One could argue that few, if any industries have been impacted more by the pandemic, and now by inflation, more than retail. The pandemic not only dramatically altered the way consumers shop, it altered the way retailers operate. Now, inflation is adding yet another wrinkle both in terms of costs to the consumer as well as suppliers. It is now more crucial than ever for retailers to rethink the way they are looking at user experiences and customer journey mapping in order to drive personalization at scale without breaking the bank.
Consider that last year, retail ecommerce sales amounted to nearly $4.9 trillion, and it doesn’t stop there. Ecommerce sales are expected to grow by 50% over the next four years, reaching $7.4 trillion by 2025. At the same time, this rapid ecommerce growth has seen its fair share of issues, such as website crashes, customer support issues, supply chain disruptions and dips in customer loyalty due to a lack of personalization.
Yet while there have been mishaps, the emphasis on ecommerce does present retailers with a unique opportunity to reshape their operations and infrastructure to capitalize on the digital-first movement, and it all starts with first-party data.
What is First-Party Data and How Do I Get It?
Any retailer will tell you that in order to build comprehensive and personalized digital experiences for their customers, they need data. Traditionally, retailers have turned to third-party data to fill this void. However, third-party data is expensive, inaccurate and eventually will be a thing of the past.
Advertisement
Instead, companies should be looking at first-party data, data that comes directly from their customers and is securely extracted from the contents of communications channels such as email, social media, app usage, website traffic and more. There is a treasure trove of data living in customers’ communication channels that is just waiting to be accessed and put to work.
Accessing this data can be challenging and time-consuming, so when possible it is critical to leverage tools such as APIs for quick access and integration, customer data platforms (CDP) and CRMs to makes sense of the data and unify it in one place, and proper security and regulatory certifications, systems and partners in place to ensure data is being protected both in transit and at rest.
How Can I Leverage First-Party Data?
First-party data gives you a direct look into how your customers are holistically interacting with your brand. This includes web and app usage, purchases and receipts, customer support issues and more. First-party data is unified data and it arms retailers with a better understanding of what makes their customers tick, and ultimately what they are purchasing and why.
With first-party data, retailers have unified customer information at their fingertips in order to:
- Better understand customers’ buying behaviors and drive better and more personalized customer experiences.
- Optimize ad targeting and messaging with actual in-store and online sales data, and measure effectiveness at multiple touch points along the customer journey.
- Increase engagement and customer satisfaction with real-time delivery notifications.
- Access calendars and harness modern scheduling capabilities to coordinate curbside pickups, support inquiries and deliveries.
Accessing, structuring and putting first-party data to work creates the unified digital experience that customers today crave. The transition away from third-party data will obviously present challenges, but leveraging first-party data will not only help retailers meet this transition head-on, it will also empower them to capitalize on the future cookie-less world.
As Co-founder and CEO of Nylas, Gleb Polyakov is focused on empowering developers and their organizations to think big, innovate and build a better future through unlocking the true power of their communications data. With an emphasis on accelerating corporate growth and nurturing company culture, Polyakov has been recognized by Comparably as one of the Top 50 CEOs in North America and led Nylas to its ranking on the Inc. 5000 list of fastest-growing private companies.
