Category Archives: Customer Engagement & Business Intelligence

by Retail Pro

Repairing relationships with unhappy customers

In the retail industry, customer relations are key. Merchants reach out to consumers in a variety of ways, including personalized email campaigns, social media, customized offers and engaging in-store experiences. Unfortunately, retailers can't please everyone, and even the best stores sometimes make customer service mistakes. In an era where consumers can rapidly spread discontent through online platforms, it's important to make an effort to repair relationships with dissatisfied customers.

When shoppers voice their dissatisfaction on social media networks, it's best to respond rather than let the comment simmer. The Connection, a contact center blog, suggested retailers respond as soon as possible, keeping a positive tone and maintaining professionalism. If possible, the source said, it's helpful to move the conversation to private channels, but merchants shouldn't delete the original comment because that looks like they're trying to cover up mistakes. Additionally, despite improvements in the way retail management software integrates channels, it's best to respond to customers in the same way they offered feedback, according to Social Barrel.

Regulating online feedback is important for retailers as the multichannel approach becomes more central. According to The Guardian, it's more essential than ever for merchants to build brand loyalty by engaging with customers.

by Retail Pro

Consumer spending drives U.S. economic growth

The U.S. economy rose by 3.2 percent in the fourth quarter of 2013, pointing to optimistic prospects for the retail industry in the coming year. Consumer spending increased by 3.3 percent, marking the greatest growth in three years, Bloomberg News reported. Consequently, some retailers are experiencing greater demand and better business conditions.

The growth comes after a period of challenges for the economy. Not only were markets abroad impacted by the European economic crisis, but U.S. government spending cuts, fiscal battles and a government shutdown caused setbacks. USA Today noted that the last half of 2013 was the best economic stretch since the end of 2011. Economists are hopeful that the country has finally overcome some of the challenges that occurred over the past few years.

"For a period that included a government shutdown, it was a pretty successful quarter," said Sam Coffin, an economist at UBS Securities LLC in Stamford, Connecticut, according to Bloomberg. "The momentum carries over into this year. The worst of the fiscal battles is behind us. We'll see the economy picking up."

Some businesses are already seeing greater demand, the news source said, and retail customer trends indicate that Americans are spending more confidently thanks to job growth and property value improvements.

by Retail Pro

Three ways to use retail business intelligence

Modern retail technology has made it easier for merchants to collect large amounts of data about customers and their shopping habits. By consolidating and analyzing this information, retailers can streamline their store operations and optimize their marketing strategies. Here are three types of insights that business intelligence can provide:

  • Sales trends. Merchants need to know which items are trending and predict what customers will want to purchase in the near future. Nathan Roberson, editor for The Marketing Robot, explained in Business2Community that retail reports can break down data according to many metrics, providing merchants with insights into their target markets. Upshot's trend report noted that marketing in the moment with real-time analytical information is increasingly central to business success.
  • Customer profiles. Getting to know patrons helps merchants provide relevant services and improve their marketing strategies. It also facilitates personalized campaigns, which Upshot recognized as one of the key retail trends for 2014.
  • Store operations. Sales and inventory data can help retailers make better decisions, such as warehouse organization, supply chain and employee performance, Roberson said. Managers can also use insights to design more effective displays. For example, they can coordinate items that shoppers frequently buy at the same time.
by Retail Pro

Improve store operations with better inventory management

Online retailers and brick-and-mortar shops alike depend on good inventory management to run an efficient business. Having the products customers want, when they want it, can be the determining factor in who makes a sale. Because warehouse space is limited and shipping takes time, merchants need to optimize their inventory processes.

David Sasson, president and co-founder of overstockArt.com, described the challenges and best practices for effective inventory management in Practical Ecommerce. It's important to hold stock, he noted, but usually inefficient to buy a lot of items in bulk. In fact, retailers have the highest return on investment when they maintain revenues while holding the least inventory.

