Author: Sarah Jarvis, Communications and Propositions Director of Eagle Eye
In today’s retail landscape, data reigns supreme. It’s not just about what you sell but who you sell it to. One of the most critical lessons I’ve learned throughout my journey in retail marketing is that you manage what you measure. In this blog post, we’re going to introduce the transformative power of data in retail, how it can be used to shape the shopping experience, and why it’s essential for every forward-thinking retailer to embrace a customer-centric approach across every aspect of their business.
A New Lens: The Customer’s Perspective
It’s time for retailers to shift their viewpoint. Step into the shoes of your customers and see your business through their eyes. Too often, executives project their experiences onto their customers. The key here is to generate data-driven insights rather than using gut feel to enable you to truly understand your customers’ behaviours and motivations, and to use that understanding to enhance their future experiences with you.
Linking Customer Insight to Sales
Becoming a customer-centric business starts with connecting purchases to individual customers, typically via an engaging, omnichannel loyalty program. To ensure that you capture as much data as possible, your program should incentivise customers to identify themselves with every transaction, typically offering the ability to earn currency (points, cashback) or instant discounts or perks if they do so.
Once you have a solid foundation of customer data, the first step we recommend is using it to identify your best customers, understand their preferences, and tailor your offerings accordingly. Measure the impact, optimise your strategy based on your learnings and go again, including the next cohort of customers too. Rinse and repeat.
The Power of Data in Decision Making
Using customer data to inform your decision making across every aspect of your business from pricing to promotions to ranging and more is critical to success. Without it you are operating in the dark. Before you take any decisions remember to ask yourself – is this absolutely the right thing to do for our customers? And make sure you have the data to prove it.
The examples below illustrate how customer data can benefit decision making across various areas of a retail business:
Data-Based Ranging: Customer data is a treasure trove for retailers looking to optimize their product range. Let’s take sparkling wine as an example. Within this category, most customers flock to promoted items, showing little brand loyalty. But imagine if there was an exception to that rule, a specific product within the category which was bought exclusively by the top 5% of your customers? Working using just sales data alone, you make take a decision to de-list that product based on the fact that it sells in very low volumes, and you imagine that the category as a whole will continue to perform well without it based on your successful promotional calendar. And how wrong you could be. Removing this product from the range could put you at risk by alienating some of your most valuable customers, and by ignoring them in this category puts you at significant risk of losing them in others, potentially forcing them to move their entire basket to your competitors. Data empowers retailers to protect and tailor their product range based on customer insights, delivering the potential to provide a better shopping experience for all.
Data-Based Pricing and Promotions: Traditional pricing initiatives focus on staple products – key value items which affect the vast majority of customers. But what if you could understand and target the most price-conscious shoppers? By investing in price cuts on products frequently purchased by your most budget-conscious buyers, you can create a disproportionately positive impact for them, engendering their loyalty. Personalized pricing initiatives are already being adopted by leading retailer globally, with these businesses using advanced analytics and AI to determine the optimal price discount on specific products for specific customers, ensuring that they maximise the bang for their buck when it comes to promotional spend and performance.
Data-Centric Supplier Relationships: Many retailers are already tapping into the potential of customer data to strengthen relationships with their suppliers. One way to do this is by sharing customer data with suppliers, enabling them to understand how the retailers’ customers are shopping within their categories in order that they can work more closely together, aligning their objectives based on how best to serve their shared customers.
In addition to this, retailers can also provide their suppliers with the ability to run personalized offers to specific customers, allowing them to execute marketing campaigns based on the insights they have derived from the loyalty data that they have been given access to.
This approach leads to a win-win-win scenario: suppliers gain deep customer insights and the ability to action them in a meaningful way, retailers unlock a new, profitable revenue stream and build closer relationships with their suppliers, and customers enjoy a better, more personalized shopping experience.
I hope we have illustrated here that customer data is the critical currency in the retail world. Retailers who harness the power of data-driven strategies are better equipped to meet the diverse needs of their customers. This not only provides the ability to boost sales but also enhances the overall shopping experience, engendering customer loyalty. In the age of data, retailers that truly understand their customers will thrive in what is a fiercely competitive market.
About the Author
Sarah Jarvis is the Communications and Propositions Director of Eagle Eye. With over15 years of experience as a Retail Marketing Leader in the loyalty industry, she hasworked with some of the world’s largest retailers and FMCG brands to help them drive profitable growth by prioritising the customer in their decision-making processes. Herexpertise spans loyalty program design, CRM, personalisation, data analytics, data commercialisation, and the technical implementation of initiatives that bring retailers and brands closer to their customers. Her know-how of what drives loyalty and effective personalisation can be seen in the2nd edition of Omnichannel Retail: How to Build Winning Stores in a Digital World, which she co-authored with Tim Mason in 2023.
About Eagle Eye
Eagle Eye is a leading SaaS technology company enabling retail, travel and hospitality brands to earn the loyalty of their end customers by powering their real-time, omnichannel and personalised consumer marketing activities.
Eagle Eye AIR is a cloud-based platform that provides the most flexible and scalable loyalty and promotions capability in the world. More than 750 million personalised offers are executed via the platform every week, and it currently hosts over 200 million individual loyalty members for businesses worldwide. We are trusted to deliver a secure service at hundreds of thousands of physical POS destinations worldwide, enabling the real-time issuance and redemption of promotional coupons, loyalty offers, gift cards, subscription benefits and more.
The Eagle Eye AIR platform is currently powering loyalty and customer engagement solutions for enterprise businesses all over the world, including Asda, Tesco, Morrisons, Waitrose and John Lewis & Partners, JD Sports, Pret a Manger, Loblaws, Southeastern Grocers, Giant Eagle and the Woolworths Group.
In January 2023, the Group acquired France-based Untie Nots, an AI-powered personalised promotions business, adding Carrefour, E. Leclerc, Auchan and other leading brands to its European customer base.
Visit www.eagleeye.comfor more information.
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