Conventional wisdom rules. Retailers finding the key to success today is not so different to 20 years ago. The fundamental goals include attracting new customers, retaining existing customers and continuing to increase sales. However, digital transformation, both to retailers’ internal processes and technologies and external customer expectations, is driving the need for a new method to achieve this desired success.
Major factors such as customer sentiment and brand image help drive customer retention in today’s market. By understanding customer sentiment alongside delivering a consistent brand image, retailers will see an improvement in customer retention and consumer relationship.
This is made possible through the collection and analysis of data. Data Analytics involves the processing and organisation of large amounts of data that create insights, correlations and trends to improve business operations.
As a result, data analytics appears to be the differentiating factor between retailers who will thrive and those that will struggle to maintain the competitive edge.
The exponential growth of product information available to consumers and, in turn, the level of information available about consumers has completely transformed the retail industry.
Consumers are able to use data available online to research, compare and buy products. So, data essentially helps the customer make informed decisions about a product from anywhere at any time. Today’s shopper is constantly moving across buying channels – enabled by e-commerce on the web and through mobile shopping – even as they interact with brands through brick-and-mortar stores.
This provides both a challenge that retailers must tackle (delivering a consistent omni-channel experience by breaking down data silos) and a new opportunity to attract and retain customers. By using retail data analytics to uncover and interpret online and in-store shopper patterns, retailers can stay ahead of shopper trends and deliver the unique brand experiences that become their USP – how to retain their most valuable customers.
The Importance of Data Relevance
For the retail industry, the prevailing customer sentiments determine the latest trends that inform decision making – from product design and manufacturing, to marketing messages.
We have seen an increased focus on data analytics as a necessity for all industries – but particularly for retail, where accurate and up-to-date data is critical to meet customer demand that rapidly fluctuates.
The cyclical nature of the industry means that trends can be long, medium, or short-term. Harnessing the power of relevant and timely customer insights is the key to meeting consumer demand consistently and maintaining a relevant brand image.
To succeed today, retailers will increasingly need to rely on up-to-date data harmonised across data silos to make key business decisions and drive customer retention.
Improving the Customer Experience
Retailers can use data analytics to discover requirements from shoppers and make customer-centric product manufacturing and marketing decisions on-the-fly. Using data to optimise stock levels, available sizes based on customer demographics and sending relevant offers in one-to-one personalised email campaigns, based on purchase history, are all made possible through the deployment of cross-company data analytics.
Retailers can use data collected at every touchpoint with customers to improve satisfaction, engagement and customer loyalty by aligning all business operations behind customer-centricity.
In short, retailers can boost revenues by delivering a seamless shopping experience.
Better Strategic Decisions
We often find that the various departments of retailers work in silos – both structurally and with the data they collect. The impact this has on a company’s ability to use that data effectively is two-fold. Potential data insights are fragmented and trapped in pockets of the company.
To attain real value out of data analytics, retailers need to consider aggregating their data across disparate systems into a single, unified view throughout the organisation. Once in place, retailers will gain true insights which will help plan customer retention strategies – including personalised offers, pricing and stock decisions.