Callcredit Blog

What’s in store for multi-channel retailers?

Digital Services

A few months ago, I stopped using all of my loyalty cards but carried on visiting the stores to see what would happen.  The result?  No change – I still receive weekly and in some cases daily emails from a wide array of retailers.  Most of the emails are promoting generic offers, with little or nothing to do with the data I know they did or should have had access to.  Not one of them reacted to the stoppage in the email communications, eg ‘why have you left us’ or ‘lost your card’?  No incentives to ‘come back’ either.  A quick total of the spend associated with these now ‘unidentified’ tractions comes to about a thousand pounds over a three month period.

These schemes are of course about information exchange as much as engendering loyally, especially when it comes to having visibility of all purchases especially in store.  Whilst my little exercise does not represent a census of all UK retailers, it certainly does point a worrying finger to the massive investments retailers have been making on infrastructure, data, training, content, etc.

Without a doubt, many UK retailers are onto this.  Quite a few state that one of their top priorities is the need to keep building out multi-channel operational capabilities (such as reserve and collect) followed by the need to individualise and personalise marketing to drive revenues and a differentiated customer experience.  A few also openly recognise the pivotal role of data analytics in creating sustainable competitive advantage against their high street rivals as well as comparison sites and other online players.

Yet another record for online internet shopping will be reached this year – one source puts it at £17.4 billion, an annual increase of 19.5%.  But this only accounts for about a quarter of all retail spend.

This still leaves stores with the lion’s share of revenue and also costs and some are adapting traditional retail formats to support a multi-channel proposition.  As part of this, some retailers are also seeking to close the customer identification loop by installing free to use Wi-Fi for customers.

Ineffective marketing programmes lead to loss of market share, customer loyalty and a reduction in transaction value.  The weather can be blamed for many things, but lack of customer understanding (eg by not predicting and understanding customer preferences accurately) is often the root cause of poor performance.

So what’s to be done?  There’s nothing new about customer lifecycle marketing but in many cases it’s a matter of defining rules and putting them into practice so that if a change in behaviour is detected (positive or negative) then an appropriate response is generated.  Other areas to consider include:

  • Having a fit for purpose CRM/single view of customer that can be used for marketing purposes
  • Creation of a customer lifecycle programme which picks up on changes to customer behaviours whether in store or online
  • Using the CRM data in combination with enhancement data to help predict customer preferences and drive a programme of engaging communications
  • Using the data to across email, social, display and PPC domains
  • Testing and learning to develop the rules and improve performance over time

If you would like to find out more about to take your multi-channel model forward into 2015, I am happy to discuss – just drop me a line paul.kennedy@callcreditgroup.com or have a look at our retail page.

Author: Paul Kennedy

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