Valitor explains how retailers can stay ahead of the game by leveraging data to understand real customer personas.

Data is a brand’s most important toolkit – but fail to understand it or use it for the right purposes and you run the risk of damaging customer relationships.

Brands that use data to cultivate long-lasting customer connections use it to transcend traditional consumer demographics and address the individual needs of their audience personas.

Today, in a world where consumers have a greater understanding of their data and how it can be used, it’s time to look at the new expectations from consumers and how to navigate a path that delivers long-term value.

Prioritise personas

Gone are the days of defining customers based on demographics alone; customer types are so much more nuanced than this.

Instead of treating them as a number, brands need to put customers at the very heart of their mission and business plan, building a stronger and deeper relationship.

To do this effectively, brands need to know what customers really want from a retailer. Findings should then be central to decision-making processes, helping to ensure that meaningful relationships are developed.

“Instead of treating them as a number, brands need to put customers at the very heart of their mission and business plan, building a stronger and deeper relationship”

The good news is that customers are happy to share insights with brands. Retail Week research highlighted that nearly half (47%) of consumers are happy to hand over their data if it means they get a better customer experience.

However, these findings also clearly indicate that this data needs to be utilised in a way that offers the personalised experience customers demand. To do this in an authentic way, a brand needs to look at several data points.

As well as looking at the life stage and socio-economic background of the consumer, it should also use data from past transactions and interactions to understand exactly what a consumer likes and wants.

Using this extra data helps develop a customer persona, which is integral to creating the personalised experiences consumers need.

It is important not to confuse this new level of personalisation with previous methods, which relied on demographic-based analysis and often led to segmentation based on stereotypes rather than data-led insight.

Stereotyping in this way means insights could be lost or overlooked.

Deeper data analysis, for example, found that older shoppers are in fact more open to in-store technologies than people might think.

In contrast, younger shoppers are actually less keen for in-store tech. The more ‘faddish’ gadgets in particular, such as augmented reality, are often found to miss the sweet spot with millennials, Generation Z or the emerging Alpha generation.

“Using data-led personas can enable much more sophisticated marketing techniques, as well as ensuring simple, on-demand and appropriate communications to suit the audience”

It is therefore better to use personas to understand what products customers purchase and are interested in, and how they like to shop.

If brands wants to win the hearts and minds of customers, they need to start talking to them in a more genuine way.

Using data-led personas can enable much more sophisticated marketing techniques, as well as ensuring simple, on-demand and appropriate communications to suit the audience.

Education on personalisation

The reality is that most brands cannot compete with retailers such as Primark on price, Asos on range or Amazon on fulfilment.

Instead, educating customers on data usage and developing detailed customer personas means brands can use personalisation as a differentiator.

In today’s tough retail climate, prioritising personalisation is crucial to standing out and winning customers.

The trouble is, few consumers are currently getting the personalisation they want. Worryingly, 32% of consumers think that retailers don’t care about them as a customer after completing a purchase.

Combating this and creating brand advocates will require a focus across the whole customer journey, from marketing all the way through to payment and fulfilment.

“Instead of waiting for rules and regulations around data to catch up, brands have an opportunity to establish a leadership position”

While GDPR has certainly changed the game, it is likely only the start of data legislation.

Instead of waiting for rules and regulations around data to catch up, brands have an opportunity to establish a leadership position.

Setting the tone for data usage and personalisation will not only keep them one step ahead of regulators, but will also benefit the relationship they have with customers. 

In doing so, brands can start to own conversations with their customers and build personas that will help them win in retail.

Andrew Howell

Andrew Howell is head of marketing, omni-channel solutions, at Valitor 

Learn more about the downfall of traditional demographics here.