The retail industry relies heavily on the number of visitors who walk into a store and the amount of merchandise that these people buy. The more the customers spend per visit, the more profitable will it be for the retail business in question. Keeping this in mind, retailers across the globe have been juggling between a number of innovative strategies and techniques in order to maximize sales. However, it is one thing to get more people to visit your store, but it is an entirely different thing to get them to buy from you EVERY TIME they visit your store. And this is where consumer behaviour comes into play!
To be successful retailers must understand the influence consumer behaviour has on the purchasing of customers. Understanding your consumer’s behaviour can not only help increase your overall turnover, but can also help you plan a powerful retail strategy.
The first step to planning an effective retail strategy is by understanding the retail customer. For any organization to grow and survive in today’s highly competitive market, it needs to first understand its customers and how to respond to their current and future needs. As far as the retail industry is concerned, understanding the retail customer plays a crucial role in the success of any retail firm. With globalization and technological advancement becoming the norm, a new era of consumerism has emerged where retailers are required to concentrate only on meeting the needs and priorities of the consumer.
Retailers need to know what the various factors are, that influence a customer to purchase – and this does not have to be just at the time of purchasing but can be all the factors that lead up to the time of purchase. This would include a number of internal as well as external influences, like:
In the past, many attempts have been made to study consumer behaviour including motivation research, observation, experimentation, electronic surveillance, interviews and surveys, and sales analysis or consumption research. Other factors that were taken into consideration were group influence, attitudes, motivations, and beliefs.
A great way to understand the nature of your retail market is to analyze a number of factors including population, geography of a particular area and demography. Analyzing the population will help you understand the potential markets. Population of a particular area can be based on a number of parameters like race, ethnicity and immigration and emigration rates. Immigration and emigration rates can help a retailer understand the actual population of a specific area. Race and ethnicity can help the retailer understand the buying patterns and choices of the consumers.
When a customer decides to make a purchase, there will be both psychological as well as socio-cultural influences that take place. Psychological influences include: changes in personality, beliefs, lifestyle and even attitude. Socio-cultural influences include: personal as well as family influences.
Understanding the influences to consumer decision making can turn the looker into a buyer and into a long term buyer.
Written by Penny Votzourakis for more information go to www.pennyv.com.au.