Every marketer realizes the real power of customer data today, but are they being able to extract full value from it and use it to its full potential? Customer data is one of the most valuable assets for businesses in the retail sector and if leveraged properly it can help largely in boosting sales performances. But then, the marketing landscape is continuously evolving, and enticing customers to continuously buy and become loyal to one’s brand demands a totally new view.
With the infusion of new technologies, customers have become the king today, they are the ones who dictate how and where they plan to shop. Well, the thought of customers taking charge of the market can be daunting, therefore smart retailers are finding innovative ways to please their customers. Marketers are creating an all-inclusive view of every customer segment and reaching specific audience groups in more personalized and appropriate ways.
But again, this demand combining the company’s critical data across several sources, this is exactly where Data Management Platforms (DMP) come into play. Let’s understand how DMPs can help retailers drive their marketing plans and reach customers more efficiently and effectively.
Key Challenges Faced By Retailers Today
The number of choice customers enjoys today has led to a waning of the brand loyalty concept. Consumers conveniently switch between online or in-store channels and retailers, but their ultimate choice depends on which channel suits or serves their needs in the best possible way. Sadly, retailers aren’t immune to this trend they face hordes of different challenges. Let’s list them down:
High Customer Expectations – Customers’ expectations are continuously growing, brands need to assess and enhance the entire customer journey to match those expectations.
Multichannel Buying Experiences – Today customers use online shopping but at the same time make purchases in-store. Customers are moving effortlessly between online and offline experiences and retailers need to best facilitate these transitions.
Expect a Seamless Experience – Switching between online and in-store, customers not only expect the same product to be available, but they also expect their shopping experience to be seamless.
Attract Customer Loyalty – With the sea of options available to the consumers, the concept of brand loyalty is fading away. Retailers need to offer their customers an experience which is totally outstanding.
Siloed Marketing Infrastructure – Modern marketing is all about communicating and engaging the customers across different channels, like email, SMS, and social media. But, so many discrete channels also mean siloed customer data.
Data Challenge – The amount of data collected by businesses keeps growing at an alarming rate, businesses need to make sure this data is put to right use and that it doesn’t contribute towards the data silo problem.
Significance Of Data In Retail
Business in the retail sector mostly run on trends, hence it would be imprudent to ignore the relevance of data in retail. Predominant customer opinions and views determine new and recurring trends and also ones which don’t work. Today, efficacious retail businesses mostly depend on concrete metrics, facts, and accurate data to make crucial business decisions. Here are a few reasons that make data a necessity for retail businesses:
Improved Customer Experience – Data makes it clear which consumers are buying which products. It also helps in personalizing customer experiences which further helps in enhancing the customers shopping experience and loyalty.
Improved Strategic Decisions – By combining disintegrated retail information businesses get an overview of business outcomes which includes consumer trends and growth strategies, also it unveils important metrics like pricing and promotion.
Enhanced Operational Performance – Data helps the businesses to ensure that their bestseller products are never out-of-stock. Also, data analytics allows the businesses to spot the most popular items, opportunities, and seasonal trends which help them adjust their replacement, forecasting, and marketing strategies.
Having A DMP Strategy Can Help
To maximize profits and gain customer loyalty in the ever-changing marketing world, retail businesses need a closer and deeper look at their customers. And one of the best ways to do this is by using data analytics, but one cannot ignore the fact that data in retail is scattered and siloed. Well, having a DMP strategy can help.
- Retailers can fuse disparate sets of data and get big-picture understanding across all channels, platforms, and campaigns.
- Spot trends within the current audiences and determine more targetable segments which would most likely result in more conversions.
- Automatically and seamlessly process millions and billions of data points and get access to highly detailed insights.
- Retailers can better understand which segments are worth targeting and which aren’t, they can focus their resources on those audiences which have higher-value and higher-ROI.
DMP Use Cases For Retailers
DMPs collect data from disparate sources (For retailers, it can include online and offline purchase data, social data, loyalty shopper data, and search data) into one single platform. After that, it turns this raw data into valuable audience insights which help in driving the retailers marketing plan and reach their target customers more competently. Keeping this in mind, here are some use cases of DMPs exclusively for the retailers.
1. Cross-Channel Audience Insights
One of the main purposes of using a DMP is to collect and organize data from multiple sources so that the data can be activated to release its real power. With the unification of data, retailers can easily combine offline data, CRM, POS, mobile, search, rewards or loyalty programs and many other similar sources of data which further gives them access to an all-inclusive view of different channels, platforms, and campaigns. Combining data points to your DMP also help in providing a complete picture of the customers. Here are few data points which can help:
- Purchase behaviour from previous interactions
- Income of a household
- Real-time user behaviour understanding
- Which product/service is picking maximum customers interest
Retargeting is basically trying to reach those customers who may have already been on a brands website or mobile application but didn’t convert. DMP allows the retailers to retarget such customer groups based on their past activities or behaviour. This holds even more significance when DMP is integrated with a DSP, as it allows to send the audiences to any platform for instant targeting.
3. Audience Categorization
DMP helps in segmenting the audiences based on different criteria’s, like age, gender, interests, income, spending history, wants and needs, this helps the retailers to target their audiences more accurately. Remember, better targeting of customers eventually means better returns on marketing investments. This can precisely be achieved through audience segmentation. Here are few examples of few segments a retailer might explore to target:
- Frequent Buyers – Consumers who have made a purchase at least three or more times in a year.
- High Average Order Value (AOV) Buyers – Consumers who spend more dollars on one single purchase.
- Impulsive buyers – Customers that make a buying decision in an instant – spends less time browsing the portal
- Category Buyers – Consumers who purchase in specific categories in product niche.
- Refill Customer – Consumers who purchase products which demand continuous replacement/replenishment.
- Dynamic Segments – Group of consumers who spend based on special occasions or activity dates, like holidays or Sale.
4. Lookalike Targeting
This model applies existing customer intelligence to seek new audiences who share similar characteristics. DMPs apply proprietary algorithms and discover more customer profiles which are like the brand’s original audience. It basically helps them extend their reach to a new set of customers.
5. Omnichannel Messaging
DMPs gives the retailers valuable information on which devices their target audiences are using and what they are doing. A retailer who uses cross-device technology from a DMP can easily sync their offline, online, and mobile messaging for one unified experience for their customers.
Today personalization plays a key role in marketing. Offering customized content to the audiences increases engagement and the chance for conversion. DMP helps in creating audience segments and at the same time gives the retailers a chance to know their audience on a personal level. This can be immensely useful for offering personalized experiences to the audience.
7. Location-Based Targeting
Geo-targeting helps the retailers to target audiences who live specifically near or pass by a particular store. DMPs can help the retailers connect to other location data providers who offer geo-targeting abilities beyond zip code or DMA.
In the era of competitive shopping, it is critical to not just know your target audience but to understand them and find ways to connect with them. Gone are the days when retailers used to sit, and consumers came to them. The time has changed, and so does the ways to bring more customers to your shop.
DMPs serve as an excellent tool as it helps in reaching the right audience at the right time with the right message. Want to learn more? Contact Cuberoot to set up a free demo at our premises.