Every year around this time I face a challenge that I’m sure is familiar to many of us: buying the perfect gift for my wife’s birthday. This year, however, my shopping journey went a little differently than in years past. Two weeks prior to her birthday, one of my favorite online shopping sites sent me an email reminding me of the impending date. I was able to click through the email and immediately order the espresso machine I’d added to a wish list months ago. Upon ordering the machine, the site suggested a cool pair of espresso coffee cups with matching dessert plates. After completing my transaction, I received a personalized coupon for a future purchase.
Can you imagine this series of events taking place even a few years ago?
The Personalization of the Retail Industry
A recent article from McKinsey identified five things consumers say they value when it comes to personalized interactions with stores and brands:
- Relevant recommendations they might not have thought of on their own
- Communication with a brand while they’re in “shopping mode”
- Reminders of things they might not be keeping track of
- Recognition, no matter where they are in their journey
- Meaningful interactions
My online shopping experience checked the box on #3 (reminding me about the birthday), #1 (offering a relevant option to pair with the espresso machine) and #5 (by offering me a coupon for my return visit).
This new approach, in which every aspect of the shopping experience becomes more personalized, is positive for both consumers and retailers:
- According to Accenture, 75% of consumers are more likely to buy from retailers who offer personalized experiences.
- Personalization drives revenue growth 5-15% .
- Personalization can increase the efficiency of marketing spend by 10-30%.
- Personalization drives loyalty, which increases customer retention … and when your consumers start having better experiences with your brand, they’re more likely to become brand ambassadors.
- Consumers benefit from tools that save them time and money, and algorithms that help uncover products of interest to them.
Consumers do not think – or care – about (mostly) retailer-owned channels and touchpoints. They simply view the brand holistically and demand a consistent and seamless experience across all touchpoints whenever, wherever, and with whomever they want. Retailers must change their mindsets accordingly and make the organizational shift toward a more open, flexible, digitalized era where everything is centered around the consumer.
Consumer Engagement is Key
As my colleague Lars Wiesner wrote in a previous post, in a connected commerce environment, there is one tool that every retailer must have: a software solution that creates seamless, personal connections across the digital and physical channels of today and tomorrow.
Our new software suite, Vynamic™, features the industry’s most complete, end-to-end solution set for the future of retail. A key element of this is Vynamic Engage, a cutting-edge solution that revolutionizes how retailers can drive consumer engagement, enabling a 360-degree view of customer behavior and enhancing their shopping experience at every touchpoint of the journey – such as targeted promotions and real-time campaigns across all channels. This cloud-based solution supports a wide variety of consumer journeys, enabling retailers to capture relevant consumer data and store it in a single place, such as a CRM system, and complement that information with transactional, behavioral and sociographic data as well. It can even be enriched with third-party data sources (such as buyer characteristics based on zip code) in order to provide truly holistic consumer profiles driving loyalty and increasing overall spending.
Importantly, the take-away message in Wiesner’s post is that there is no one-size-fits-all loyalty program that will work for every retailer. It’s all about delivering personalized experiences. The software and the approach must be flexible and customized – baby boomers have very different needs and priorities from millennials, for example. Retailers must be able to pinpoint and directly address their specific target groups, and offer them meaningful incentives. And, as noted in the McKinsey report, those communications should occur when the consumer wants them to occur.
Taking the right steps to offer a personalized experience leads to what we like to call “a store for one,” in which every single consumer feels like the shopping journey was tailored just for them.
Personalization and “A Store for One”
To accommodate the future of retail journeys, we provide solutions designed to extend beyond omnichannel offerings and enable a “store for one” – a connected-commerce approach that is completely centered around the consumer. Obtaining a holistic view of your consumer data and being able to utilize this data to deliver personalized experiences is the crux of the “store for one,” and there are a number of components to the approach that must be considered:
- Capture all relevant data about your consumer.
- Use the right tools to help you recognize consumers based on uniquely identifiable data (e.g. using facial recognition).
- Process the data appropriately to understand who your consumer is, and what they’re looking for, in the moment.
- Interact in real time, while your consumer is in shopping mode.
- Offer the right incentives to attract individual consumers.
- Quickly analyze their behavior to determine a real-time course of action.
- Optimize each engagement through smart feedback loops that help further enrich the consumer’s profile.
This approach is just as relevant for brick-and-mortar retailers as it is for online shopping experiences. A leading cosmetics retailer, for example, incorporated personalization into the store experience with fragrance and makeup kiosks that help consumers discover new products that meet their unique preferences. They’ve also implemented beacons to recognize consumers who use their app, and offer a monthly subscription box that is mailed to consumers’ homes, and includes information about in-store events. The company has thoughtfully intertwined physical and digital channels to provide a seamless shopping experience.
Your brand can offer equally innovative physical-to-digital experiences – and the right technology partner can help you future-proof your organization for the emerging needs and patterns of your consumers. In my next post, I’ll dive into our Vynamic Mobile Shopper solution.