Businesses can use retail customer intelligence to anticipate what consumers will want to buy before the demand peaks. In Entrepreneur magazine, Ronald L. Bond, a retail business owner and consultant, advised store managers to watch for indicators such as:

  • High-selling items with limited stock availability
  • Slow sellers and seasonal goods that can be replaced with more popular items
  • Hot sellers with rising sales

Retail management software can help merchants identify trends and better track the inventory they have on hand. Integrated systems can also take advantage of technology such as RFID tags to maintain more accurate records of product location.

by Retail Pro

Optimize loyalty programs with retail customer intelligence

Retailers devote significant portions of their marketing budgets to converting customers, but they should also focus on maintaining relationships with patrons. Research has shown that the greatest amount of business comes from loyal shoppers, not from impulse buyers or browsers. Loyalty programs are a common tactic for drawing customers back again and again, and these strategies can be enhanced with retail customer intelligence.

According to eMarketer, customers now expect greater personalization in retail offers and services. With new technology, merchants are able to tailor their marketing messages and suggest personalized deals to consumers based on their shopping history and preferences. This same approach can improve loyalty programs. The source pointed to RIS News findings that indicated the majority of North American merchants plan to invest in the near future in behavior analytics as well as pricing and communications personalization for their loyalty marketing programs.

Jim Daleen, CEO of AppSuite, also recommended making loyalty services more personal. A sophisticated program, he said, can offer shoppers customized benefits based on information like birthdays and spending milestones. These types of rewards don't just provide customers with incentives – they also make customers feel appreciated and recognized, he noted. 

High-end retail technology can help merchants revitalize their loyalty programs by making it easier to sign up customers and gather information about shoppers' purchases.

by Retail Pro

Consumer confidence hits new high in January

Retail customer trends and recent reports point to rising consumer confidence. According to The Conference Board's monthly Consumer Confidence Survey, Americans' confidence in the economy and business conditions rose in January for the second month in a row, reaching the highest point since August 2013. The Consumer Confidence Index rose from 77.5 percent in December to 80.7 percent this month, and the Present Situation Index increased to 79.1 percent from 75.3 percent.

"Consumers' assessment of the present situation continues to improve, with both business conditions and the job market rated more favorably," said Lynn Franco, director of economic indicators at The Conference Board. "All in all, confidence appears to be back on track and rising expectations suggest the economy may pick up some momentum in the months ahead."

Higher confidence in the economy is good news for retailers, who also saw their sales increase over the last few months, Bloomberg News reported. The Department of Commerce Monthly Wholesale Trade report, released on January 10, showed that November sales were up 1.0 percent from October and 5.5 percent year-over-year. In addition to holiday shopping at the end of 2013, cold weather helped spur business because shoppers needed to buy warm outdoor clothing and other seasonal products, Bloomberg noted.

by Retail Pro

Merchants focus on customer empathy

With big data capabilities, merchants are increasingly using retail business intelligence to improve the shopper experience in their stores. To attract customers and engage them after their visit, brands are aiming to offer interactive experiences and personalized assistance. 

The rise in emphasis on the customer experience inspired the Temkin Group to name 2014 "The Year of Empathy," Retail Customer Experience reported.

"As companies increasingly focus on customer experience in 2014, they will recognize that their organizations lack a deep understanding and appreciation for their customers," said Bruce Temkin, managing partner of Temkin Group, according  to the source. "In 2014, we'll hear more executives talking about the need to build 'empathy' for customers."

Empathy includes anticipatory service, such as personalized offers driven by retail customer intelligence, and greater integration across channels to produce a seamless experience for shoppers. In an attempt to bolster consumer engagement, retailers are imagining possible frustrations and seeking innovative solutions, San Jose Mercury News reported. For example, merchants can use shopping trend data to improve their store layouts and mobile POS systems to make checking out easier. Interactive technology, such as virtual dressing rooms, turns brick-and-mortar shopping into a fun encounter.

by Retail Pro

Retail customer trends point to the importance of loyalty programs

From club memberships to mobile apps, merchants encourage customers to return by offering them incentives like discounts or gifts in exchange for their loyalty. But are these retail marketing strategies really worth the investment?

According to the RJMetrics 2014 Ecommerce Benchmark Report, repeat customers are one of the best assets a company can have. The study found that the top 1 percent of a retailer's shoppers provide more business than the bottom 50 percent combined, Practical eCommerce reported. Therefore, it's well worth the time and effort to foster lasting relationships with customers.

Loyal customers spend more often and buy more each time
The RJMetrics report corroborated findings by an Adobe study from last year indicating that return customers spend greater amounts on each purchase, the source said. Repeat shoppers also tend to require less customer service, reducing human resource costs.

