you know what happened. For several months, the economy slowed to a crawl as we sheltered in place and stayed home to help slow the spread of a highly contagious virus.
But something interesting has started to happen in the retail world. In May, retail sales surged 18 percent, up from what had been historically low months. And e-commerce has withstood the coronavirus; in many ways, it has thrived in spite of it. U.S. e-commerce sales were up nearly 50 percent in April, right during the middle of widespread shut downs.
While retail franchises have no doubt taken a hit during the pandemic, there are signs of real hope and cautious optimism. As consumers start to return to a sense of normalcy — at least to what we now know as the new normal — retail franchises stand to benefit if they meet customers where they are. Here are three ways to do that.
Expand your e-commerce and omnichannel offerings
What the data is telling us is that consumers are still buying goods — and spending has picked up considerably since the start of the pandemic. However, people want more options for how they buy.
In the short term, a retail solution with only the option to come inside and shop is going to face serious challenges. Millennials and Baby Boomers alike, whether for convenience or safety, are shopping more online. Or, they are shopping at an independent local retailer but opting for “curbside” pickup.
Franchises should continue to build upon their e-commerce platforms and think holistically about the shopping experience in this new era. Connecting the dots between shopping online and going into a store, retailers can find hybrid models that are both convenient and safe. The experiential part of retail is not going away, but it is surely changing. You need to meet your customer wherever they are — on their phone, tablet, computer, or in your store.
Offer flexible payment options
The ways people can pay continues to increase. Remember a handful of years ago when Apple Pay was a brand-new thing? Now, it’s something you do when you purchase a new iPhone — set up your Apple Pay.
Major chains like Starbucks make paying extremely convenient for customers. Just load up your Starbucks app or card and pay that way. But even smaller retail brands without the budget and reach of the world’s top coffee shop can offer a multitude of payment options to users. From Amazon to PayPal, there are a growing number of ways people can spend their money. In the current economic climate, it is wise to be as flexible as possible when accepting payments. One thing to consider: No contact payment options may continue to increase in popularity. Rather than handing over a credit card or entering a PIN number, consumers may rather just have their phone scanned or pay online first from their device and then claim their goods. Ideally, you never want to say “no, we don’t accept that payment method.”
Explore buy now pay later options
A fast-growing payment model is the buy now pay later (BNPL) option. It’s been popping up in e-commerce stores over the past few years as payment providers offer options for users to purchase and then pay over time. Some come with interest, others spread out the payments into equal plans. The company I‘m with, ViaBill, works with thousands of retailers to offer consumers the option to pay overtime with no interest. We’re also launching a subscription model that allows consumers more credit to pay over time. Retailers love it because they don’t take on any of the risk—they simply pay a small transaction fee for each purchase, much like a credit card.
Consumers appreciate the BNPL model as well. Rather than feeling swamped with high-interest credit debt, they have the option of paying over time (over several months) without any interest. In this era where consumers are looking to save on debt, yet not stretch their budgets, BNPL solutions offer the ability to buy what you want without paying all upfront— and without paying any more than what the goods are valued at.
BNPL models aren’t just for e-commerce transactions either. We’ve started to work with a national mobile device repair franchise that uses ViaBill inside their stores. It’s set up on iPads where consumers can simply enter their information and complete the transaction online. This is an example of blending the hybrid shopping approach with a new way to pay. Clients using BNPL often see a substantial increase in average order volume (people spend more money per transaction) and a decrease in abandoned shopping carts (less people figuratively walking away online or literally walking away in a store).
The key is to be flexible. Put yourselves in the shoes of consumers and determine all the ways they want to shop and pay. Giving them options is a great way to increase sales and volume over time.
Kristian Niedoborski Thøgersen is the President of ViaBill in North America. Since 2014, ViaBill has empowered merchants and members with its buy now, pay later payment solutions. ViaBill delivers a convenient, flexible and competitive online payment option to Members when shopping with Merchants in Denmark, Spain and the United States. Payments are split into four equal monthly installments with zero interest. ViaBill is headquartered in Copenhagen, Denmark, with 93 team members globally, consisting of 24 different nationalities.
For more information, visit viabill.com
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