Competing With Digital Giants: How Brick-and-Mortar Can Fight Back With Data
We've all been there: Pajamas, too early (or late!) for stores to be open, and even if they are, the traffic and crowds may be unpleasant. Shopping via the warm, blue glow of a computer or phone just seems the easier route. After all, price matching is as simple as switching between browser tabs, and the product is likely guaranteed to arrive in two days, maybe sooner.
This is the retail reality the digital world has built. Online-only marketers and direct-to-consumer brands are defining this ecosystem, and leaning into the data-driven benefits it presents. They tell their customers, “Whatever you want, we can give it to you if you just make a few clicks.”
In this new paradigm, how can brick-and-mortar retailers compete? How can they get more customers through their doors and contend with the influx of competition ushered in by digital?
A Unique Advantage
To start, it takes maturing from multichannel to omnichannel thinking. As noted in new research from Cuebiq and Retail Ascendant, physical retailers have the opportunity to better leverage insights and data gathered in the offline world in order to compete against online leaders.
Take footfall as a prime example. In a survey conducted in June/July 2018 among retail executives, footfall measurements impacted several business decisions, including assortment and merchandising (79 percent), media and marketing decisions (71 percent), and omnichannel optimization (57 percent). In contrast, utilizing location intelligence for store-by-store metrics (29 percent), shopper marketing (21 percent), and customer conquesting (14 percent) ranked among the lowest use cases.
These results suggest that footfall remains confined as a channel-specific measure focused on the broad optimization of marketing and merchandising. But why should it be so limiting? The insights gleaned from data like footfall measurement have the potential to increase traffic to specific stores, deepen understanding of customer behavior, and enable retailers to more effectively meet consumer needs.
Growing From Traditional
Retail customers are multifaceted. Therefore, the marketing approaches to reach them need to be as well. Many recognize this but still rely on traditional ways of measuring engagement. According to our research, retailers continue to evaluate in-store traffic most frequently via people counting (53 percent) and the use of credit card or loyalty programs. The other most used methods were location analytics (33 percent), in-store sensors (33 percent) and mobile devices (27 percent).
What’s positive here is that the data suggests retailers are beginning to adopt new technologies. And even though retailers may employ some “old school” methods, they still view footfall measurement as a priority. In fact, 38 percent of those surveyed view it as a top three source of analytics, and 23 percent see it as growing in importance.
Moving Forward Fast
Building a digital foundation to compete with omnichannel leaders like Amazon.com means thinking differently. The first step for retailers is investing in better offline analytics. Analysts and data scientists have become table stakes for retailers, as they can efficiently assess offline patterns in conjunction with online efforts. Building models to understand the omnichannel impact and tradeoff will help make the company more successful.
Additionally, retailers should look to learn more from their competitors’ traffic patterns. Location analytics can enable more rigorous footfall pattern analysis, allowing them to measure where people go when they're not in-store. This competitive intel deepens the understanding of where consumers spend time and money — and makes it easier to send targeted messaging to potential customers.
Beacons can also be implemented in tandem with location data, as both give retailers greater depth of measurement and a better way to correlate visits. These technologies go beyond the limitations of today’s offline traffic measurement, providing a vast amount of data from web, mobile and other digital channels.
A New Era of Engagement
Digital isn't going away, and data will only grow and become more powerful for those able to wield it. That’s why it’s important to set standards to confront the insights age now.
Start by creating internal performance metrics within and across channels via cross-channel attribution. When measured and incentivized together, this can drive internal teams to encourage cross-channel traffic to online and offline properties. It can also ensure the heavy fixed investment in physical retail is both optimized and recognized for its contribution.
In addition, reward consumers for engaging and buying across channels. Recognizing when a loyal online shopper visits the store or a traditional brick-and-mortar customer buys online helps solidify the relationship. The insights about these omnichannel customers can help optimize expensive marketing and merchandising decisions, and allow for progressive rather than conflicting or impersonal messages and offers.
All customers make decisions based on perceived value. Therefore, if someone is in their pajamas at home adding items to their digital cart, ask why? And when the data provides the answer, be prepared to act on it.
Valentina Marastoni-Bieser is the senior vice president of marketing at leading location intelligence and measurement company Cuebiq.
Valentina Marastoni-Bieser is the Senior Vice President of Marketing at leading location intelligence and measurement company Cuebiq.
As head of Marketing, Valentina spearheads all aspects of the company’s marketing and communications. She has managed the development and expansion of the Cuebiq brand since its inception, playing an instrumental role in the growth of the brand from newcomer to leading player in the location space.
Valentina brings over 12 years of marketing and brand building experience in the martech, technology, and advertising industries. Prior to Cuebiq, she worked for leading media organizations NBC Universal and USA TODAY, focusing on integrated marketing and product marketing, leading revenue generating marketing partnerships and groundbreaking programs for advertising clients. Her career began in the tech start-up world where she found her passion for B2B marketing and brand building.
Valentina holds an MBA from Fordham’s Gabelli School of Business.