Will consumers in 2017 continue to move their spending from products to experiences? Retail Week reports a Visa survey that shows spending at hotels, restaurants, bars and pubs rose by 6.9% in 2016, with recreation and culture spending up by 6.5%.
This growth exceeded that across product groups of food and drink, household goods, clothing and footwear.
So how will this trend affect retailers this year, and those in the ‘experience economy’ – pubs, clubs, museums, music and other recreational venues? The latter sector is set to soar as shoppers shift away from buying products to ‘doing things’, says Retail Week. This trend is fuelled by millennials who shun possessions:
More than half of UK millennials said they would rather spend their money on an experience rather than a possession, according to the UK Millennials Report, published by marketing agency Inkling.
Some 62% of shoppers plan to increase their expenditure on experiences over the next year.
So what do you have to do to ensure you do not miss out on this trend?
1. Understand your customers’ experience: evaluation through a well-designed mystery shopping plan that explores all aspects of what it is like to do business with your organisation – to find out in particular whether your frontline is performing to the standard that you expect them to.
2. Evaluate the competitor experience: use mystery shopping to identify what is happening elsewhere in your sector; what you can learn and further improve upon – what do you currently do better than the opposition, what you should actively promote?
3. Review new opportunities to increase sales: this will often mean finding ways to ensure that customers stay longer on site. How can you complement your brand offer with additional attractions or product lines?
4. Find new experiences to bring extra recreation and leisure to the customer experience. There is an increasing trend for example to bring in leisure concessions including nail bars and hair salons, as well as crèches, restaurants and coffee bars.
5. Training +: staff service and interaction with customers is key to quality of experience and almost always an area where there is room for improvement. Find out where you need to focus in recruitment, training and staff management – what are the core skills and personality types required to ensure the best possible customer visit?
Retail Surveys and Mystery Shopping for major retailers and membership organisations by React prove consistently that that the key is to take action to understand your customers, thoroughly and regularly.
Only then can you give them what they want and know what else might induce them to stay longer or visit more often – and spend more.
Send me a message for the 2017 UK Reports: What Customers Really Want, What Members Really Want – www.reactsurveys.com