As the amount of readily-available retail data continues to multiply, capturing useful and accurate information can be overwhelming for Chief Marketing Officers. According to a recent IBM study of data collection, 71% of retail CMOs feel underprepared to manage today’s explosion of data. At the same time, according to the study, retailers are excited over the information available about customers and the various ways to communicate with them.
Geoffrey Colvin, Editor-at-Large at Fortune Magazine, moderated a panel discussion about data capture and insight during the National Retail Federation 101st Annual Convention & EXPO, Jan. 15-18 at the Jacob K. Javits Center. The session, titled “Critical Development in Retail Marketing: Understanding Consumers, Building Brands,” focused on the validity of data retailers receive from consumers, and shared ways to create actionable insights from customer information.
Members of the panel asserted that as retailers continue to face the challenges of finding best practices for customer engagement, data analysis has proven to be one of the most important factors in doing so.
Panelists Alexis Maybank, Founder and Chief Marketing Officer of Gilt Groupe; Billy May, VP of e-Commerce and Cross-Channel Marketing at Abercombie & Fitch; David Ferrucci, Principle Investigator for IBM Watson Technologies; and Jon Iwata, SVP of Marketing and Communications for IBM, emphasized the importance of acknowledging online data via cross-channel interactions to understand consumers. They noted that the era of Big Data has changed the way retailers communicate with customers, and said that although many retailers continue to use historical data, real-time predictive data offers access to current transactions for better data analysis.
Maybank shared the significance of understanding consumers via online interactions and reacting based on registered information. With more than 5 million patrons, the Gilt Groupe e-Commerce web site acquires customers through a registration process completed directly or through a friend. “Whenever customers visit Gilt Groupe, we know exactly who they are and what they’re doing each time they sign in and during each engagement session,” she said.
Consumers are spending a majority of their shopping time online; however brick-and-mortar stores continue to prevail in the retail industry, according to panelists. The challenge is to make the information relevant to shoppers whether in the physical store or through online interactions. May noted that Abercombie & Fitch’s customer engagement strategy focuses on value exchange: “Retailers must put emphasis on enticing strategies that provide a value experience whenever the customer interacts with the brand or signs up for membership.”
Ferrucci discussed the importance of customer expectations and emphasized how data is the “new microscope,” a tool that deepens the retailer’s relationship with consumers. “Customer have expectations when dealing with a brand, and data analysis helps retailers meet those expectations,” said Ferrucci. “Retailers must have a clear view around their brands and their audience.”
A majority of consumers will share personal information, such as preferred media sources, name, address and lifestyle, in exchange for a more relevant and personalized experience. “About 28,000 consumers [share personal information] based on buying patterns,” noted Iwata. “Surprisingly they share location ― where they are moment to moment ― and want favorite retailers to send them more information, as long as it’s relevant to them.”