Let’s be real: Most customers have less spending money than they used to.
With inflation up by 8.5% year over year, buyers are starting to pay more attention to price tags and cut back on non-essential purchases. Nearly half of consumers in the U.S., the U.K. and Australia said they’d deliberately curbed their spending due to cost of living concerns.
So where does that leave you as a merchant? How can you encourage customers to continue shopping with you, even as they cut back on other goods and services? The answer isn’t necessarily cutting your profit margins – there are many ways to make a customer feel comfortable with your brand, and many of them come down to the value of the experience they receive.
Here are some strategies for helping your customers feel good about shopping with your brand even when times are tighter than usual:
- Offer free shipping
Offering free shipping is a key strategy for convincing shoppers who may be unsure of an initial purchase. By offering free shipping on all purchases over a certain value, you’ll be able to encourage a higher average order volume – or by offering free shipping on all orders, you’ll be far more likely to win over customers who might have otherwise chosen a retailer with more generous shipping policies. An NRF study found that 75%of customers expect free delivery, even on orders under $50.
- Integrate BNPL solutions
If you sell an expensive product or service, or your customer wants to buy many items at once, they may not be prepared to foot the entire bill at once. Offering payment installment plans with a “buy now, pay later” (BNPL) service can help customers divide the purchase price into a set of easy payments that they can budget for more easily.
Integrating a service like Affirm, PayPal Credit, Shopify Shop Pay, or any number of other options makes it easy for customers to instantly apply for and get a loan with low- or no-interest, so that you can receive the entire payment amount minus a service fee without being on the hook for the customer’s loan.
Although it’s standard practice to “upsell,” or offer more expensive product alternatives to your customers, “downselling” means offering lower-priced alternatives to the product they’re considering. Particularly if a customer hasn’t made a purchase in a while, spotlighting lower-cost alternatives can help you nab a sale if the customer might otherwise bounce.
- Price match guarantee
When budgets are tight, many customers will spend hours comparison-shopping and seeking out the best deal on a particular product – and many retailers constantly track their competitors’ prices to make sure that they can stay in the game. By offering a price-match guarantee, your customers can buy from you with confidence, knowing that they can receive a partial refund if they see a lower price from one of your competitors – and your team won’t need to spend hours scanning prices anymore.
- Run abandoned cart campaigns
If a customer adds items to their shopping cart and then abandons it, they may be experiencing some sticker shock and not feel ready to buy at that moment. Don’t give up on them – they may just need a little extra time and a prompt. Running abandoned cart email campaigns have been shown to increase the conversion rate by 10%. You might even incentivize your customers to make a purchase by adding an extra discount for checking out within a certain amount of time.
- Showcase your ROI
Is your product an investment that will pay off for its customers? Do you offer a higher-quality, more durable product than your competitors that will last longer? Showcase data points that will help your customers understand your product’s value, and why it’s worth putting their dollars into your product instead of a competitor’s.
Take author Terry Pratchett’s quote on boots, for example: “But the thing was that good boots lasted for years and years. A man who could afford fifty dollars had a pair of boots that’d still be keeping his feet dry in ten years’ time, while the poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time and would still have wet feet.”
- Offer targeted discounts
By segmenting your audience, you can easily identify customers who haven’t made a purchase in a while and are at risk of churning. You may see indications that they’re still engaged with your brand, by opening your emails or visiting your website, but they haven’t pulled the trigger on buying anything recently, possibly due to price sensitivity.
Keep these customers in your funnel by offering a limited-time discount – you can even customize it to the category they’re most interested in, with personalized recommendations that are likely to entice them.
- Be flexible on returns
When every purchase counts, it’s important to make it clear to your customers that they can return an item if it doesn’t work out, no matter what the reason is. Provide a clear return policy on your website with a generous returns window (30 to 45 days is standard), and free return shipping.
Providing a great post-purchase experience is crucial, too: Rather than routing customers through customer support for help with a return, empower them to initiate their own returns with a self-service returns management platform like Loop, so that they can print out a return shipping label or take their product to a drop-off location instantly. By taking the friction out of returns, you can facilitate more sales from customers who may not have taken the leap otherwise.
Want to learn more about how you can use a best-in-class returns solution to win over price-conscious customers? Try out a demo of Loop.