Boosting Customer Loyalty: The Importance of Transparency in Retail

Transparency is more than just a seemingly honest marketing message. Transparency means telling customers how you’ll process their data for everything from event registrations through to your online booking system. 

Here’s some tips for retailers wanting to build trust with their consumer base.

What is transparency in retail?

Transparency in retail means being open and honest with your customers about how products are made, where they come from, and how much they cost. It also means being transparent about your company values, practices, and policies. Transparency builds trust, and when customers trust a company, they return to the brand again and again over time.

Why is customer transparency so important?

Relaying the fact that younger generations place a high importance on brand transparency is a bit like saying older generations are obsessed with the original version of Macgyver – it’s a sweeping generalization, but it’s also a little too obvious.

But at a time of fake news, data breaches and general misinformation, younger generations of consumers aren’t the only ones who expect a high caliber of transparency from the brands they deal with. A study by Social Sprout found that 86% of consumers think transparency from businesses is more important than ever, and almost nine out of 10 consumers will stop purchasing from brands that lack transparency, and instead go to a more forthcoming competitor.

When it comes to the retail sector, a number of high-profile scandals have planted a seed of doubt in the minds of many consumers, resulting in a high level of mistrust.

Earlier this year the annual Fashion Transparency Index, which looks at the social and environmental policies of over 200 labels, found that the most transparent brands were Adidas, Reebok and Patagonia – each scoring 64% of the total points possible (the average is only 21%) – while brands Esprit and H&M followed closely behind.

To stay afloat in today’s increasingly complex and competitive retail market, brands need to invest in open, honest, trust-based relationships with their customers now more than ever.

How to be transparent with customers

Building trust with customers is essential for any business. Below, we’ve listed the three things you need to know to become more transparent. 

Own up to your mistakes

No one likes to air their dirty laundry, but today’s consumers have an active interest in the environmental and human rights policies of the brands they deal with, so being open and honest about your brand’s shortcomings, and taking an active stance to improve them, is a much better approach than trying to sweep things under the rug.

And while consumers are more critical than ever, they are also willing to stand by brands that own up to their mistakes and attempt to fix them. According to the same survey by Social Sprout, 85% of consumers said they would stick with brands during a crisis when they are more transparent overall.

Open up a two-way conversation

Instead of slamming consumers with an endless stream of corporate marketing messages and expecting them to respond in turn, be honest about who you are as a brand, understand who your customers are and what they want, and go about creating an authentic relationship with them. 

Respect your customers’ personal privacy

Being transparent about your human rights and environmental policies is crucial – but consumers are becoming increasingly concerned about their own personal privacy, too. A new survey from Acquia found 65% of respondents said they would stop using a brand that wasn’t transparent about how it was using their data. Customers are also becoming more and more skeptical about handing out personal information, with 59% saying they wait at least a month before sharing personal data with brands, and just under half (49%) saying they’re more comfortable giving personal information to brands that have brick-and-mortar locations.

Brands need to invest in transparent data policies and processes, but they also need to manage customer expectations on the shop floor. For instance, instead of writing down customer information like names, email addresses and phone numbers on notepads or clipboards when booking appointments, managing queues or taking sign ups for events, brands that take down personal data digitally will be able to put their customers’ minds at ease – not to mention avoid costly GDPR fines.

Become more transparent with Qudini by Verint

With GDPR-compliant Retail Choreography solutions, Qudini by Verint can help you to increase transparency while improving the overall customer experience. 

Get in touch to learn more.