Partner Voices: The Role of Digital Intelligence in Delighting Customers
The emergence of digital communication and sales channels has presented both opportunities and challenges for retailers. On the one hand there are more ways than ever for brands to engage and interact with customers, from social media to mobile apps to email, to name just a few. Yet with those additional touchpoints come increased customer expectations for a top-notch experience at every point in the purchase journey.
And if consumers don’t get the experience they’re looking for? They simply move on to one of your competitors, which is a mere click away.
One of the primary benefits of interacting with customers in multiple channels is you get to know them better – i.e., collect more data about them. That data then provides the foundation for all future communications between your brand and the customer. However, there is a catch. In exchange for sharing personal information with brands, consumers have come to demand a personalized shopping experience – no matter how they choose to engage. Consumers have set the bar high. Brands that can deliver on those customer needs will win their loyalty; brands that can’t will struggle to survive.
Personalization Drives Conversions
Personalized content and offers have proven to be more effective at driving conversions. The days of batch-and-blast messaging and sending generic content and offers to all customers are slowly coming to an end. Retailers are investing significant time and resources into leveraging the vast amounts of customer data they have – e.g., transactional, demographic, psychographic – to make the shopping journey, from product discovery through post-purchase, personalized.
A retailer’s approach to personalization that adequately covers the breadth of data, analysis techniques and delivery of insights to support decision making requires an evolutionary step beyond traditional analytics. “Digital intelligence” can be a competitive asset, and it’s defined by the following characteristics:
- Customer centric: Provides a holistic view of your customer across all channels.
- Enterprisewide and data agnostic: Digital intelligence incorporates customer data management capabilities across a broad range of data types, including interaction and behavioral data as well as customer and business data.
- Actionable: Digital intelligence is readily actionable and generates insights that help retailers make decisions and take actions that improve the customer experience. Furthermore, it’s able to exported to third-party optimization and marketing execution systems.
- Timely: Digital intelligence delivers analysis in real time or on-demand, helping retailers keep pace with today’s always-connected consumers.
- Tightly managed: Digital intelligence offers access to a suite of management tools, including tag management, data syndication, centralized user and functional administration, data warehousing, and data processing. These tools facilitate the availability of high-quality data for analysis.
Better Experiences Breed Customer Loyalty, Improved Bottom Lines
The concept is simple enough: the better experience you’re able to provide your customers, the more likely they are to come back to purchase again. An organization’s ability to deliver optimized customer experiences based on data and insights is a true differentiator in today’s ultracompetitive retail environment. That includes tracking customers as they shift from channel to channel, oftentimes in the course of a single purchase journey – e.g., from mobile to in-store before making the final purchase on desktop.
Likewise, brands that aren’t able to deliver the seamless, hassle-free shopping experiences that customers now demand won’t build long-term relationships with them. Sure, they may be able to get a customer to buy from them once, but can they get them to come back? It’s those repeat customers that are most profitable to brands. Consider that, depending on the industry, it can be five times to 25 times more expensive to acquire a new customer that it is to retain an existing one. Furthermore, increasing customer retention rates by 5 percent increases profits by 25 percent to 95 percent, according to a recent study by Fredrick Reicheld of Bain & Company.
You can see the impact that customer loyalty can have on a company’s bottom line.
Therefore, loyalty built from one-to-one relationships with customers is what today’s retailers are striving for. There are many impediments to being able to provide that, chief among them disparate systems and technologies that don’t communicate with each other. What good is having a treasure trove of data about a customer’s purchase history if customer service teams can’t access that data when trying to solve a problem?
Finding the Right Digital Intelligence Partner
Systems and data that are integrated across all functions of a retail business are necessary to provide a 360-degree view of the customer. With that 360-degree view, personalized content and offers can then be served up, which increases conversions. The first step in this process for most retailers is identifying a third-party vendor to work with for securing tactical and strategic support in the implementation and scaling of digital intelligence.
Here are four things that you should be looking for in that search:
- Technology: Your analytics provider must employee a combination of technologies to collect, process, store, analyze and distribute digital insights.
- Ownership: Digital intelligence must be part of the company’s culture rather than an isolated function. While marketing and e-commerce teams are typically the primary beneficiaries of digital intelligence, the practice remains highly technical and dependent on advanced analytical skill sets. Therefore, ownership is best shared across all units of the business.
- Key performance indicators (KPIs): With access to more raw data and links across data points, digital intelligence forces retailers to reconsider traditional KPIs. For example, bounce rate could be used as a trigger for personalized messaging intended to drive certain actions.
- Continuous optimization: Ongoing testing is the only way to evaluate all of the various digital touchpoints to determine which content, promotions and interactions will optimize the customer experience, and thus drive more conversions. Digital intelligence must use testing and targeting as tools for making analytics actionable and embedded in all marketing activities.