In the retail world, especially luxury retail, we hear more and more about clienteling off late. Clienteling seems to be the latest great strategy to achieve success in an ever changing world. Reflecting on what clienteling is, we can realize that it has been around for centuries. After all, human beings haven’t changed much, at least our inner desires haven’t. Yes, we have deeper knowledge about a lot of things, and we’ve become better at building, healing, advancing technology, but love is still love, fear is still fear, and, even after ages, we all still like to feel and be treated as special.
Imagine that you are a shopkeeper in a small town in the early 1900s. One of your regular customers, Mrs. Johnson, always buys a particular brand of flour from you. Whenever she comes into the store, you make sure to have that brand of flour prominently displayed and easily accessible for her. This is a simple example of personalization, as you are tailoring the shopping experience for Mrs. Johnson based on her known preferences.
The selling technique that provided special and personalized treatment for the single customer, making them feel special and cared for, was winning in the ancient ages and it’s still winning today. The only difference is that today, we’ve given a name to it: it is called clienteling.
Based on research reports and comments from senior leaders at large retailers, customer satisfaction and selling strategies based on the customers’ experience are becoming more important. Which is why there’s greater discussion around clienteling and clienteling software in the retail industry. In this article, we are just about to dig deeper on this topic, understanding why it is becoming a trend (in a good way!) in the luxury retail world.
What is clienteling?
Clienteling today is what it has always been: the practice of focusing on your individual client’s satisfaction, making their shopping experience exclusive, personal and unique.
However, clienteling today isn’t just a definition or a general practice: the theme is so deeply discussed that it is becoming a sort of discipline. Clienteling today is based on a number of principles that, according to the characteristics and demands of the market, are aimed at providing your customers with the best shopping experience possible.
We also used ChatGPT to answer this question: “what are the origins of the word clienteling?” Here is what we got back:
“The word “clienteling” is derived from the word “client,” which refers to a person who receives professional services from another person or organization. In the context of business, “clienteling” refers to the practice of building and maintaining relationships with customers in order to increase loyalty and repeat business.
The word “client” itself comes from the Latin word “cliens,” which means “dependent.” In ancient Rome, a “cliens” was a person who was dependent on a patron, or a wealthy and influential person who provided protection and support in exchange for loyalty and service. This relationship was similar to the modern concept of a client, as a client relies on a professional or organization for services and support.”
How is shopping changing in 2023?
Clienteling isn’t a trend growing at random; the causes of its growth are to be found in the changes that retailers, big and small, are facing these days. What are these changes? And how are they affecting the shopping experience?
The two major changes the retail world has faced recently are: i) the advent of technology and (ii) the lasting impacts of the pandemic. Both factors seem to have worked in the same direction: e-commerce websites are now available for anyone to create and they are more efficient than ever. The first consequence is simple: people can buy online and they do it more often. The second consequence is that retail stores are becoming more important than before. Wonder why? Well, while online and e-commerce is a good strategy for retailers, omnichannel is where consumers have moved to. Retail stores aren’t doomed, but they must change with the times (read: demands and wishes of their consumers).
Until some years ago, the shopping journey of a customer was easier to track: a person would enter a store, browse through the products, pick the one they prefer, maybe try it out or test it, and buy it on the spot. Today, customers can see a product in a store, go home and search for that product online, read reviews, watch videos, buy the product in a second store (physical or e-commerce), and have it delivered to their house. Imagine the complexities in tracking that journey!
So while clienteling has been around for centuries, with the current changes in the market, it is becoming more complex than ever to practice it successfully.
Why is the shopping experience so important in 2023?
Before we answer the question posed above, here is a suggested article our experts recently wrote that may be useful to you: How the Luxury Retail Shopping Experience is Changing in 2023
The competition from the online world is strong for luxury retailers. E-commerce websites like Farfetch or Net-a-porter, after all, offer many advantages to customers: larger catalogs and options available, the possibility of shopping without leaving the house, low prices, and free at-home deliveries that too across borders.
If a luxury retail store wants to compete with all this, it needs to offer something unique. Lowering the prices, offering at-home deliveries, and widening the catalogs and inventory aren’t effective strategies. They’re table stakes. If a luxury retail store or chain wants to beat the competition from e-commerce stores, they need to focus on the only things online stores can’t offer: a tangible experience, in-person communication and relationship, and the possibility of touching and trying the products.
Today it’s not absurd to think that the shopping experience is often considered to be more important than the product catalog itself. When people enter your luxury retail store, they want to feel unique, cared for and known by your store associates and stylists. When these customers compare two stores, they rarely compare products (products are available anywhere today!). They are always comparing the store teams, their knowledge and experience, their kindness, and the treatment they received. In other words, they always compare and rank based on the shopping experience – it’s clear what they are focused on.
Clienteling today is key to making your luxury retail business successful and allowing your business to compete with online as well as other offline businesses. Not focussing on clienteling could be an existential risk for a luxury retail today.
Customer retention is better than new customer acquisition
Clienteling is important in 2023 also because it enhances customer retention. Customer retention is a rate that indicates how many of your existing clients return to buy from your business.
When you start a retail business, it’s easy to focus and keep focusing on how to attract new clients. And yet, this is only a part of the job. The other part, more important than the first, is how to retain your clients, especially your most loyal clients. What can you continuously and sustainably do to make them come back to your store or website a second time, a third time and then regularly.
Customer retention is highly important: it boosts your sales and it’s less expensive than attracting new customers: according to a report by OutboundEngine called ‘Customer Retention Marketing vs. Customer Acquisition Marketing’, retaining an existing client costs five times less than acquiring a new one.
