Encouraging Customer Loyalty With Big Data Analytics
Not unlike a marriage, your business and its client base are going to have its ups and downs. There are definitely some similarities between companies and their customers and a marriage—and as with marriage, the divorce rate is high when both parties aren’t on the same page when it comes to matters of money and priorities.
One of the most effective way we can show our customers that we value each and every one of them as individuals is to break down the big data in a manner that helps us cater to their unique, personal wants and needs. One of the most effective ways to do this is to make sure they feel like themselves—an individual—when they shop with us or hear from us, everywhere from social media channels to email blasts and when they receive mailers from us.
These days, very few people want to hear, "How can I help you?" Today’s consumers are walking into stores (online or brick and mortar) with a sort of tacit understanding that they are known and understood by the retail workers who greet them. It would be creepy if spoken out loud, but is clear that a comfortable dialog is taking place between retailers and their customers. As long as it’s intuitive and essentially a type of clairvoyance that's based on business intelligence for retail, it’s all good. Think of it like this: Jane has been a big fan of the bandeau tops available from a medium-size retailer in her area. She has shown interest by visiting their website, clicking on images of the bandeaus, and looking at them in the same size over and over, but in several different colors, and has also “liked” the company’s Facebook page.
Now if Jane had a client number, or customer ID number by becoming a member to earn points toward purchases, or because her email was on file, customer service representatives could help Jane better by swiping her customer card or asking her full name when she walks through the door. They would be able to see what Jane has been coveting—the bandeau. In this scenario, the store clerk says, "Hi Jane, we have the entire spring line of the bandeaus—did you want to try on some of the different colors? I can set you up a dressing room if you like.”
Now this shows big data collection doing two things: Saving Jane’s time so she’s more likely to enjoy her visit because she already knows what she’s there for, and secondly, it improves sales transactions at the point of sale by closing deals faster. And when it comes to the holiday season in the retail industry, nothing says I love you like an expedient sale. It’s a total win-win, all thanks to data analysis.
Once Jane has walked through the door of the bandeau retailer several more times, her buying habits are even more predictable. Is she coming in on the first of the month, the end of the month? Is she coming in on typical paydays, like the 5th and 20th of the month? If so, we can tell when Jane has disposable income and anticipate her next visit—and by then we may even know what she has her eye on again. When this cycle has repeated with a large percent of our client base, we can very accurately predict not just what an individual like Jane wants when she comes in, we can now aggregate data about many Janes and anticipate how much of what inventory we’ll need in a much more accurate way. For example, if by customer ID or email address, when looking online, if 25% of the bandeau retailer’s clients are looking at size small, it would be wise to ensure that at least 25% of the inventory they order to showcase in the store is available in this size.
Predictability like this by way of big data is where the retail experience is headed, and it works a lot more to the favor of the retailers and their consumers. When clients feel catered to, they are also likely to be loyal. The next big challenge is to make sure your retail outlet is doing a better job of using big data than the competition—this might mean knowing more than Jane’s size and style and when she has available cash flow—it means giving her a reason to stay in love with you, and that means not just seasonal specials, but discounts sent straight to Jane’s email tailored just to her, like 15% off all new bandeaus. Be Jane’s buddy, be there for her, offer her nice things, and watch the relationship bloom while your profits increase.