Would you be surprised to learn that companies with a strong retail data strategy grow revenue up to 2.9 times faster than companies without one? Or that 73% of customers expect companies to understand their unique needs and expectations — a 7-point rise in just two years? Keep those numbers in mind this shopping season because they could affect your revenue and growth.
Creating personaliszed experiences based on collected customer data, also known as first-party data, is an increasingly critical part of retail data strategy. Despite this, only 32% of retail executives say they can turn profile information, purchase history, and service interactions into tailored experiences that make shoppers feel like VIPs. To stay profitable in this changing market, retailers need to meet the demands of must inspire budget-conscious customers. To do that, they need to prove they understand their customers’ needs and expectations.
Here’s how to acquire and engage customers this shopping season.
Use customer data to personalise every interaction
First-party data helps you tailor offers and messages to your customers’ specific interests. The payoff is huge: 78% of consumers say personalised email and other messages make them more likely to repurchase in the future. However, simply accumulating huge quantities of data isn’t enough. You also need to know what to collect, when to collect it, and how to use it. The challenge is to not drive customers away by asking for everything at once.
To level-up your retail data strategy:
Avoid intrusive demands
During the shopping season, customers’ patience tends to wear thin. Their interest in completing a long customer profile is probably low, so be strategic about what you ask. Focus on data collection that will enable you to follow up with them after the purchase to learn more. Use a multi-pronged approach that balances frequency with relevancy, and stay away from sending mass email and generic communication when possible. The more you know about your customers, the more opportunity you have to tailor your messaging to inspire participation. With a personalised approach, you can collect more valuable information, like product preferences, later as you build trust.
Keep your loyalty program ready for the shopping season
Not only are loyalty programs an effective way to gather zero- and first-party data, its members are often your most valuable customers. But with consumers likely to shop less and from fewer retailers this shopping season, your job is to make sure your members think of you first when they’re making shopping lists. How? By ensuring your loyalty program delivers the best value exchange possible.
While traditional rewards-for-transactions arrangements will remain important as consumers get more budget-conscious, don’t overlook the intrinsic value of the VIP experience. That’s especially important for millennial and Gen Z shoppers who value exclusive access to limited-edition products and experiences nearly two times more than Gen Xers and baby boomers. So, from priority sale access to complimentary gift wrap, ensure your members feel the data-for-rewards exchange is worth the effort.
Connect data across the full customer lifecycle
Busy shoppers don’t have time to waste. They don’t want to repeat themselves on the phone, explain an online promotion to a store associate, or make an extra trip to the post office because they can’t return a purchase in person. The bottom line? Your customers expect you to bridge physical and digital interactions. By elevating data from sales, service, marketing, and commerce to a shared customer data platform, you’ll gain the 360-degree view you need to ensure every interaction stays personalised, consistent, and on-brand.
Segment audience data to automate relevant communications
Shoppers are inundated with emails, texts, app notifications, and social media advertising. Your retail data strategy needs to stand out from the crowd and capture their attention with intelligent messaging that’s tailored to their specific needs and interests. But how?
By organising your customer data based on shared attributes, you can target the audiences most likely to respond to customiszed messaging. For example, imagine you’ve created a segment of customers in a certain region who are on the waiting list for gaming equipment. You’ve recently restocked that region’s store shelves with popular consoles, headsets, and controllers. Segmentation and automated messaging enable you to alert interested customers that the items they want are back in stock. But even better, you can also send communications to lookalike audiences who have purchased gaming equipment from you in the past — and that’s the kind of personalised experience that drives revenue.
Make online experiences intuitive, wallet-friendly, and fast
To grow margin in a challenging economy, you need to do more than tailor communications to customer preferences. Your retail data strategy needs to capture the attention of your first-time shoppers at the right moments and then make it easy for them to buy.
Use data from existing customers to create:
- Intelligent product displays. Offer relevant recommendations on the pages where customers are shopping, like athletic socks alongside sneakers. But don’t display just anything. Deliver a good customer experience by ensuring the products are in stock (or at least available for on-time shopping season delivery).
- Money-saving promotional bundles. Budget-conscious shoppers don’t want to waste money or time. Reduce taps to discovery and increase average order volume by combining closely related products into wallet-friendly bundles. For example, offer a treadmill alongside a fitness tracker, workout wear, and hand weights.
Personalised (and fast) checkout. With 71% of traffic coming from mobile devices in the second quarter, it’s never been more important to optimisze commerce experiences for smaller screens. Invite new customers to create a profile with their payment preference and enable “buy it now” on mobile product pages to ensure they can breeze through checkout.
What’s next for your retail data strategy?
A difficult economy and shifting consumer sentiment are creating yet another year of unprecedented challenges in retail. You’ll need to use every tool you have to acquire new customers and keep loyal shoppers coming back for more.
With the right retail data strategy and streamlined digital experiences that address busy shoppers’ needs, you can keep your customers happy from double-digit shopping festivals to Black Friday and beyond.
This post originally appeared on the U.S.-version of the Salesforce blog.
