30 Jul Why People Buy Shoes: Four Things Brands & Retailers Should Know
For shoe brands and retailers, motivating consumers to purchase products is both an art and a science.
The art is that ingenious million-dollar catchphrase that pops in the head of the marketing director while riding the crowded subway on a Friday evening. The science comes from the hundreds of hours spent hosting customer focus groups and pining over scores of market data.
Whatever methods companies use to strike that balance between creativity and objective analysis, an awareness of these four key components that motivate shoe purchases is critical.
People are drawn to shoe brands and retailers with familiar names, logos and slogans. Hence, building brand awareness, and eventually strong brand loyalty, is crucial for staking a claim in the shoe business.
The storybook successes over the last few years may come to mind here—brands like Nike Inc., Converse and Timberland or retailers such as Foot Locker Inc., DSW and Journeys.
Experts say masterful brands create a value exchange that goes beyond transactions and promotions.
According to the 2015 Loyalty report, by consulting firm Bond Brand Loyalty, brands are more successful when they “fulfill customer needs, make customers feel recognized and valued, and engage through relevant and personalized experiences.”
“In short, these principles help brands outperform by making the experience with the brand better, get customers to a place where they’re willing to pay a premium, and make them more loyal to the brand,” the report said.
There are two types of companies: those that create the footwear trends and those that follow the trends. And this may sound like a dig against one type of company—the trend follower—but it’s really not. There are profits to be made for both the innovators and the firms that survey the market for trends and create products that fit the mold.
All companies should focus at least some effort towards innovation of the research and development variety, but experts say the key to success is finding a niche. There are tons of opportunities to carve out a market positioning in the shoe space and companies shouldn’t feel the need to be innovative just for the sake of it.
It comes down to selecting a market in which a firm can maximize its revenue and branding potential: whether it’s offering unique luxury pumps, developing ground-breaking sneaker technology or simply offering various takes on the season’s popular styles.
Sales and Promotions
How many times have you bought something you don’t need or even want just because it was on sale? It’s hard to deny the fact that sales boost sales. It’s almost a no-brainer that people often gravitate toward marked down merchandise.
But who really benefits from mega-sales and product promotions?
Experts warn that there can be many pitfalls to excessive promotion—ranging from brand dilution to insignificant revenue boosts to an inability to sustain the sales’ momentum.
The Harvard Business Review says the robust revenue growth from a product’s promotion is often followed quickly by a return to baseline revenues—a “dust settling effect.”
“Promotions of frequently promoted brands, for example, tend to have a positive short-term effect on both retailers’ and manufacturers’ revenues but a negative impact on retailers’ profit margins,” according to a Harvard Business Review study. “Thus, the interests of manufacturers and retailers may well be aligned for one financial metric, such as revenue, but not for another, such as profit.”
So, what’s the solution?
Experts say loyalty programs that engage consumers are one option.
“The most effective loyalty programs focus on adding value for the customer not discounting,” said Tyler Walton, marketing manager at consulting firm Clutch. “While a coupon can periodically be effective in driving lapsed customers back, the overall focus should be on the brand experience.”
Walton recommends using soft rewards—instead of relying on discounts—such as free gift-wrapping or VIP parking. And also rewarding customers for non-purchase activities like sharing their positive experience with a brand or product on social media.
Ease of Purchase
No one wants to jump through hoops to spend hard-earned money.
The more convenient it is to snap up a pair of shoes, the more likely it is that consumers will make a purchase.
Brands and retailers should use market data to determine the most effective methods for selling to their customers. Often the best strategy involves using combination of marketing and distribution channels: brick-and-mortar, e-commerce and mobile.
And there should be seamless integration across channels with features such as “in-store pick-up” where possible.