No industry sector has experienced a year quite like 2020. For retailers, the pandemic caused massive upheaval to in-store shopping, supply chains, marketing budgets, and more. Retailers that relied heavily on brick-and-mortar sales were forced into e-commerce seemingly overnight. But the truth is the pandemic arrived at a time when retailers were already grappling with a host of other challenges disrupting the industry and accelerating the need for business transformation. The growing influence of Amazon.com, increasing consumer privacy regulations and resulting third-party cookie deprecation, and increasingly complex, fast-moving consumer journeys were all shaking things up long before 2020. However, the sudden impact of the pandemic, combined with these existing factors, shined a spotlight on the need for business agility and resiliency in the wake of disruption.
Some retailers have been more successful in adjusting to these challenges than others. Those that were able to adapt quickly share one critical commonality: they prioritize the collection and use of first-party customer data as a competitive asset.
The First-Party Data Imperative
Collecting and unifying first-party data yields one of the most important assets a retailer can have: a single customer view. But it doesn’t stop there. To maximize first-party data as a strategic and competitive asset, it must also be accessible to the functions within the company that are responsible for driving growth, such as marketing, e-commerce, and analytics.
By pairing unique identifying information with a comprehensive, real-time record of each customer’s individual attributes (e.g., behaviors, interests, preferences, customer scores, consent status, etc.) and making it accessible to growth-focused teams, a single customer view enables retailers to deliver bespoke experiences across all touchpoints that no competitor can replicate. It also helps retailers streamline their business operations — making everything from multidimensional segmentation to customer modeling and analytics to optimizing experiences across customer lifecycle stages more efficient and cost effective.
The good news is that most retailers are awash in first-party data collected from online and offline sources, including websites, mobile applications, e-commerce portals, point-of-sale systems, CRM systems, and more. The problem is the data lives in siloed systems that each have their own unique way of storing data and recognizing customers. Some have invested time and money into a centralized data solution, but it doesn’t enable business users to actually do something with the data. They still have to wait on overburdened IT teams or costly external agencies to query and normalize the data, which is often days or weeks old by the time it’s ready for use. As a consequence, departments across the organization are left to make critical decisions based on a partial view of the customer, creating disjointed experiences that can have a damaging impact on brands.
A Customer-Led Viewpoint
Fortunately, there are technologies available, like a customer data platform (CDP), that can help retailers liberate their first-party data, making it accessible to business users and enabling agility.
A CDP not only unifies first-party data from disparate systems at an individual level, but also delivers that unified profile data back to cross-functional teams and their tools in a format they can use when and where they need it. For instance, retailers can use what they know about their customers and prospects to improve the effectiveness of the evergreen and time-boxed programs they already run today, including seasonal offers, holiday campaigns, loyalty programs, and more, as well as power larger strategic initiatives that transform the core of their relationships with customers, such as customer lifecycle marketing programs, digital products and experience offerings, audience data monetization, and more. Moreover, by having unified profile data in such close proximity to their activation mechanisms, retailers can react more nimbly to new challenges and opportunities.
Take VF Corporation, parent company to brands like Timberland, Vans, The North Face, and SmartWool. Leveraging a CDP, VF Corporation was able to gain a "corporate-level" view of its customer data and provide each of its brands access to a unified customer profile database that also supported their activation use cases. The company now builds dynamic, multidimensional segments using a combination of 200-plus attributes, and sends them to their activation channels instantaneously — without the delay or added cost of external database management. With customer data no longer out of reach of the brand teams, the company can dramatically improve marketing tactics, quickly test and iterate new campaign concepts to bolster sales and loyalty, and create segments based on customer lifetime value and other scoring to better understand and engage its customers.
Michele Szabocsik is the vice president of marketing for BlueConic, a customer data platform that liberates first-party data so you can orchestrate individualized experiences in every customer lifecycle stage.