It’s costlier than ever to acquire new customers, and all it takes to lose a customer is a single poor interaction. Baby Boomers (the demographic with the most disposable income) report the largest decrease in loyalty, with only 19 percent of them saying they are more loyal than they were five years ago. This is in stark contrast with the 53 percent of retailers who believe customers are more loyal overall.1 What can retailers do to differentiate and win over brand loyalists?
Retailers run promotions for many reasons and have differing capabilities. You can take the shotgun approach where you're promoting the same offer to everyone, say a BOGO. Or, perhaps, you are more sophisticated in your ability to target customers with custom offers to drive increased conversion rates. The modern retail environment demands an integrated approach where data from all customer touchpoints are considered and offers are automated through a scientific approach.
Customer-focused retailers who deliver the right product and promotion through the most effective channel, at the right time, individualize promotion. The net result is not only a personal offer but one that is relevant and delivered at the most appropriate time, thus improving the customer experience and maximizing business priorities (e.g., revenue, margin, sell-through). This idea goes beyond the tactical goal of simply driving redemption rates. To achieve this level of individualization and appreciate its impact, retailers need a holistic, omnichannel view of customer shopping behavior across every channel from ecommerce, order management, and in-store point of service. This critical information must then also be combined with engagement insight gleaned from pre and post-sale activities occurring online and on social media, and analyzed through models that continuously learn and improve to provide insightful recommendations.
A fit-for-retail-purpose customer relationship management (CRM) platform integrates customer insights to drive and support omnichannel customer journeys. It enhances the customer experience by bringing personalization and relevance every step along the way. When done correctly it establishes enduring customer relationships based on value, not just price. This isn’t just a nice idea. Adopting this strategy returns strong financial performance. Retailers with a true 360-degree customer view experience growth rates of earnings between 10-11 percent, compared with just 2-3 percent on average for their main competitors.2
Marketers have a significant role and responsibility for shaping and maintaining the customer relationship. Customer-centric retailing demands that marketing communication serves the consumer across the pre-shop, shop and post-purchase phases of the journey. Each of these interactions represents moments of truth where a brand has an opportunity to influence the relationship and transform a consumer into a brand champion.
With 42 percent of customers shopping both online and in-store every week3, there is a need for omnichannel excellence by retailers as customers increase their number of touchpoints. One way to win shoppers is through a personalized offer, giving them a reason to come back. In fact, 52 percent of consumers globally want personalized offers based on personal data from their store loyalty account.
The data all points to the simple and possibly obvious conclusion that consumers respond more readily to a unified experience across the shopping journey. Your customers want you to know who they are – they have a desire to be understood and engaged, and they want personalized offers.
There is also plenty of survey data to support the premise that, from the retailer’s perspective, this is easier said than done.
Omnichannel retailers have particular operational challenges in this regard. One challenge I hear often involves “single point of entry” and “single point of execution.” Oracle Retail Customer Engagement Cloud Services (ORCE) focuses on unique retail challenges like this. The platform seeks to align operations, marketing, and merchandising functions around the customer and assist each to deliver an increased level of personalization. ORCE further addresses the challenges of personalization through integration with Oracle Retail Offer Optimization. Offer Optimization uses AI and machine learning technology to match consumers and offers with unprecedented accuracy. The combined result is that the customer sees personalized offers appear in her ‘promotional wallet’ at just the right time. Importantly, this is a cycle of continuous improvement where the stream of individual offer and response data helps the system become better and better. Increased level of customer satisfaction, increased return on marketing investment, increased operational efficiency and reduced margin erosion? That sounds like an outcome everyone in a retail organization can get behind.
Putting the customer at the center of your retail business is more important now than ever. Let us show you how a CRM built for retail makes all the difference. Request a Demo.