RETAIL DATA SOLUTIONS
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Retail Data Solutions
What are Retail data solutions?
Why do customers like to shop at particular businesses? What makes them go into one store instead of another? If you want to turn casual shoppers into loyal customers, these are the kinds of questions you’ll want to answer.
One way of doing this would be to ask each person who comes in what they enjoy about the store—the employee interaction, the selection of merchandise, the deals and promotions, or something else. You could then try to change your store and the way it runs to satisfy all those different preferences and needs at the same time in hopes of creating an experience that everyone would like. However, if you run a business with multiple locations, dozens or hundreds of employees, and an online marketplace, you know that isn’t going to work.
These are the problems that retail data software, such as Customer Data Platforms (CDPs), is built to solve. Retail data is any bit of information about the relationship between a customer and a business. How often they like to shop there, what they like to buy, whether they prefer to visit online or in-person, and how much they spend, are all types of retail data. Using data in retail lets you personalize the shopping experience to better meet the wants and needs of every customer. They can be offered products they like, given discounts, shown paid social ads they’ll respond to, and generally be treated as a valued customer and a top priority. If you can do this, customers will continue to build their relationships with your business—in other words, they’ll be more likely to come back, buy more, and recommend your brand to their friends.
Effective retail data solutions look different for every business, and there are a million different retail data tools out there to choose from. But in order to survive in retail, you need to invest in a tool that enables you to move from channel-centric to customer-centric operations. Here, we’ll cover the basics that every business should know about how the process works, what it does, and why it matters.
RETAIL DATA SYSTEMS
In order to create the ideal customer experience for every customer, businesses set up software networks to help collect, store, and analyze data about them. These are called retail data systems.
Retail data systems are built on the interactions between a customer and a business. This can mean anything from a purchase at a physical store to clicking an affiliate link to your site online. Every bit of accessible data about customer interactions is important: When they happen, how they happen, where they happen, and more. This data is collected by ads, third-party cookies, POS and register data systems, and employees in stores, and then compiled in what’s known as a CDP.
A CDP, or customer data platform, stores, integrates, and organizes all the customer data gathered from each interaction your customers have with your business. It keeps profiles for every customer and potential buyer who has ever made contact with you so that each new piece of data can be properly indexed and called up at a moment’s notice. The info in the CDP can then be fed into customer analytics programs that help employees, managers, and owners decide how to improve the ways they run their businesses.
There are four main types of customer data platforms, each with different strengths and weaknesses, including data integration, unification and identity resolution into a single customer view, analytics and customer insights, and activation of customer journeys across channels.
In a physical retail store, the CDP data could be used in conjunction with retail clienteling tools associates to recommend products to customers, sell them on a store membership or credit card, or offer them special discounts. When customers visit your website online, this data is used to personalize their shopping experiences. They’ll be reminded of products they looked at in the past, shown related items they might be interested in based on their search history, and informed of any current and relevant deals or coupons. When they’re elsewhere on the internet, the data will be analyzed to determine what kinds of ads to show customers and where and when to display them.
The kinds of data collected by these systems and the ways they’re used are numerous. The bottom line is that every new interaction between individual and business can be used to improve customer experiences in retail stores and online shops. That way they’re more likely to shop with you in the future and recommend your business to people they know.
Retail Data Collector
The first step in the process is collecting the data. Where you get it and how good it is determines what you can do with it and what kind of impact it’s going to have on your business.
There are many different types of customer data, KPIs, and metrics that you should collect, including:
- Customer lifetime value
- Recency, frequency, and monetary value (RFM) of purchases
- Customer satisfaction scores
- Ticket volume and common ticket topics
- Customer profitability
One place to obtain customer and prospect data is in a physical store. Here, shoppers ask questions, make comments, and purchase and return items. How long they spend in the store, which items they look at, and how much they buy are all observable as well. Thus, how a customer interacts with your business and how they feel about that interaction are plain to see and record.
Retail data collection in a physical location is done in a number of ways. Information about what items are bought (or returned), how frequently purchases occur, and how much money is spent can be easily captured at the register by POS software. Gathering more complex data about how customers are feeling, what their needs and interests are, what they think of your business or brand, and other things beyond the hard numbers can be done using customer surveys such as the NPS survey or through manual entry by sales or service team members. They can help capture this information by inputting it into the CDP.
