Marketing is undergoing an explosive shift. We are switching our communications lens from “transactional” to “interactional” as we strive to build intimate relationships with our customers. This pursuit of a deeper connection with customers (and audiences that look like customers) is empowering the consumer sector with context-aware and location-based demands. And the eruption of interactive devices and social media is unleashing unprecedented volumes of interaction-level data.
In a recent survey by Retail Systems Research…
- 55% of retailers said that one of the primary challenges in providing consistent cross-channel shopping experiences is that they still don’t have a single view of the customer across all interaction points.
- 30% say they have budgeted for an investment in a platform that will provide this interactive view; and another
- 24% say they’re in the planning stages for integration of such a platform.
Major retailers recognize how important customer intelligence is, and the advantages afforded by these insights. A McKinsey study released in May 2011 found that by using deeper customer intelligence fueled by the incorporation of Big Data, retailers stood to increase their operating margins by as much as 60%. Forward-thinking retailers have already been investing heavily in the platforms and analytics needed to create this enhanced customer view, combining transactions with interactions.
“Big Data” has been lauded as a basis for understanding what motivates customers. Embedded in the data are the circumstantial opinions and empirical preferences of customers, revealing critical information in a way that transactional data views alone never could have exposed. This provides marketers with the insight necessary to propagate a unique individual, and perpetuate iterative conversation as opposed to simple, one-off observation and promotion. Access to Big Data provides a much deeper understanding of the customers’ true feelings and motivations, and is thus foundational insight needed to building an enduring relationship.
As retail marketers seek to overcome the limitations of relying on daily observations to gain customer intelligence, they are rapidly mobilizing to ingest and operationalize the Big Data promise of customer participation and engagement. They are shifting their business, realizing it’s no longer only about selecting the most valuable customers and promoting to them, it is about understanding how and why the customer interacts with the brand. Big Data allows us to understand a consumer’s distinct preferences; media, cadence, and intimacy of contact. With this understanding, marketers can personalize and maintain a consistent “listen and respond” dialogue, fostering trust and loyalty with their brand.
Individually personalized marketing, operationalized through the ability to sustain a unique customer dialogue, is proving to be a powerful loyalty tool. This customer-centric strategy drives surges in order size, increased shopping visits, and improved loyalty as measured through retention over time. “Over time” being the operative phrase. The sooner brands become entrenched in a customer-centric strategy through the implementation of Big Data solutions, the sooner the needle will begin to move in the right direction.