As technology advances at a breakneck speed, retailers must quickly evolve sales approaches to keep pace with changing customer behaviors and expectations. Now, instead of solely interacting with salespeople through an in-person or telephone engagement during business hours, customers have the option to bypass salespeople and operate on a completely self-service basis. With the growth of 24/7 digital browsing and buying through smartphones, wearables, tablets and more, customers have come to expect a personalized, on-demand shopping experience every time. For example, many customers who interact with a salesperson in a brick-and-mortar environment are now expecting the same tailored service that online storefronts deliver. As a result, retailers face increasing pressure to deliver a seamless, consistent and tailored experience across every channel. Those that don’t are at risk of lower customer satisfaction, missed sales opportunities and long-term revenue decline.
Opportunities in customer data
As changing behaviors create greater pressure, the opportunity to thrive in the modern retail era is also evolving. Highly successful retailers are finding that one thing matters more than ever: unlocking the power of data, a largely untapped resource.
In the past, retail organizations retained customer data merely as a record of sale. However, when mined and correlated across data sources, both internal and external, customer data becomes much more than a simple transaction – it becomes impactful.
With no shortage of sources to draw data from – CRM systems which integrate marketing and sales campaigns, loyalty programs and in-store and online customer transactions – the potential for deriving insights through advanced analytics is vast. By mining information from these (and other) sources, firms build a more complete picture of each customer, and can better anticipate customers’ wants and needs. Once that information is available to your sales teams and marketing engines, you’re equipped to provide more tailored customer engagements that drive greater sales.
We’ll explore each of these possibilities in the following sections.
Personalize promotions and experiences
73% of consumers prefer to do business with brands that use personal information to make their shopping experiences more relevant (Digital Trends).
The message for retailers today is clear: personalization is king. In the past, if you wanted to purchase a product, you had to physically go to a brick-and-mortar retail location. The shopkeeper would see what you bought – week after week, month after month – slowly accumulating a basic knowledge of you as a customer. If the shopkeeper were really keen to drive sales, he would take more than just a mental note of your purchasing trends and personalize his sales approach – promoting items specific to your interests. Today, anywhere, anytime commerce is the norm and data is the new shopkeeper. Browsed online for a crochet hook? Guess who just stocked yarn.
Advances in technology and analytics present retailers with the opportunity to draw deep insight from their data. Understanding your customers on an individual level unlocks a host of new, powerful sales tactics to supplement the modern retailer’s toolkit.
Using customer metadata, QR codes scans, and Wi-Fi check-ins enables your organization to push location-specific coupons, offers, and information to customers. You can even use real-time location data triggered by external sources such as weather forecasts, sporting events, or even customer proximity to your store, to push relevant content to customers. Similarly, you can equip sales teams with a view of a customer’s history and preferences, enabling relevant, individualized engagement – for instance, directing a customer to a relevant promotion. With this technology, you don’t have to solely rely on a salesperson’s memory to delight your customers and meet your sales goals.
Anticipate customer demand with predictive analytics
Average Days Inventory Outstanding (DIO) raised approximately 8.3% from 2009-2014 (REL vis scdigest).
The most highly-personalized marketing won’t do you any good if the customer arrives in store and an item they are interested in is out of stock. Issues like overstock and out-of-stocks point to a disconnect between sales capacity and inventory management process. Stocking issues can have serious consequences – inhibiting the sales cycle or creating unnecessary costs.
Close the gap and cut down on inventory inefficiencies by using data to augment inventory management processes. Predictive analytics algorithms can help you make predictions about customer buying patterns in a particular area and prepare for spikes or lulls in sales performance. The ability to dynamically adjust your inventory allows you to ensure stock levels match consumer demand and cut down on inefficiencies.
For example, imagine that the weather forecast predicts a heatwave through your town. By analyzing historical consumer buying patterns, you find that you typically triple the sales revenue of popsicles when the heat surpasses 98 degrees. In response to these two data insights, you automatically trigger an increase in your popsicle order, quickly tripling your stock and your sales during the following two weeks. This kind of predictive analytics involves pulling in data and analyzing data from a host of sources, including weather applications, social media, and historical sales data.
Connect your sales team to data–and to customers
78% of 18 to 34-year-old consumers expect a customer service agent to know their contact and product information, as well as service history when they contact a brand for assisted service. (Global State of Customer Service Report 2016).
One of the greatest advantages of today’s data analytics capabilities is that they can free up your team, enabling them to direct their attention and creativity towards more strategic activities, like forging connections with customers.
Brand loyalty hinges on the interaction between the customer and your sales and customer service teams. Empowering your workforce by providing critical customer information is an important step towards building trust and delivering an excellent experience.
The ability to look into a buyer’s history—to see email communications, call logs, online purchases, previous store visits, and more—all in a single, unified view, provides sales employees a far greater understanding of each customer and their individual needs. It also gives the customer a consistent experience across your digital and physical storefront. With cloud-enabled sharing apps, this data can be provided to sales reps in real-time, and even on the go.
Imagine the potential this has for customer interactions: instead of pestering the customer by repeating the same questions each visit (i.e. What size are you looking for? Do you want to open a rewards account with us today? What’s your home zip code?), sales reps can confidently engage customers and deliver seamless experiences.
Taking the first step
Despite the opportunity that modern, cloud-driven data analytics holds for retailers, many organizations remain hesitant to take the first steps towards using it, often citing expense, lack of control, or security compliance as their top concerns. But the truth is, many of these concerns have been addressed— technologies such as analytics engines, cloud-based apps, and cloud storage have advanced to the point that these fears can be put to rest.
Microsoft’s advanced analytics solutions offer a scalable, cost-effective, and familiar approach to data analytics for both cloud-based and hybrid environments, without compromising security. With years of experience developing solutions specifically designed for the retail industry, we’re positioned to help your organization capture the power of data.
To find out more about our retail solutions and learn more about how to start transforming your business with data, visit our digital retail hub to explore products and solutions to help you at every step of the way. You can also learn more about the next generation of Microsoft’s data platform announced at this week’s Microsoft Data Amp event and re-watch the live event and keynote on-demand here.
LinkedIn: ShiSh Shridhar