August 24, 2017

Retail Rescue: Can Personalized Marketing Attract Customers

Trading networks suffer significant losses – you have to pay for rent, pay salaries to employees, etc., but there is no profit or it is minimal. What is the solution?

Today, in difficult conditions for the economy, American retailers face the challenge of not just increasing profits and retaining the client, but at least retaining their current positions in the market. The result of this we see every day – our shopping and entertainment centers (TRC) today are more and more like galleries, where buyers just look at the goods, but do not buy anything, and vacant premises for rent no one surprises. Consequently, trade networks suffer significant losses – you need to pay for rent, pay salaries to employees, etc., but there is no profit or it is minimal. What is the solution?

In my opinion, the management of the SEC should carefully look at modern analytical technologies, which have long and successfully worked in the developed countries of the world. It is common knowledge that traditional marketing techniques in retailing today are already ineffective, and new problems arise for marketers, which are not easy to solve by customary methods. Especially in conditions of budget deficit. In my opinion, American retailers today need to use the strategy of “going from the client”, and not “from the product.” Trade networks in the United States have long been implementing various loyalty programs to increase marketing efficiency – buyers have discount or bonus cards, participate in prizes of valuable prizes, promotions, etc. However, in my opinion, American retailers do not enjoy all the benefits of their customer data. For example, can your trading network become a customer service center 24/7, an online store and a showroom? If you do not understand what your buyer wants in a particular period of time, it is unlikely that he will give you his money.

To understand the needs of your customers, you need to see the current picture in its entirety, understand the needs of your target audience, track opinions about your product and the tone of customer statements, analyze complaints and, most importantly, do it all in a complex, rather than the disparate efforts of different departments. To the aid come modern analytical tools, allowing analyzing information about the consumer and providing services at a high level.

Therefore, using in-depth analytics, the SEC can increase the time of a particular customer’s stay in a shopping center. This will benefit both stores located in it, and the shopping center itself, which can create additional income by managing such a system of targeted marketing.

Here is an illustrative example. I came to the SEC for a washer for the windows of my car. With the help of geolocation tools, I can immediately be identified by the ID of my bonus card or the mobile application of the SEC in my smartphone – the whole history of my purchases, my preferences, my usual budget, in other words, the SEC gets my detailed client profile, in which It is evident that I am interested in, for example, also children’s goods. And if in the shops of children’s clothes today sales, then I would also be interested in going there, although I was not going to spend it for this time. Therefore, the program will notify me of this by SMS, as soon as I enter the shopping center. In addition, this is not fiction, similar technologies are successfully working with retailers around the world.

Today, modern analytical solutions allow you to create the most holistic view of the customer, creating the so-called “360 degree view”. Using a wide range of client analytics tools, you can gain a deeper understanding of the client, the level of his social capital, predictable behavior and profitability. This facilitates the creation of more targeted marketing campaigns for cross-selling and additional sales, which include optimal offers for each client segment, using the right communication channels.

I will give an example from practice. During the economic downturn, consumers refuse first of all from souvenirs and delicacies. For the American company Harry & David (sweets, edible souvenirs) during the 2008 crisis, sales and profits fell significantly, and in 2011, even the bankruptcy procedure was initiated.

Thanks to analytical tools, the company knows who its customers are, how and when they would like to receive offers, and who of them is ready to buy more. Over the past three years, the effectiveness of customer retention has increased by 14%, sales per customer grew by 7%. The growth of the share of loyal and valuable buyers amounted to more than 10%. Thanks to segmentation, modeling and comparative analysis of transactional and demographic data, Harry & David today identifies customers with maximum potential value. The company annually conducts 50 advertising actions in printed publications and 500 – by e-mail.

Optimization of marketing campaigns with the help of in-depth analytics tools is what allows to maximize the economic return from them. First, due to the optimal distribution of proposals for clients, taking into account the available channels and resources, budget constraints and rules of contact policy.

And, which is also important, the use of in-depth analytics not only increases the inflow of customers to the SEC, but also gives retailers a clear understanding of what discounts work, what offers, when, for whom and why they are relevant, etc. The introduction of client analytics will allow our mall to build more accurate forecasts, on the basis of which they will be able to optimize their trading assortment and improve supply logistics, which is also relevant today.

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