The digital age is changing the face of retail. The space race, in which retailers invested primarily in opening more square feet, is switching to investment in online and mobile assets.
Likewise, in place of mass media planning and communication there is greater focus on personalised communication targeting individuals through any channel. And use of customer data from transactions and loyalty cards has moved on to using real-time and geo-location data.
Those are drastic changes but the key goal for retailers remains the same: delivering a great customer experience, every time.
Achieving this in a multichannel environment requires retailers to follow some key steps:
1. Connect the dots
Understanding customer behaviour has never been more important and to do that it is essential to connect different data sources – what people are buying, browsing and saying, and which channels they are engaging with.
Gaining insight and connecting these separate data points enables retailers to understand the interplay of their different commercial and media channels and act accordingly. For instance, one of our retail partners was able to understand how its website was being used to do research before purchasing in-store, while another was able to see how its Click & Collect service led to additional in-store visits in certain categories.
Customers have very many choices, influences and new paths to purchase these days, which means the need to influence them before they shop, at the “discovery stage”, is very important.
Helping customers before they shop with planning tools such as menu builders, auto-stocking reminders, ideas and inspiration is highly effective and makes it more likely to prompt a visit.
3. Customers, not channels
As new formats and channels emerge, creating dedicated teams for these areas might seem pragmatic. While the focus this offers is indeed important, it’s also critical to have a holistic customer view on the financials.
Click & Collect and home delivery, for instance, are channels that might not appear particularly profitable when viewed in isolation.
However, with many retail partners, we have been able to identify how the multichannel shopper is often three to four times more valuable than a single-channel shopper, and shopping across channels drives incremental sales.
For example, with one retailer that was worried about cannibalising its own stores’ sales by going online, we could prove that, in fact, two thirds of the online sales were completely incremental and a driver of growth.
Taking a customer view, rather than only a channel view, is critical to make the right decisions on new services and areas of investment.
4. Seamless experience
Today’s customers don’t stick to any one channel in their daily lives but will tend to use different channels and formats to meet different needs.
They expect the same brand experience to be seamless, so it’s critical to iron out any friction that gets in the way of the customer experience.
One retail partner we worked with identified such a friction point with its returns policy, which didn’t allow customers to take back items they had bought online to the local store.