As a savvy retailer you have mastered your multi-channel strategy, making your mobile apps more customer-friendly and creating an in-store and online experience that accommodates how individual consumers shop. But how can you move further ahead in this new digital era?
As both digital & mobile channels have transformed the customer experience, how we engage is key. For retailers the goal isn’t just to optimize channels, it is all about the customer experience they receive regardless of the channel. Omni-channel is about putting the customer at the center of each interaction, instead of the retailer, whether it be in-store, online, on mobile, on an app or on social media. So the question to ask is; are you creating a true Omni-channel strategy or are you just working across multiple channels?
So how do you accomplish this? The answer is Big Data. Many retailers may ask, “How can we use Big Data to accomplish X, Y, or Z?” when the correct question should be, “What am I looking to achieve by bringing together data from multiple sources and channels?” The customer should always be at the center of every question when developing a strategy. Therefore, it is first essential to understand them at their core.
However, despite the obvious benefits, most retailers are still daunted by the complexity and scale of Big Data. One major challenge is how to align Big Data with the right use case. So below, we’ve put together a few use cases on Understanding your Customers, Driving Customer Loyalty with Personalized Offers, and Creating an Omni-Channel Experience.
In order to design a customer-centric approach, you need to understand your customers, how they shop, when and where they want to be engaged, and what their greatest needs and challenges are. When one major women’s brand found from their customer research that shipping charges were the prime reason for not purchasing, they planned on leveraging Big Data Analytics to uncover insights and opportunities to optimize their shipping promotions and boost customer satisfaction. To get a better understanding of the company’s customers we created an integrated view of their shopping behavior across Omni-channel platforms (in-store, online, mobile) and built customer segments based on key dimensions like sales volume and frequency of purchase over a period, customer loyalty, pricing/promotions and product value groups. Next we, worked with the retailer, establishing a “shipping sensitivity score” for each customer based on past purchase behavior and promotions to understand their willingness to pay. For each customer segment, an optimal shipping promotion threshold against constraints such as minimum order size, price sensitivity and shipping margins was identified.
With proposed shipping promotion to all price sensitive customers, net revenue increased by 10% by having the customers’ increase their basket size to recommended ‘Minimum Order Value’ and savings of up to 5% revenue was achieved by not providing shipping offers to non-price sensitive customers. The result: An overall estimated increase of 15% on order value. This same concept can very well go beyond just shipping offers.
Driving Customer Loyalty using Personalized Offers
Faced with customer attrition and same store sales decline for some of its key markets, a women’s retailer employed our services to identify the drivers behind the attrition as well as to understand customer loyalty and price sensitivity for more efficient customer coupon allocation.
We analyzed 4 years of transaction, customer and demographics data to build powerful loyalty, pricing and coupon segmentation. We designed targeted personalized offers for each loyalty and pricing segment and implemented a targeting and campaign measurement platform to run multi-channel marketing for loyal customers.
The results showed that:
- 15% of brand loyals accounted for 50% of revenues
- Each premium loyal shopper was equal to 9 uncommitted shoppers in terms of sales/transactions, and
- Only 39% of premium shoppers remained longer than a year
By using this new found information, the retailer saw a 5% upward loyalty migration resulting in an 11% sales uplift.
Creating an Omni-Channel Experience
Aerosoles, a leading footwear retailer and manufacturer, was looking to enhance its website, the company turned to us to architect, design, develop, test and deploy an advanced, feature-rich, secure ecommerce website with Responsive Web Design (RWD) for mobile optimization. The mobile optimized ecommerce website and call center got fully integrated with DMI’s Order Management System (OMS), which synchs with store and warehouse locations for fulfillment.
The retailer wanted to optimize its customers’ shopping experience not only online but through all sales channels. To accomplish this, the team developed an omni-channel commerce and retail data integration strategy for delivering a unified and seamless experience for customer interactions independent of the shopping channel including online, mobile, call center or in-store. To learn more about this initiative please click here.
To hear more about how to implement an omni-channel experience using big data in your business, stop by our booth at NRF – #2346 or contact us. Together we will create the right solution to take your omni-channel strategy to the next level.