Multiple channels, data mountains, transient customers, cost pressures, product sourcing, short-term fashion trends, constantly increasing customer expectations, personalisation.
Multiple channels, data mountains, transient customers, cost pressures, product sourcing, short-term fashion trends, constantly increasing customer expectations, personalisation. These are a few of the challenges facing the modern retailer, indicating why traditional marketing is finding it increasingly difficult to shape and generate leads from target customer groups, online and offline.
So how do retailers ensure they are responding and adapting for tomorrow, rather than reacting to last month?
Today, the battle for consumers starts long before they log on or walk down the high street - the real customer journey is shaped by social interactions and driven by the influence of peers. But it’s not enough to focus on increasing the followers of your brand, building favourites or maximising the volume of content. What matters is turning influence into action and commitment - and that requires personalisation on a whole new level.
While this is enabled by the smart use of technology, actual success comes from intelligent integration, a clear analytical framework, a strategic approach to marketing and an ability to respond rapidly to opportunities. Within this environment, ‘social data analysis’ is an emerging, effective means of identifying opportunities to manage and improve customer experience. Benefits experienced to date include better customer retention, increased average order value and reduced cost-to-serve. To move matters on to the next stage we are now partnering with social data analytics expert PeerIndex to apply our shared knowledge to building solutions for long-term customer value and boosting sales.
Often the most valuable consumers are those whose word of mouth brings in the most profitable customers - a previously hidden value called the ‘customer’s network value’.
Identifying and understanding these highly influential people from billions of social actions, down to their individual preferences, interests and relationships, enables retailers to make intelligent pricing and discounting decisions in real time, personalising the shopping experience based on their value to the business.
Such advanced personalisation techniques are enabling retailers to make more appropriate basket suggestions, increasing average order value and satisfaction and so driving increased sales through referrals. The value they leverage goes beyond the sphere of marketing across the entire business, with social insights and predictive analytics being used to enrich CRM, improve complaint handling, identify emerging issues and even improve credit-risk analysis.
One case in point is the analysis of the social footprints of one retailer’s customers, enabling the identification of the characteristics associated with high spenders. As a result, it’s possible to identify, attract and engage lookalikes - those most likely to become high spenders. Next, the retailer can pinpoint the existing customers who most influence them, with a view to marketing through them.
This is just the start of realising the potential provided by the smart use of new technologies, marrying retailers’ data with today’s abundant wealth of social media data.
- Dave Rumble Partnership Director, Serco