Now is the Time to Prep for a Data-driven Holiday Retail Season
Please, retailers, enjoy the rest of the summer!
Tan, grill, softball, camp out, and eat watermelon until you are bloated by the sheer pleasure of it all and can do no more than lay on a beach in the warm sunlight like a Twitter fail whale. Have a mid-day snooze if you like – it’s still summer, after all!
But then, don’t be surprised if your sweet dreams are haunted by the ghost of Christmas future . . . that is, by the specter of the coming holiday season. For somewhere, deep down – below the hot dogs, lemonade, and home-made ice-cream – you know that it’s already high time to prepare for the most important eight weeks of the year.
High time, that is, if you’re a member of the special forces know as data-driven marketers. And sorry, you don’t qualify for membership in this club by doing some rough customer segmentation in October before the launch of the holiday campaigns.
Data-driven means understanding the customer data and insights at your disposal and managing them as strategic assets to meet and defeat the existential threats to retail success – or survival.
Data-driven retailing and the “relevance response”
We’ve just published my new report, “The Amazon Threat and the Facebook Trap: Retailers Can Win With Relevance in the Next Holiday Season.” In it, I outline how and why retailers have a data advantage that, if deployed correctly, can ward off the three Grinches that aim to ruin your holiday happiness.
I call this data advantage the relevance response. The words relevant and relevance are derived from a word in old French that could mean “helpful,” and “to lighten or lessen the load.” Helpful, pertinent, lightening the load – that’s precisely how retailers should aim to be perceived by shoppers. These are the characteristics that will result in your services (whether digital or in-store) being used, admired, and promoted.
The wealth of knowledge and insight harbored in the customer data that flows through a retailer’s myriad marketing, sales, service, and other internal systems can establish and nurture relevance in ways that the Grinches cannot. (Their hearts are, after all, two sizes too small.)
Three Grinches are out to steal your holiday success
The report explores the three main challenges to established retailers and analyzes the relevance response to each. Namely:
- The Amazon Threat: Amazon is like an irritating distant relative who shows up for Thanksgiving dinner, grabs the best parts of the turkey, dominates the conversation, and refuses to leave. Amazon captured nearly 43% of all U.S. online sales during the holiday season. That’s ten times more than second place Best Buy; taken together, the next ten retailers accounted for less than 25%.
- The Facebook Trap: Facebook is the irresistibly attractive and deeply mysterious stranger at the company Christmas party that you can’t help falling for, even though you should know better. It’s not that Facebook has over 1.6 billion users. It’s that about 1 billion of them spend an average of 20 minutes every day on the platform. Facebook’s unparalleled success is due to the fact that it has largely replaced nothing – that is, doing nothing, down time, the “empty spaces” in people’s lives when they’re not intent on doing something specific.
- Getting physical with digital: Energizing the in-store experience: You can win by treating stores as distributed, flexible warehouses. But the store shouldn’t feel like a warehouse when customers show up. When digitally empowered, “committed shoppers” do visit a physical store, the personnel have to be equally or better informed, and the ambiance should appeal to the consumer’s growing desire for digital engagement and experience, not just a cash register transaction.
Of course, the data-driven relevance response depends pulling together and intelligently managing the wealth of available data from numerous internal and dynamic resources. The report concludes with a discussion of what to look for in such an agnostic data layer.
Give yourself a holiday present
Now is the time to start, in order to prepare, implement, and test the solution well before the holiday season. With the data layer in place, the holidays will add more data, driving more insights, building more complete profiles, and positioning retailers to build better and deeper relationships in the future.
Contact us to discuss your retail strategies, including selecting commerce technologies and service provider partners.