Online, the kinds of data available are different, but no less important. Like in physical stores, online retail platforms can record and store information about what, when, how often, and how much customers are buying. In addition, detailed information about the paths shoppers are taking to make a site visit or a purchase are collected. Which sites they interact with your ads on, which search engines they use, what types of ads they respond to, and any relevant online survey data are all taken in and stored by automated retail data collector programs. This way, the right ads are put in the right places at the right times to reduce churn, improve retention rates, grow lifetime value, and ultimately drive incremental sales growth.
Collecting data both in store and online is vital in an age where e-commerce is so prevalent. There are plenty of statistics demonstrating the importance of data-driven customer experiences for retail and ecommerce. Shopping happens both in person and on a computer, and creating the best shopping experience for every customer requires taking both these platforms into account.
Retail Data Services
Knowing now how retail data processing and collection works, getting started may seem like a daunting task. If you’re a popular business with a lot of customers, or a small business with limited resources, setting up a working retail data system can be difficult and require a lot of time and energy. Because of this, many companies and CDP vendors now specialize in providing these retail data services to businesses for a regular subscription fee. But how do they help?
Some companies specialize in collection. If you run an online marketplace, they can help you set up the infrastructure to collect customer search, visitation, and brand engagement data. In physical retail fronts, they can upgrade your POS system to capture information about customer buying habits and product preferences. Some even offer coaching for employees and sales reps about what information to look for and how to craft a better shopping experience.
Other enterprises cover data storage and compilation. Depending on the size of your business, your CDP might need to hold huge amounts of information. The many customer profiles within this database also need to be easily accessible from a variety of locations and different devices. These data partners will help you integrate all the different branches of your system together into one versatile and user-friendly portal for better marketing, improved conversion rates in retail locations, more contextualized and efficient service, and boosted profits.
Finally, some companies offer solutions for retail data processing, customer analytics, marketing automation, data enrichment from third-party sources such as Experian’s Mosaic, and other use cases. Once you have sizable data on all your customers, you need to figure out how to leverage it. Specialized software can crunch all this data to show managers what customers like, what they’d like improved, which products they’re buying, which ads they’re responding to, and much more. Gathering the data is just the first step. Processing and presenting all this information to the right people in the right way is what drives change.
Exploring different CDP vendors and use cases can be a daunting task—how do you know what you can expect from a CDP deployment? To learn more, click here to read “How to measure the impact of a Customer Data Platform (CDP).”
Retail Data Companies
So, if there are dozens of companies out there specializing in retail data jobs and solutions, how do you choose which CDP vendor to work with? Each business has its own special needs and goals when it comes to data, and the best partner will have both the experience and expertise to make your vision of success a reality.
Finding the right fit can take time, but knowing who the top CDP vendors are is a good place to start. Cuebic helps brick-and-mortar businesses improve their online marketing effectiveness. Social media, email, and video ad strategies are tweaked and updated to draw more customers and increase purchases. Rubikloud is a Toronto-based company known for its AI-infused software. This tech is used for predictive analytics about what consumers are going to want in the future—what kind of products they’ll be interested in, how much they’ll want to pay, and more. Exchange Solutions offers software which collects and crunches a wide variety of data on customer behavior and purchase patterns. Their main goal is to help businesses build loyalty so customers come back again and again.
There are retail data companies out there dealing with every aspect of the shopping process. Lexer’s CDP stands out from the rest both for the diversity of its toolset and the power of its software.
Lexer offers solutions for every stage of the retail data analysis and activation process. They can help with data collection both online and in-store. They can build you a CDP with individual profiles for every customer and use these profiles to develop data-driven customer personas. They can analyze this data and offer solutions and strategies for acquiring high-value customers, reducing costs-per-acquisition with advanced targeting and customer segmentation, measuring and growing lifetime value, and more. Most importantly, they can combine all these functions together into a single system which is both easy to use and accessible from any platform or location.
Once you’ve decided which CDP vendor is right for you, you need to build a compelling business case that resonates with stakeholders. Click here to learn how to build a business case for a CDP.
Master your data in weeks
The Lexer Customer Data Platform serves as your all-in-one hub for insight-driven marketing, sales, and service. With an enriched single customer view, maintained in real-time and accessible across all platforms, you can genuinely engage customers and drive profitable growth.
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