Feature: How Retailers Make Use of Big Data and Analytics to Boost Sales
We have seen an evolution of retail in recent years, with the rise of the omni-channel experience the most prevalent factor.
There has been a major shift in consumer purchasing patterns, with customers now buying from brands across multiple devices such as mobile, tablet, laptop and PC.
Data is booming across all sectors and disciplines, and retailers have the world at their hands by being able to gather a substantial amount of customer data and using it to drastically change the customer experience.
Let’s examine how retailers are using this data to gain an insight in to customer identities, purchasing trends and customer loyalty.
Providing consistent product information across in-store and online environments is an important step in engaging the customer with the retail experience. This is a large ask considering the amount of products that a retailer offers.
Add to this additional information that customers request such as product information, images and videos, expiration/use-by dates and so on - and this can seem like a mammoth task.
Product Information Management, or PIM, brings a new dimension to the omni-channel experience. In a retail scenario, product catalogue onboarding starts with PIM to get the latest product information.
A dataset in the relevant systems that is always up-to-date is a further basis, which allows companies to react immediately to market movements and implement marketing requirements as quickly as possible. Data must be exchanged between the systems practically in real time.
Rise of the omni-channel experience
Retailing started with one channel, the physical shop, and this extended to the call centre and catalogue shopping. Then came ecommerce, however, this was often implemented as a separate strategy and not integrated with the physical shop. Now, retailers are building other channels such as apps and mobile sites.
Shopping across different channels is now dubbed the omni-channel experience. Virtually everyone is a cross-channel shopper: 95 per cent of consumers frequently or at least occasionally shop a retailer’s website and store, according to the “Omni-Channel Insights” study by CFI Group. In the report, “The Omni-Channel Opportunity: Unlocking the Power of the Connected Customer,” Deloitte predicts more than 50 percent of in-store purchases will be influenced digitally by the end of 2014.
Customers today are making an “informed purchase journey” in which they research and talk about products online and use this information as a key part of their purchase process.
According to Google’s ZMOT (Zero Moment of Truth – the online decision-making moment), 70 percent of consumers research online before purchasing in-store. Combine this with the fact that the average shopper uses about 10.4 sources of information to make a purchase decision and you realise the importance of providing a great omni-channel experience.
However, when retailers start considering selling through a new channel, they need to ensure that the necessary groundwork has been put in place.
For example, bad translations of Alibaba’s international web content and technical problems preventing users from getting to the checkout page on Marks & Spencer’s website caused both companies to miss out on online revenue and created disgruntled customers.
With a variety of channels to choose from, and easy ways to compare prices, retailers are recognising the necessity of differentiating themselves and creating a unique customer experience.
Many supermarkets have loyalty programs which they use to offer customers additional services such as insurance policies and banking, however this strategy hasn’t led to increased loyalty.
One solution is to combine product and customer data to give customers a personalised shopping experience and give retailers a single, 360-degree view of the customer. Retailers can then send product recommendations and special offers directly to the customers preferred device taking in to account all the information to hand.
Personalised experiences will differentiate retailers and help increase customer loyalty.
The loyalty card
When Tesco first introduced its loyalty card it effectively brought all its customer data in to one place. Now with the fragmentation of data across social media, mobile sites and apps, companies need to rethink how data from different sources can enable effective interactions with their customer base.
Understanding an individual’s network rather than just simply their own transactions will uncover trends and potential new opportunities not otherwise identified. This can largely be achieved through the integration of social media data.
Combine this with an awareness of customers’ mobile activity and retailers can create personalised offers with tailored benefits in real time, which will drive revenue and create loyalty at the same time.
Technologies can simplify the task of managing and analysing the deluge of customer data to ensure that the required information is available and consistent across both physical and digital platforms. When done well it will help provide a competitive advantage and an engaged customer that is truly at the heart of the company.
I will finish off with three customer purchasing trends for 2015 that retailers need to be aware of:
- Mobile conversions are still lower than desktop purchasing according to internetretailer.com – This could be because customers are visiting the website on their smartphone and then completing the transaction on a desktop or tablet
- Final point of conversion – Customers are engaging with a brand through many different media channels over several days before they make the final decision
- Store fulfillment – Retailers will look to omni-channel solutions that can provide transparency about what is in stock to help manage customer expectations
By Ben Rund, Senior Director Product Marketing PIM & Procurement, Informatica