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Strategy

How Can Retailers Provide a Personalized Customer Experience?

By Bluecore Marketing | August 2, 2016

In case you hadn’t noticed, the relationship between consumers and retailers has changed. In the past, retailers always had the upper hand. They chose how much information to share, what price to set for products and where they wanted to sell. Retailers did this, rightfully so, because they could. Customers were loyal to brands regardless of these factors.

But over the past ten years or so, technology has completely changed the balance. Consumers today are in charge and more empowered than ever before. They demand information they feel entitled to know. They pay the price they want. They expect a product to be delivered to their doorstep. They aren’t loyal to brands, they’re loyal to experiences. 

According to a recent study by Forrester, 68% of shoppers said, “I am unlikely to return to a website that doesn’t provide a satisfactory customer experience.” As a result, retailers today are competing to provide the best customer experience possible. But every time a customer is exposed to an improved shopping experience, their expectations are reset to a new, higher level. This leaves retailers today in the position of always chasing the customer.

The good news for retailers is that there’s a way to get ahead of this rat race and avoid being displaced; and that is by providing an personalized customer experience. This means engaging customers as a segment of one, in real-time, listening, capturing, measuring, assessing and addressing intent across every touchpoint. If this sounds like an incredibly daunting (and exhausting) task, it’s because it is. Although delivering this won’t happen overnight, here are a few ways to approach providing an personalized customer experience. 

1. Identify gaps in your ability to deliver an personalized experience

Before retailers embark on the journey of providing personalized experiences, it’s important to understand that personalization is not a revolution, but rather an evolution. It is not a rip and replace solution. It is an ever evolving strategy. The best way to approach this is to put yourself in the customers’ shoes. Think about the gaps in their journey where your brand isn’t furthering its understanding of the customer. This could be something as simple as not asking for an email address at checkout. Identifying these gaps will help you spot the biggest opportunities for improvement.

When The North Face looked at how they were interacting and engaging shoppers, they realized that they were focusing more on the “what” instead of the “why.” For example, they would know that a person was looking for a fleece jacket, but they wouldn’t know why they were going to wear it. Were they going camping? On a ski trip? Maybe they were just looking for something warm to wear around the house? All of these intentions were very different, and for some, a fleece jacket maybe wouldn’t be the best product for that shopper. By focusing on the “why,” The North Face was better able to recommend products that were best suited for that shopper’s intent, and as a result deliver a better customer experience.

2. Design each digital touch point to use and collect customer data

Once you’ve identified your gaps, the next step is to make sure every digital touch point both leverages and collects customer data. Your technology stack should be designed with the intent of continuously learning more and more about your customers, so when evaluating technology tools, ask the question, “Are we going to be able to capture information about that individual customer?” If not, that solution won’t get you closer to an personalized experience.

A great example of this is the Starbucks app. For customers, it is an easy way to pay and earn points for free drinks. For the Starbucks marketing team, it is a data collection machine. It is how they learn where you buy, when you buy and what you buy. They know what you buy when you travel, what you buy when you’re home and what discounts you need to be incentivized to buy more. Knowing all of this allows them to deliver personalized communications to each customer. If you’ve only ever purchased coffee, they probably won’t push you a discount for tea. If you buy from them every morning, they won’t send you discounts to encourage you to buy. All of this helps Starbucks operate more efficiently as an organization and engage customers only in ways that make the sense for them.

3. Take off  blinders and consider every part of the customer journey

All marketers can be guilty of putting on blinders and saying, “I’m only in charge of email” or “I’m only in charge of social” or “I’m only in charge of in-store experience.” But in order to provide a cohesive customer experience, marketing organizations can’t operate in silos. Marketers need to think about how they can create amazing experiences everywhere across channels.

Sephora is a retailer that thinks this way in how they connect in-store and online experiences. Customers can come into the store and learn about themselves, try different colors and find out about what types of makeup they should be using. In order to capture and store that information, customers must open up an account. If a customer then logs in online, all that information Sephora just captured is available to them. By crossing online and offline channels seamlessly, Sephora not only captures an immense amount of data for marketing, but also delivers an amazing customer experience that differentiates the brand from top competitors.

4. Be overt about data and covert about delivery

Finally, an personalized customer experience cannot be delivered without collecting a sufficient amount of data. Collecting this isn’t always easy, especially for information that goes beyond standard things like name, email address and zip code. The way to do this effectively is to be overt about why you’re asking for certain information, but covert in how it’s leveraged to deliver the personalized experience. 

Take Hudson Bay as an example. In order to create a True Fit profile, Hudson Bay asks customers about their body type (which is information most customers probably aren’t chomping at the bit to volunteer). However Hudson Bay avoids coming off as nosy (and creepy) by explaining why they’re asking for this information – to identify brands that fit you best.

As a less intrusive example, think of how often cashiers ask you for your email address. For retailers that simply ask for my email information, I usually decline because they’re not telling me what it will be used for. How is giving them my email address going to benefit me? But for retailers who ask for it and explain that it will be used to send a paperless receipt and store my purchase information, I happily oblige (particularly since I lose all receipts). They may also be using it to store information about the brands I tend to buy and then leverage that in their email communications, but that experience should feel seamless to me as their customer. Be overt about why you are capturing this information in regards to providing value the customer, but be covert about delivering a personalized experience. The more effortless the personalized experience feels to the customer, the more data is probably working in the backend.

Bluecore Marketing

Bluecore Marketing