Ten steps to improving retail marketing performance in a multichannel world
Consumer behavior and preferences - how, where and why people choose to get information and shop - have changed dramatically in recent years, requiring retailers of all sizes to alter how they market brands.
Today it is not a matter of if retailers will need to integrate customer data and seek to optimize the value of each customer relationship, but a matter of how and when they integrate data in order to drive desired customer behavior and preferences.
Here are steps that leading retail enterprises are using with success to optimize customer relationships:
• Decide how the organization wants to view its customers. The first step toward establishing a single, unified view of customers is to develop a roadmap incorporating readiness and gap analysis, business strategy and a customer-centric vision with the goal of capturing and collecting customer data from all relevant sources and gathering them into a single repository.
• Unify and share the view of the customers. Beyond consolidating the data into a single repository, cleansing the data, organizing the data and appending the data for completeness, make the data available across the enterprise to enable informed decisions beyond the marketing lane. Merchandising, real estate planning and product development are among the parts of a retail organization that can put such data to profitable use.
• Use knowledge of customers to understand and predict behavior. Successful retail organizations use customer data to see and understand patterns of behavior, to shape overall marketing strategies, and to identify, refine and target segments. Using knowledge of customers, retailers are then able to customize relevant media and messages.
• Execute dynamic and trigger-based marketing. Leveraging data-driven marketing communications technologies such as email, personalized Web pages, print-on-demand and permission-based voice messaging calls enable retail marketers to deliver truly customized and relevant messages at the optimum time.
• Develop customer investment plans. The ability to predict customer behavior is a powerful tool which empowers retail marketers to gain insight into budgets, and as a result, where to direct strategic and tactical efforts. Developing models that project the financial impact of these strategies and tactics, on a segment-by-segment basis, is key to marketing planning.
• Develop multichannel understanding and communication. Retailers that have integrated channel (in-store, Web store, call/contact center, etc.) information, activities and performance report a deeper understanding of how customers browse, search and buy, and how the channels support (or fail to support) each other.
• Integrate key customer processes across channels. While the customer-facing processes do not need to be executed in exactly the same way, such efforts as promotion redemption, returns and inventory checks must be able to cross sales and service channels.
• Standardize methods to measure marketing performance. The goal is to measure and report all customer interaction points from all channels with the same precise definitions to ensure results are meaningful and translate throughout the organization.
• Develop dashboards of specific and well defined key performance indicators. With fundamentals in place, dashboards give retail executives real power to guide strategic decisions and tactical programs in a timely manner. Adding a customer-centric lens to the dashboard - through such metrics as margin and revenue shift per customer/segment, revenue per acquired target, net impact across segments and more - gives executives the ability to look at the power of their strategies and investments based on their contribution to the value of customer segments, over time, rather than on simply a campaign-by-campaign basis.
• Develop customer communications strategies that leverage all of these practices. The goal is to direct retail marketing dollars with clear knowledge of who the customer is, what messages to deliver and why, when to deliver them and how, and the return to expect on each marketing investment individually and collective investments over time.
Today's customer may no longer be considered a single entity at a single place and time. As customers continue to use diverse channels to educate themselves and to buy and communicate, increasingly it is essential for retailers to gain an accurate, total view of each customer to enable relevant messaging and effective crosschannel relationships.