Retail 101 for today’s basic retailer means having the tools to keep customers engaged, and making them want to come back. And, of course, it means attracting new consumers to drive new sales.
Retail 202, however, gets a little more advanced.
And in today’s high-tech, data-driven world, that means retailers have to be equipped with tactics and technologies to tap into what consumers really want out of their retail experience. But that’s easier said than done when there’s only 24 hours in a day and there’s daily, monthly, quarterly and annual sales metrics to hit. And on top of that, retailers need to keep their doors — virtual or physical — open for business whenever and however customers want.
Welcome to retail 303 — where the modern retailer must adapt in order to not be left behind. Otherwise, they may face the consequence of being left in the dust with the struggling or soon-to-be shuttered retailers who were too late to the party.
But in today’s retail ecosystem, being the nuisance at the party, showing up when you’re not invited and missing the mark on what the consumer wants out of their “party” — i.e. shopping experience — means falling short, and failing retail 303.
While innovators in the retail payments and commerce space dug into the “fifty shades of engagement,” just a few weeks back at the R2 Summit — an event focused on what it takes to reinvent retail — the conversations didn’t stop there. That’s why we caught up with Pat Dermody, President of Retale, to share why engagement matters 200 percent, as she phrased it, and how retailers should be leveraging data and technology to be less intrusive — and more engaging.
Data in retail is nothing new, Dermody explained, but how that data is being used to leverage technology in order to spur commerce is changing quicker than most retailers can keep up with.
“Retailers have always had data, brands have always had data. It’s just the level of detail and granularity and level of sophistication and ability to analyze that data and turn it into insights that has sort of mushroomed in the last five years,” Dermody said.
“We’ve always used data to try to predict trends. We’ve always used data to try to predict what merchandise will sell. But now, the amount of data — if you’re successful enough in turning it into actionable insights — makes you make smarter, more precise, data-driven decisions. I’m all for data-driven decisions in anything you do, because it should minimize the risk and should minimize the chance of error.”
[bctt tweet=”Now, the amount of data…makes you make smarter, more precise, data-driven decisions”]
But tapping into consumers’ data must be done in a tactical, thoughtful manner. Consumers are smart, and they’ll quickly catch on if a retailer is blasting them with push notifications. What consumers want is personalized engagement that’s based on measurable data that that consumer provided the retailer with. This means being ready with the right offers for the right consumers at the right time.
For example, Dermody gave the example of a retailer sending out a notification about a consumer’s favorite lotion that they’re using on a daily basis. Let’s say they are out of that lotion and they get a push notification that it’s on sale that week. That’s more likely to be an interaction that’s welcomed because it’s a product the consumer wants and will likely buy again.
That scenario isn’t intrusive, Dermody said, it’s often welcomed. However, Dermody said, “where people can cross the line is where you get into intrusiveness or areas that are not really welcomed.”
“If you cross into place where it’s unwelcome, untoward, doesn’t make your life easier, doesn’t improve your experience, then you run the risk of getting pushed into the island,” she remarked.
Retailers, of course, don’t want to end up on that island, isolating themselves from their customers. Or worse, making it harder to engage new consumers. But balancing the line between welcomed interaction and intrusive communication can be a tough act — particularly because retailers already have enough on their plate. It’s hard enough just keeping up with what the trends are and how consumers are reacting — or in some cases, creating that sea change.
Because retailers have often “been designed to meet a certain cadence of customer engagement,” creating a new mindset about how to interact with customers via devices can be a tricky concept to master. With the introduction of mobile, mainly in the last five years, everything has changed.
And it’s accelerating at a rate which calls upon retailers to change more swiftly and more frequently than ever before.
“Now, all of a sudden, the meteoric rise in engagement on a mobile device is if you weren’t preparing, and you weren’t turning that scale of retail organization around, and if you don’t have everything firing [then] now you’re behind,” Dermody said, citing the example of the expression about changing the direction of a plane while it’s in flight.
“That really doesn’t work. You really had to be working on building all of your capabilities to this point. Because the minute the customer jumps over that hurdle and engages in mobile technology, you better be ready. Otherwise 20 other people are ready before you are,” she said. “[And you] still have to run business on a daily basis while you’re building all these capabilities that are coming.”
So what’s holding retailers back? Well, this goes back to the basic steps of mastering Retail 101, 202 and 303. It’s about mastering every step along the way, which can’t be done without keeping up with the data, tactics and technology used to leverage the best knowledge on customer engagement and retention.
“I think [retailers] get it. I think sometimes the day-to-day operations of running a retail organization — just like any business — can make you lose sight of what really counts,” Dermody said, giving the example of when traditional retailers realized brick and mortar wasn’t enough. And thus, the eCommerce boom began.
But then those sites were built — by engineers, Dermody noted — which meant the site functioned, but may not have functioned in a customer-centric model. Now, retailers are having to go back, pivot and reinvent the online shopping experience in a way that’s personal, engaging and connects the consumers to a brand.
What this all comes back to is keeping customers happy, keeping them engaged and keeping them coming back. And if retailers are lucky, those consumers are doubling as brand ambassadors — particularly with the power of social media in their hands at every moment of the day.
“The more engaged a customer is, the more likely you are to retain them. And the less you are going to have to spend to either acquire a new customer, or reclaim that customer,” Dermody said. “The more you can keep engaged customers, and the more you can keep them happy, the better your business results will be, and the more brand ambassadors you will have.”
[bctt tweet=”The more engaged a customer is, the more likely you are to retain them”]
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