Hong Kong’s retailers should be agile like a tiger ahead of the Lunar New Year shopping season

A customer experience strategy for Hong Kong retailers

Hong Kong’s revenue in the eCommerce sector is projected to reach US$24.2 billion in 2022, according to figures from Statistica. This is forecast to grow to US$38.3 billion by 2025, with a compound annual growth rate of 16.56 percent. 

With the Lunar New Year fast approaching, in what has traditionally been the busiest shopping season in the Chinese calendar, a peak in sales is to be expected.  

To better address this, retailers should take a closer look at the overall customer experience they are providing, and make any necessary adjustments to their storefronts and programmes.  By implementing a comprehensive Customer Experience Management (CXM) platform, brands can turn customers into loyal fans. The focus being on delivering data-driven customer experiences to build competences and identify new opportunities.

Outlined below are five strategies for the city’s retailers as they seek to make the most out of the holiday season and bring a sophisticated CXM system to life.

1. Elevate customer experience by providing value-added services 

Starting with a couple of big players, Hong Kong retailers are adopting a B2B2C model more and more by introducing value-added goods and services beyond current offerings to their customers. Loyalty Marketplace is one example of how brands deepen their understanding of customers and evolve customer experience. 

By offering a variety of goods and services for redemption, retailers are able to gain a better perspective of their customers’ interests beyond their usual product purchases. Loyalty can be maintained because of the higher perceived value deriving from the loyalty points. 

For instance, if a store only sells mobile phones, then loyalty points can be only used to redeem phones. However, if the programme is expanded and members are allowed to use points for purchasing yoga classes, sports gear and Japanese restaurant meals, then the retailer gains additional knowledge about the customer. In turn, the customer derives extra benefit from the points scheme and is more likely to stay with the company.  

For example, Asia Miles is using Adobe’s Digital Experience solution to deliver personalised monthly statements to over 12 million members worldwide with communications conducted across email, website and its mobile app. All marketing campaigns are personalised for each individual member, including specific offers and gifts.  

2. Data-driven and experience-based commerce has become a must

Whether interacting with the brand online or in-person, customers expect a personalised, seamless and connected experience across all channels. Businesses will need to put the customer at the center, and stay focused on the customer experience as much as they are trying to achieve online sales records.

An experience-driven commerce model will require a full understanding of the consumer, and their wants and needs. Data-driven approaches give brands the insight needed to define their customers, map experiences to their journey, create personalisation experiences and even discover new customers who fit the audience profile.

Hard and soft capabilities are needed to turn data into worthwhile information capable of delivering actionable insights.  The hard capabilities refer to the physical infrastructure needed to manage the process of acquiring data.  Soft capabilities are about the careful segregation of first- and third-party data to better understand a business and its customers, and using it to continually improve operations.

By having the right systems and processes in place, it’s possible to methodically organise first-party data, then enrich it with the inclusion of data from external sources to gain more value from it.

3. Drive conversion through seamless customer experience across multiple platforms

People are interacting with organisations via email, mobile apps, online video, websites, social media, and more. They navigate a complex and non-linear journey on their way to content and information. Social media platforms are becoming more and more effective in drawing a new crowd to a retailer’s website. 

New technologies, such as Live video-streaming, are becoming mainstream and can be incorporated into the retailers’ discovery and conversion process. In China, livestream e-commerce is, by far and away, the fastest growing trend. During last year’s Singles’ Day in China, total gross merchandise value (GMV) of livestreamed ecommerce was 131.9 billion yuan (US$20.7 billion), up 81 per cent from a year ago, according to data provider Syntun.

However, social media sites are not the end-destination themselves. It’s best to treat them as the touchpoints on the customer journey and aligned social media strategy with the unified brands’ digital strategy. Channels keeps changing, but the customer journey stays the same. Brands must be able to track engagement across all channels and react in real-time, and drive conversion by orchestrate a holistic customer journey.  

4. Create a unique shopping and delivering experience  

It’s not just online shopping. In-store pickup, delivery, and numerous other options -- such as delivery to smart lockers -- have also skyrocketed in Hong Kong. According to Adobe’s real-time “2019 Holiday Online Shopping Trends” report, buy online pickup instore (BOPIS) usage for the five-day period grew 47.8 percent year-over-year (YoY). And consumers were 20 percent more likely to purchase with retailers that offered BOPIS vs. those that didn’t. 

To stay resilient, companies need to make decisions that evolve their business faster than ever before. By implementing more options for consumers, brands are creating differentiation in the customer experience. For example, housewares retailer Pricerite’s online store can achieve delivery within four hours by adopting Adobe’s B2C solutions and checking the nearest store with stock across all channels. Such speedy delivery provides a key competitive edge, especially for last minute purchases, such as gifts. 

5. Commitment to data privacy sets brands apart

Hong Kong consumers who enthusiastically shifted to digital channels during the pandemic now expect the brands to not only know them, but also be respectful and committed to their data privacy. Just over two in five customers are frustrated when companies fail to deliver relevant, personalised experiences; however, one in two are concerned about data privacy when they subscribe to personalised services. 

The key is to empower customers to decide whether, when, and how they would like to engage with the brand. For companies, this means having a powerful data strategy that combines effective data governance with the management of customer permission. Additionally, brands must encourage customers to offer relevant information by way of value exchange. The value of these exchanges includes better personalised services, transparent and open information about how data will be used, as well as enabling customers to authorise and manage their personal data as they wish.

Following these recommendations will leave you well-positioned for success this holiday season. Be mindful that building a long term CXM strategy is a lengthy and evolving process in which Chinese New Year can be used as a good entry point which can be used to improve platforms over a longer period of time.