Therefore, while retail marketing campaigns often focus on converting shoppers, it's essential for merchants to maintain good relationships with existing customers. This is a consideration for email marketing and other ad campaigns, where loyalty can be won or lost depending on whether emails are helpful or seem like spam. 

Loyalty programs
Offering customers incentives to return is an excellent strategy for building loyalty. These programs are most effective when they make use of technological options and focus on relationships, not just numbers. For example, retail customer intelligence makes it possible to offer shoppers personalized rewards based on their shopping activity. 

At the National Retail Federation (NRF) Convention, held January 12-15 in New York City, industry leaders discussed some of the ways they are using mobile to transform their loyalty programs. Representatives from Century 21 explained how they created a mobile app to optimize their four-year-old loyalty program, the convention newsletter said. The app makes the loyalty program more exciting and interactive by giving customers the opportunity to spin a prize wheel and it informs loyal shoppers when there's a flash sale, the source explained.

Loyalty programs are strongest when they foster a relationship between consumers and retailers. At the NRF Convention, representatives from Sephora emphasized the importance of having employees involved in promoting loyalty programs, particularly when they're excited about engaging apps, the newsletter said. Merchants can include loyalty apps in their POS retail management software to make it easier for employees to add customers to their program.

by Retail Pro

Single platform system improves multichannel store operations

Merchants that want to improve customer engagement, data analytics and retail inventory management require streamlined, efficient retail technology. According to a recent report by the National Retail Federation (NRF), Demandware and the University of Arizona, 35.8 percent of retailers are considering a single-platform solution to help them manage their multichannel operations.

The survey polled more than 200 retail business technology executives in the U.S. and Europe and found that the majority plan to upgrade their retail software and increase or maintain technology investments. With the growth of ecommerce and omnichannel marketing, many companies see single-platform solutions as the best choice.

"In this consumer-led industry, retailers are working overtime to keep up with the expectations and demands of their savvy customers, and are intent on integrating the digital shopping experience like never before," said NRF Vice President of Retail Technologies Tom Litchford.

A single platform is advantageous because it seamlessly integrates information from all channels. Store associates can have instant access to updated inventory information on their retail POS devices after an online sale occurs. It also facilitates comprehensive customer intelligence. As IBM CEO Ginni Rometty said at the NRF Convention, big data is becoming a "natural resource" for the retail industry, and businesses need access to consolidated, up-to-date information.

by Retail Pro

Email remains a key retail marketing tool

The 2014 National Retail Federation (NRF) Convention, held January 12-15 in New York City, showcased some of the brightest innovations in retail technology. However, research shows that new strategies like social media advertising and mobile apps are no replacement for some of the classic tools of the trade. Just as the importance of customer service will never die, email is likely to remain a winning strategy for years to come.

According to a recent McKinsey & Company report, email marketing is nearly 40 times more effective for customer conversion than Facebook and Twitter combined. Despite the gains made by Facebook messaging services, email remains the primary means of electronic communication, which means that it's generally the most reliable way to reach customers.

Of course, merely getting a message to an inbox is not enough. There are a few best practices that retailers can follow to make sure their emails have a greater impact.

  1. Always be useful. Justin WIlliams, a marketing strategist for StrongView, reminded retailers that usefulness is the key to having customers open emails time and again. Whether merchants are sending email receipts or deals, they should use retail customer intelligence to personalize the message and options.
  2. Give subscribers options. Williams and McKinsey & Company agree that bombarding customers with emails can be counterproductive. Regular contact is a good thing, but not when it's unsolicited or annoying. Letting individuals choose which types of emails they want to receive or how often they want to see deals can help retailers foster positive engagement. Merchants should make it easy for customers to unsubscribe and resubscribe so they don't feel like they're being spammed.
  3. The click is not the goal. McKinsey & Company suggested that customized landing pages, rather than links to generic home pages, are far more effective because they're more useful for customers and they draw people deeper into the shopping journey.
  4. Plan for mobile. As individuals increasingly read email on mobile devices, email marketing strategies must incorporate designs that are optimal for the platform. That includes designing buttons and links that are easy to select with fingers rather than a mouse.
  5. Be trustworthy. The need for secure links and ecommerce software is a no-brainer, but retailers must also make sure their emails are reassuring and dependable. Williams recommended keeping language, style and images consistent so customers know what to expect. This also helps consumers recognize emails that falsely claim to represent a company.