Over the past 20 years, new technologies have helped shift how retailers market to their customers. Before the Internet, segmenting audiences and marketing campaigns was a fairly unrefined practice, with marketers only able to make general inferences about what shows young adults watched or what magazines women read.
However, as the Internet, and more specifically Google, grew, this opened the door to whole new ways to segment and reach specific audiences. Not only could marketers place their adds for socks on a site that sells shoes, but they could group their ads based on what potential customers were looking for at that exact moment. The advent of Google Adwords is what launched Google into the powerhouse they are today and is what turned interactive advertising into a nearly $35 billion dollar and growing industry, according to Forrester.
Even with this newfound ability to gain immediate insights into what customers are thinking, marketers are still limited by the lack of context. These campaigns and loyalty initiatives reach customers inside a vacuum as they are only based on a small piece of the puzzle, yet assume the full picture.
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With marketing departments split up by traditional versus digital, in-store data stored separately from online, and IT departments with more data access than the marketers, it has proven difficult to create one consolidated view of the customer that can be used to further advance communications. New innovations are aiming to improve upon this though.
The Goal: Consolidate Big Data
Third-party companies have started to emerge that specialize in consolidating big data, analyzing it and creating actionable insights and practices to help improve upon this marketing roadblock. What these companies have discovered is that only so much context can be added if you focus solely on what a retailer has access to. Retail marketers are able to see what their current customers are doing while shopping with them, but they have no insight into their other shopping habits and loyalty such as where else they shop or how they spend the rest of their time.
These solution providers are aiming to fix this issue by taking a step back and analyzing purchase behavior as a whole. By working with financial institutions, they analyze information such as where customers shop, how much they spend and what they buy. This gives banks and retailers unprecedented insight into their customer’s purchasing habits that allows them to easily segment users and tailor effective rewards and offers that will actually drive desired behaviors.
This level of context ensures that marketing dollars used are being used efficiently, as retailers can precisely define who will see what value of offer, and makes calculating the ROI for these dollars simpler than ever as they can also see how the customer’s purchasing behavior changes over time.
When it comes to marketing and loyalty programs, 58% of customers want more compelling personal benefits and services and 1 in 4 have received a promotion or reward for something they would never buy, as reported by whattheythink.com. Customers are craving a new level of personalization that can benefit them and marketers need to stop wasting marketing dollars on rewards and services that customers don’t want.
By embracing these new technologies, retailers can create a win-win solution for both them and the customer. Retailers have the ability to easily build context into their loyalty and marketing campaigns while customers reap the benefits of rewards and offers they are guaranteed to love.
Jen Millard is the Chief Revenue Officer for Truaxis. She is recognized industry expert with 20 years of experience as a retail operations executive. She specializes in consumer and channel segmentation, and the convergence of technology and retail innovation that improves retail operations and the customer experience.
