We know retail is in a state of disruption. We know consumers’ shopping habits are changing. We know shoppers want a more personalized experience.
But most retailers don’t know how to adjust their strategies accordingly.
What We Know: Change in Retail Is Non-Negotiable
Change has simply become a matter of fact for the retail industry thanks to the rise of eCommerce, new channels for engagement and heightened customer expectations. Against this backdrop, we’ve heard time and again that the retailers that can’t keep up will get left behind.
Faced with the imperative to transform or die, retailers have spent the last couple of years trying to understand exactly what that transformation should look like. And by and large, most have a good vision of what exactly they want to accomplish.
Specifically, most retailers know they need to:
- Invest in online channels like email, social and mobile, where the customer journey increasingly takes place
- Focus on collecting and understanding massive amounts of customer data
- Connect data from across channels in order to paint the picture of the entire customer journey
- Use that data to make decisions that power more intelligent and personalized marketing campaigns
- Turn decisions into action to bring those campaigns to life
- Keep a pulse on customer data and campaign performance to regularly optimize efforts and identify new opportunities for improvement
What We Can Do: Retailers Struggle to Deliver Change
Despite all the progress retailers have made in identifying what they need to do to transform their marketing strategies, few have been able to deliver on that mission in its entirety.
According to a 2017 survey of 100 retail leaders conducted by Worldwide Business Research and Bluecore, many retailers struggled to achieve their KPI and revenue goals in 2016. Notably, 71% of the leaders surveyed cited piecing together customer journeys as a roadblock to success, with 57% pointing to aggregating and using data as a problem and nearly half citing difficulty building audiences for campaign targeting. In fact, only 39% of retailers rate their ability to use first-party data to inform marketing campaigns as “above average” or “excellent.”
As one respondent put it, his team’s inability to measure the value of their customers and act on those insights was a big contributor to lost revenue in 2016.
Notably, at a time when taking customer engagement across channels is quickly becoming table stakes, 59% of retailers say they cannot easily apply the same data from one marketing channel to another.
Of course many of these challenges boil down to a lack of resources, as retailers are limited by what the technology in their marketing stack can enable. And our survey found that those solutions come with their own challenges too.
What Lies Ahead: Delivering True Change in Retail
As the data makes clear, there’s a definite gap between what retailers know they need to do and their ability to deliver on that need. So what exactly does it take to get from point A to point B?
For 75% of the retailers surveyed, the answer lies in improving customer acquisition, loyalty and retention. And most of those retailers plan to revisit the tools in their marketing stack and increase cross-team communication to achieve that goal.
One respondent shares that the need to establish stronger, more natural relationships with customers drives all of these improvements. She says: “We have to enhance our customer relationships, as customer loyalty is a key necessity for us to grow and add revenue. We need to naturally extend our relationship to encourage customer loyalty.”
Another respondent echoes this sentiment, underscoring the need to create highly targeted customer segments so that the marketing team can tailor their campaigns and messaging to the exact needs of those groups.
And while there are numerous ways that marketers want to segment customers, we found that those who abandon shopping carts tops the list for segments that retailers want to identify and target to boost incremental revenue.
What To Do Next
How else are retailers responding to the changing retail landscape? And how do your initiatives measure up? Get answers to these questions and more in the full report: Unleashing the Power of Consumer Data in Retail.