Reset, Rethink, Retool: Finding New Opportunities in a Dynamic Market
The recent upheaval of the retail industry calls for a new operating environment for every business. Consumer behavior has changed, demand has shifted, and brand loyalty is in flux across industries and channels. To survive, you have to reimagine your business’s strategies, tools, and teams. Reset, rethink, retool is our strategic, three-step plan for adapting to change and finding new opportunities in a dynamic market.
Success is not just a matter of getting from point A to point B. On the contrary, success in any endeavor requires constant change and adaptation to one’s environment, reshaping oneself like water to fit the container one’s in.
The pandemic had a transformative impact on the economy, consumer behavior and attitudes, digital retail, the in-store experience, and the day-to-day working lives of professionals across industries. To succeed in today’s evolving retail environment, businesses need to reshape themselves—from the way their teams operate internally to the way they engage with consumers externally.
But the solution needs to be more dramatic than doing less of the same things you’ve always done. Reducing ad spend but using the same creative or pushing the same strategies less frequently are prudent, short-term strategies to manage costs, but they won’t help your business undergo the necessary transformation to continue growing in the post-COVID world.
Instead, you need to:
- Reset: Take the time to reevaluate your environment to understand the new rules of engagement.
- Rethink: Adjust your strategies, processes, and teams to capture new opportunities and mitigate emerging threats.
- Retool: Invest in new tools and technologies to streamline your adapted operations and boost your agility for the future.
A Customer Data Platform (CDP) partner like Lexer can help you do each. With precise customer insights, predictive analytics, powerful segmentation, effective tools to track change and quantify impact, and our experienced success team to offer strategic guidance along the way, you can easily understand, adapt to, and conquer the retail market as it evolves.
Reset: What does this new consumer environment look like?
Before you can make smart decisions about adapting to a dynamic market, you need to first re-orient yourself to the new reality of retail.
Recent, observable macro retail trends to look for include:
- Massive growth in digital and omnichannel.
- Shifts in popular product categories, with consumers prioritizing essentials and home goods.
- A boost in screentime and therefore increased social engagement.
You need to consider more than the high-level retail environment, however—you also need to use your owned customer data to make observations about how your core customer base is behaving in response to these changes. Evaluate the impact of change on your existing customer base and the types of new customers and prospects you’re attracting, as well as your competitors’ positioning and the greater market.
- WHO: Choose the population of customers that you want to analyze. By including both new and returning customers in your analysis, you can understand the influence of recent market changes on existing customer behavior as well as any differences in the types of customers you’re attracting as a result of the change.
- WHAT: To gain the most holistic customer insights, compare and contrast customer-centric attributes such as demography, transactional KPIs, products purchased, and third-party metrics such as Experian’s Mosaic Groups.
- WHEN: Compare three time periods including the current time period (e.g. this month), the time period directly prior to the current one (e.g. last month), and the same time period from the previous year (e.g. the same month last year). By analyzing these three periods together, you can distinguish between normal seasonal fluctuations and unexpected evolutions of a dynamic market.
Using this approach, you can measure the impact of specific changes on your business and customers. Once you’ve discovered key customer insights to reorient yourself to the new consumer environment, you can begin to think about how to adapt your business model for the future.
Rethink: How can I adapt my business model to these new consumer behaviors?
Adapting your operating model to this new consumer environment can take many forms. Think about the impact of these changes on the way consumers engage with your marketing, sales, and service to understand where and how to adjust for a better return.
In this uncertain market, retention has never been more important. With customer personas that are based on real data, you can maintain a steady understanding of your core customers and make better decisions about how to strengthen your current customer relationships and grow lifetime value.
For example, Brand Collective used CDP-powered customer insights about their children’s footwear brand, Shoes & Sox, to inform their digital strategy, re-create the brand experience online, and reinforce their brand positioning during the initial stages of the COVID-19 pandemic. By offering digital fit appointments, they were able to strengthen existing customer relationships while engaging new customers as well. Click here to read more about their experience navigating change with the Lexer CDP.
Additionally, acquisition has never been more difficult. Consumers are becoming increasingly cash-conscious and their preferences have shifted, so attracting new, high-value customers to your brand will require creative solutions to cater to these shifting demands and priorities.
For example, targeted sweepstakes campaigns are a great way to both acquire new prospects and re-engage lapsed or opted-out customers. Click here to explore our how-to guide for implementing a high-performance paid social sweepstakes campaign.
Ultimately, the most vital step to succeeding in a dynamic market is enabling your entire business to become hyper-focused on the customer. Customer-centric teams, tools, and techniques help you orchestrate consistent omnichannel experiences across every channel, maintain a consistent brand positioning, and genuinely engage customers with relevant and timely offers.
Retool: Which tools and technology do I need to help me adapt?
Consumer behavior has changed, accelerating the redistribution of customers from wholesale and brick and mortar to direct-to-consumer. To keep up with the market’s quick pace, you need tools to help you keep a pulse on what’s happening while maintaining agility and flexibility for the future.
In particular, you’ll need tools that streamline the progression from predictive customer insights, to audience segmentation, to cross-channel activation, to the collection of customer feedback, and more. With one centralized database to power each of these activities, you can orchestrate relevant experiences across every customer touchpoint while avoiding duplicate effort or miscommunication between teams.
That’s why CDPs are the key tool for survival in a dynamic market. CDPs solve the fractured customer experiences caused by fragmented data. By unifying, enriching, and transforming your data into a single customer view, you can gain clearer insight into and more control over the customer experience in retail. Although CDPs are typically known as a marketer-managed system, a CDP with analytics and activation capabilities can act as the all-in-one hub for every team to develop and execute insight-driven strategies.
As the only CDP to natively support all customer touchpoints, Lexer makes your data available to every team to inform customer insight and engagement. With AI-powered predictive analytics, third-party data enrichment, targeted customer surveys, powerful customer segmentation tools, and cross-channel activation, you can genuinely engage customers and drive profitable growth, even in a rapidly-evolving market.
To learn the top 15 reasons that Lexer’s customers choose (and renew) with us, click here.