To Capitalize on Customer Engagement, Retailers Need to Dive Deeper Into Customer Insights
The digital landscape is evolving at lightning speed. Retailers are overwhelmed due to the multifaceted nature of their work that requires them to manage multiple digital channels, work with different tools, analyze data, and make faster decisions. The increasing number of Martech solutions makes it even more complex — 9,932 in 2022 compared with 7,040 in 2019.
The plus side is that marketers can easily access various marketing tools and collect large volumes of data. However, understanding this data and knowing what’s working and not working remains daunting. But it’s this journey stage where we see a gap in the capabilities of these Martech solutions. Many tools collect data but fall short of surfacing actionable insights based on analysis. This is where an insights-led customer engagement strategy comes in.
Customer insights help retailers provide more personalized experiences. According to The State of Insights-led Engagement Report 2022, 23.5 percent of North American retailers personalize communication based on preferred language and channel, followed by basic demographic data. However, only a few measure deeper insights (e.g., conversion, dormancy, churn) and behavior-based data (e.g., recency, frequency, monetary value). This has to change for retailers to improve their return on investment on multichannel customer engagement.
Retailers Are Divided on the Impact of Deeper Insights on Business Metrics
Just less than half (46.5 percent) of North American retailers believe in the high impact value of insights on their businesses. Their experience tells them that the revenue and growth of their organization are closely tied to these insights. Meanwhile, 36.6 percent of them remain neutral regarding their impact. This could be attributed to marketers measuring short-term metrics instead of valuable insights that could contribute to their ROI.
What’s Stopping Retailers From Achieving an Insights-led Approach?
There are multiple reasons behind retailers’ inability to gauge deeper insights that keep them from creating seamless customer experiences.
Tech Stack Limitations
A combined 64 percent of North American retailers employ customer relationship management (CRM) software, a customer data platform (CDP), and a customer analytics platform for customer engagement. Their tech stack lacks a multichannel customer engagement platform (CEP). While the others help gain a fair understanding of customers, CEPs provide a microscopic, insights-driven, and holistic view because they allow you to build a unified customer profile and drive a personalized, omnichannel experience for your customers.
Lack of Real-Time Analytics
For 31 percent of retailers, lack of real-time analytics is the biggest customer engagement challenge. Despite using a mix of CRM, CDP, and customer analytics platforms, marketers still struggle to derive deeper insights into their engagement strategies so they can course-correct. They mainly depend on campaign-based metrics.
Retailers have de-prioritized insights such as the long-term impact on revenue and campaign performance data. Nearly one-quarter (22.5 percent) of them continue to measure the most engaging customer segment in their campaigns. This indicates how marketers might not realize these insights’ impact on overall business growth. Additionally, their current tech stack also poses limitations.
The Road Ahead
So, now that we've identified the gap between what retailers think they’re doing right vs. what they need from their tech stack, what’s next? Too often, retailers focus on measuring campaigns running for a broad cohort of customers instead of prioritizing personalized messaging per the customer’s more in-depth preferences. If retailers want to maximize their investments in real-time analytics, they must pivot from a traditional campaign-based approach to a moments-based, customer-centric approach. A customer-centric strategy allows marketers to use near-real-time insights to build an effective customer engagement strategy.
Meagan White leads the North America marketing and sales development team at MoEngage, an omnichannel customer engagement platform.
Related story: 4 Recession-Ready Transformation Pivots Retailers Need Now
Meagan White leads the North America marketing and sales development team at MoEngage. She has more than a decade of marketing leadership experience within the Martech, customer experience, and content management sectors, managing marketing strategies in various functions, including demand generation, digital marketing, product marketing, and communications. She holds a master’s degree from Boston University.