According to Forbes, ‘The World’s Top 20 brands show that tech firms are on the rise and traditional businesses are having a hard time’ https://www.forbes.com/powerful-brands/list/#tab:rank.
If you are a retail business, either traditional bricks and mortar store, or one that only sells in the digital space, you’ll invariably be using social media and email to tempt consumers to spend again. You’ll probably be asking them for product reviews and social ‘likes’ whilst simultaneously struggling to cope with a deep understanding of the data you ultimately possess? You may not yet have identified it, but your exhaustive efforts and long days/weeks are beginning to look remarkably like the last one. If that sounds like you, don’t be surprised, judging by the numbers of attendees at a recent major event on the subject it also happens to reflect many others too.
Acquiring customer data is no longer the issue it once was, it’s using it wisely that generates daily improvements in your business cycle. You may have a perfectly good idea what led to a purchase, but you’re unlikely to understand why others didn’t follow in the same way and until you do, tomorrow will probably be very similar to today. But using tech wisely allows you to combine all your data sources so that you can better manage a method for accurately communicating with specific target groups.
As a retailer it’s easy to assume that because your competitors continually offer discounts, you should too. But in offering that extra 10% discount when times are lean will make tomorrow even harder. Assuming you have a gross margin of 20%, will mean that extra 10% discount will require you to sell twice as much for the same financial return. But even in retail consumers don’t always buy on price 100% of the time. Understanding which consumers are only ever going to buy through a special offer and which consumers won’t buy now because of comments they made in social media or which consumers have bought higher than average volumes and have become the consumers you never want to lose, needs careful identification. Understanding buyer behaviour can easily help you maximise your profit and reduce you costs (which would occur from having to sell twice as much).
If you’re a bricks and mortar store, you’ll know it’s almost impossible to track consumer purchases due to PCIDSS regulations (the Payment Card Industry Data Security Standard) that exists to protect you and your customers financial data. However, other solutions occupy the marketplace to help build an understanding of buyer habits that don’t breach these rules. If you didn’t know this was possible, or if you thought the cost of such a system was prohibitive, or if you don’t have the technological capability to scope and integrate with your current solutions, fear not help is at hand.
In the past two years, we’ve developed the briefs and led the drive for the installation of new bespoke systems that have integrated with existing software across a number of retailers. These firms range from those that employ a handful of staff within a couple of sites, to hundreds employed across retail locations nationwide.
These challenges are present across many retailers, but our experience in this sector is available to you, so that you can continue to develop your business.
The various issues around driving insight through better analysis are creating a surge in the numbers of software development companies. But how do you go about selecting such a firm to build your technology stack? How do you avoid the pitfalls? And, how do you safeguard your investment once it’s been built?
In our case, the initial stage was to understand the nuances of each client business, so that we could compile a comprehensive brief which would be used as the road map and terms of measurement. This in turn would enable us to take ownership of each of the projects as well as leading the small 2-3 man working parties. Additionally, we learnt where risk lay, and how to avoid it the next time. We also had a strong understanding of the GDPR regulations that were due in May 2018 and this further helped drive the development of the brief for tracking and safeguarding customer data (incorporating things such as user access logs to remove one potential area from ICO penalties).
These elements and many others helped drive the development of each CDP (Customer Database Platform) that we used to consolidate the data from the various systems (transaction – purchases and refunds, product colours, sizes, allegiances to brands; stock control, email marketing, social media, events, affinity and wi-fi data) and provide a much stronger basis for analysis and increased gain.
Several of these systems are now up and running and being used to good effect. So, if you are a bricks and mortar retailer and would like to speak to me about any of the issues raised in this post, please email me, Nigel Davis.
Nigel Davis was voted ‘One of Britain’s Top 50 Small Business Advisors’ & is an MCIM Chartered Marketer.