Data drives e-commerce

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Data drives powerful results for retailers
Data drives powerful results for retailers

He says that Organic used consumer data to help develop a WalMart shopping app for tablets, which included the ability to navigate the store's extensive stock by curating the types of products they wanted to look at and building from that list.

Data innovations

Supermarket companies such as Ahold USA, parent company of the Stop & Shop chain, are experimenting with digital circulars to replace newspaper inserts, combining their loyalty program data with display ads to deliver offers to their customers. Harper says Ahold is showing seven-to-one ROI on targeted emails thanks to its analytics work.

Slicing and dicing email efforts is still the most popular use of databases among retailers, say experts. Not coincidentally, email and search remain the most popular forms of online marketing.

More involved tactics like microsites are expensive, and email is inexpensive, thanks to new affordable solutions, says Steve Grosklaus, EVP of the optimization practice at agency Arc Worldwide.

Email optimization is incredibly sophisticated now, with real-time modeling that allows for matching a subject line to an individual, as well as arranging for optimal time sends and far more extensive creative variety than in the past, Grosklaus says. The technology now allows for 100 different versions of an email by using different creative look and feel and not just varying offers, he says. The ability to segment email 100 ways means working more closely with creative teams to build a look and feel that works better with each segment, he adds.

“The thing that allows us to do that is all the information that's coming together,” Grosklaus says. In the last four to five years, there has been an explosion in both the amount of data available and the analytics infrastructure to handle it, including cloud-based solutions that put data mining and segmentation within the reach of more users, he explains.

Q&A: Aaron Magness, VP of marketing at Coastal.com

Coastal.com VP of marketing Aaron Magness on the growing importance of creating a personalized experience.

Click to read full Q&A.

“Within the next few months, it's going to feel like everybody is doing it … The market infrastructure is really maturing,” says Organic's Harper. “You have this really nice evolution where you have partners who are really smart about database management and segmentation that are linking these disparate sources together. That's the backbone,” he says.

However, even as analytics are expanding to keep pace, the retail market continues to become even more complex with the addition of mobile shopping and the surge in the use of tablets, which have added another channel to segment and understand. According to IBM, 90% of the data available today has been generated in just the last two years.

One of the biggest challenges in tailoring retail experiences to shoppers is just sorting through often redundant data from multiple touchpoints, experts say. Getting shoppers to part with information is becoming less of an issue than dealing with the mass of data being spun off from every channel in the new “omnichannel” retailing industry.

A recent Forrester Research study noted that most retail transactions involved at least two touchpoints, some both online and offline; attributing the sale to one or another is a challenge that retailers will increasingly face as they create online experiences that dovetail across in-store, online and mobile shopping channels.

“Marketers must start thinking about how to turn their big data into smart data,” Digitas' Miller says. “They're paralyzed by their own research.” The first step, most industry observers agree, is focusing on what the retailer wants to offer customers, the better to sort out which data will help to that end.

“The onus though is still on the retailer. What are we trying to accomplish and what are we trying to fulfill? That is the experience that's at the front end. Then you can figure out what's the best tool to use,” says Aaron Magness, VP of marketing at Coastal.com.

The eyeglass e-tailer is carrying out a business intelligence review that includes acquiring IT to better parse customer data. Coastal.com already serves up content based on a visitor's past shopping patterns or the type of display ad that a new visitor clicked on to arrive at the site, and it has added a recommendation engine. However, in this competitive environment, that's not enough, sites need to be continually improving and personalizing the online experience, Magness explains.

“The amount of data becomes manageable if you know what data is relevant,” Arc's Grosklaus says.

Developing a comprehensive strategy is going to require marketers to develop new skills to handle social media and mobile shopping data, but also to integrate silos to marry data from one channel to another as the tools allow, experts say.

“The biggest database developments that I've seen don't have to do with infrastructure,” Digitas' Miller says. “The real developments are [finding] marketers and statisticians who know how to work with data in real time to drive their business forward. The biggest developments are the new statistical skill sets [and] how marketers are using the new tools for their databases, ” Miller adds.

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