Furthermore, returning clients aren’t only cheaper, but they are also easier to sell to. The success rate of selling with a returning client is 65% while with a new client it goes down to 5%. Client retention lowers the cost and enhances profits: a winning formula that can boost your income and the success of your luxury retail store. Especially in uncertain times like we may be seeing.
The principles of clienteling
We’ve mentioned above that clienteling is evolving and today it has become a sort of discipline, based on a set of principles. These principles are the ones you should apply to make your luxury retail business successful; this is why they are, of course, worth knowing.
So, how can you make your customers’ shopping experience personal, exclusive and unique?
The most effective way of enhancing the omnichannel shopping experience for your customers is by personalizing it for them. What does that mean in terms of actionables?
Instead of providing the same standard service, promotions, and discounts to anybody who enters your luxury retail store, you can start personalizing the services according to each client’s characteristics, needs and tier within your loyalty program (if you run one).
Of course, to personalize the shopping experience for your customers, you need to know them. When you are able to know who your clients are, what products they’ve already bought in your store, and the preferences they have expressed on your website (think wishlists and abandoned carts), it suddenly becomes possible for you to personalize your service and their experience.
And yet this is only one side of personalization: to get to know your client’s preferences and characteristics, you need a previous step, one where you gather these types of data.
This process passes through the use of technology and, in particular, of clienteling software. As we’re discussing in the following paragraphs, the use of technology is one of the backbones of today’s clienteling. It is technology, and software, in particular, that makes today’s clienteling strategies possible.
To sum up, personalization of the shopping experience is key in clienteling today. To achieve personalization you need to rely on a system that, on one hand, allows you to gather data efficiently, and, on the other hand, allows you to retrieve data just when you need it.
As we’ve discussed above, shopping today is no longer confined to a single channel. It happens in multiple channels: some of them are physical, and some are virtual. In other words, the shopping experience is becoming omnichannel. Customers no longer want to experience a gap between the virtual and the physical world. As a luxury retailer, you need to provide an omnichannel platform (consisting of a physical store supported by an online store or vice-versa) where clients can move freely between channels. And while moving between these channels, the customer wants to be personally known and served equally well. Think of it this way, the customer would love it if they had their in-store associate to guide them in their virtual journey with the retailer as well.
Again, technology is key. But you need to be careful: you don’t need to replace human activity with automation; you need to use technology to complete and enhance human activities, communication, and relationships.
As we’ve seen, clienteling today is based on technology. Technology makes the application of clienteling principles possible.
Clienteling technology is software and, in particular, software tools that allow you to create and perform your clienteling strategies. So, what can you use clienteling software for?
- Collect clients’ data. As we’ve seen, the first step in the process of shopping experience personalization is data collection. You need an efficient system that automates a lot of the aspects of data collection.
- Process the data. Use artificial intelligence to augment the existing data and pull out important information, trends and build forecasts.
- Retrieve data. The final step of clienteling tools is that of data retrieval. Clienteling apps that can be downloaded on a smartphone and used by a store owner or associate, display the data in an easy to use and familiar interface.
- Omnichannel 1:1 customer communication: with clienteling software tools you can provide 1:1 customer communication and service through a lot of different channels including WhatsApp, WhatsApp Business, email or live chat.
- Omnichannel payment methods: most clienteling tools provide you with the ability to collect payments from anywhere. With these features, clients can check out with their mobile inside or outside your luxury retail store.
Best clienteling software in 2023
With the growing importance of clienteling, newer and more advanced clienteling tools are being launched regularly. With a plethora of options at your disposal, we’ve picked the best ones for you. You can review each software and set up product demos to pick the one that best suits the needs of your retail business. Here is our list of the best clienteling tools:
- Endear HQ
- Red Ant
Most of these clienteling softwares will provide all the features you need to perform clienteling strategies and apply clienteling principles that we’ve described: from data collection and retrieving, to omnichannel customer service and checkout. With time, however, clienteling apps have become not only more advanced but also more specific and user-friendly. If we need to compare the options available, StyleSend stands out for two reasons: (i) the StyleSend app for store associates is extremely user-friendly and (ii) it is built specifically for luxury retail.
Clienteling is being discussed more than ever in the retail business, especially when it comes to luxury retail. And yet, clienteling has always been in existence: the smartest sellers in history have understood the importance of making clients feel special and how this practice can help build a loved and profitable business.
Today, however, not only have we given a name – clienteling – to an aspect long known, but we are also discussing it so deeply that it is becoming a discipline with its own principles. The principles of clienteling, today, are personalization, omnichannel, and technology. Meaning that personalization of the shopping experience, consistent omnichannel service, and good software can help you boost your luxury retail store’s sales.
Today’s clienteling strategies are only possible through the use of clienteling software. This is why there are many new clienteling apps, even though the best ones are limited. We’ve suggested a few of the best ones. With the comparison, we’ve also had the occasion to highlight how important it is to count on a user-friendly tool, one that can provide immediate and easy support when needed. From this point of view, StyleSend is the absolute winner in the competition among the best clienteling apps for luxury retail.
If you’re unsure about your clienteling strategy, you can schedule a demo with our clienteling experts or if you want to read more check out our article on Why Investing in a Clienteling App is Worth it for Your Retail Business
If you’ve done your research and are ready to implement clienteling for your business, you can visit the appropriate page to get started: Clienteling App for Small Retailers or Clienteling App for Enterprise Retailers.
Some of the images used are from Unsplash – we thank you forever!