Local retailers who engage more with their communities may have success competing with large online retailers, according to a recent study from the University of Alabama at Birmingham’s Collat School of Business.
Engaging with the public builds consumer trust and commitment to the retailer, making its economic value proposition less important, according to the study by Donald Lund, associate professor of marketing at the university.
“Our message to local retailers is simple: Build stronger relationships with your customers, and get engaged with the local community,” Lund said. “This research establishes community engagement as an important resource that both builds stronger relationships with consumers and allows the retailer to more effectively compete with online retailers.”
The study, a survey of more than 1,700 consumers, showed that as a shop’s community engagement goes up, the importance of its economic value proposition goes down.
Some initiatives that can have a big impact in the minds of consumers, Lund says, are: donations to civic groups, fundraisers, employee volunteerism, scholarship grants, sponsorship of community events and partnerships with other local retailers.
But, the effect of these and other strategies and their relative impact on community engagement perceptions still needs to be researched, Lund said.