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To Succeed in Retail, Make it Personal

Competing in the retail environment has never been more challenging. ‘Competitive’ is almost too soft a word to describe it – ruthless is probably more accurate.

As a group of consumers, we now expect the perfect retail experience. We want our needs to be known and matched exactly – a hyperlocal, personalised experience at every touch point – from marketing to the purchase process and after-sales care.

According to EssentialRetail, 95% of retailers stated personalisation as a strategic priority for their business. Yet only 15% admit to being fully implemented, with 43% saying personalisation efforts and initiatives are on the roadmap for 2017/18.

So how can we personalise the retail experience? Answer: Data.

 

Personalise the in-store and online shopping experience

Using data, you can find out exactly what your customers buy and when, how long they shop for, the optimum range size for sales, and who is your most profitable type of customer. You can then use this data to refine your range, improve the checkout process, and offer the optimum opening hours and delivery options.

Failing to listen to your data can come at a cost. This is a lesson supermarket giant Tesco has had to learn quickly over the last few years. Its strategy used to be bigger is better. Their mission was to be a ‘one stop shop’, with the ‘comprehensive range’ pulling customers in and stopping them going elsewhere.

At its peak, Tesco calculated that it stocked an incredible 90,000 products, with counterparts Aldi and Lidl stocking just a few thousand.

Taking just ketchup on its own as a product, Tesco stocked 28 different kinds – Aldi stocked just one.

 

With this strategy, Tesco recorded a historic £6.4bn loss in 2015, whilst Aldi had enjoyed four years of consistent profit growth at that time.

Sometimes consumers can be overwhelmed by choice. Psychologists believe that we humans only have a fixed number of choice-based decisions we can make in a day and we often would rather walk away empty handed than use up our valuable decisions on things like which ketchup we should buy.

Using this data, Tesco culled 20% of its range. Following the data-led strategy change, this year, Tesco reported a 30% rise in group operating profit to £1.28bn.

With this in mind, tailor your range choice to suit the needs of your customers rather than your own ambitions. If you’re not sure about how many options they would like to have, ask them. Or, better still, test it. Consumers may think they want more, but – in reality – your sales might show that a limited range performs better.

 

Personalise your marketing campaigns.

To deliver a personal marketing experience, again we need to listen to insights from data.

By combining sales data, with survey data and marketing data, you can know exactly how each individual customer thinks, how they want to shop and how they want to be marketed to.

Find out how often, when and on what channels your customers like to be marketed to. Then, look at which channels are most effective, segment your database to deliver personalised messages that relate to their purchase history.

By doing this, you can deliver impactful, personalised campaigns – meaning your customers engage with your marketing materials, rather than actively avoiding them!

You already have data to know the above – and more – about your customers. You just need to use it! By using this data you can strike the perfect blend of marketing approaches, you can market to your customers exactly when they want, with exactly what they want.

 

At AlphaGraphics, we specialise in helping retail businesses deliver data-driven, automated marketing campaigns to improve lead generation. To find out more, visit: https://retail.alphagraphics.co.uk/