The retail landscape is rapidly changing, and in order for retailers to stay abreast of the shift in customer needs, they must harness the power of data. Analyzing all the data points available to determine how to best serve customers is one of the key factors to securing future business.
“The key component to being a good merchant is to truly understand the customer and to keep the customer at the center of all business decisions. This means that customer insights are invaluable to the success and growth of your business. If you ignore what the customer is telling you and blindly follow what you think is best, you will undoubtedly take a wrong turn. The customer’s opinion should be the north star guiding your business forward,” says Hillary Cullum, Founder of HSC Advisors, a retail consultancy.
A study by Forrester Consulting titled “Leverage Powerful, Flexible, And Scaled Customer Insights To Secure Your Business’s Future” evaluated the state of customer analytics and surveyed leaders across various industries including retail, media, technology, among others. The survey respondents stated that more-effective customer analytics programs led to improvement in customer trust, more agile decision-making, improved data processes and governance, delivering better customer experiences, acceleration of digital transformation initiatives, among other things.
Building trust with consumers is the first step to customer acquisition. The main goal of all content marketing is to gain trust and credibility with current and potential customers – it’s something brands are constantly working towards. With trust comes an increase in sales and future customer loyalty.
“If you’re obsessed with efficiency, as most businesses are, adopting a customer centric mindset creates customer value as well as business value. A great strategy is to infuse discovery continuously through your processes, find unique ways to connect with your customers, and conduct information interviews. This ensures you’re able to get fast answers along the way, for rapid iteration, and optimization. The most successful brands stay lean until they have found product market fit, and customer insights is a key tool to unlocking better decision making about which customer needs are the most important for your team to address right now,” advises Gabrielle Thomas, Founder of GT Consulting, a consulting company for health and wellness providers.
The Forrester Consulting study also stated that, “Analytics leaders are increasingly turning to AaaS (Analytics-as-a-Service) platforms. AaaS solutions help businesses by offering end-to-end capabilities that help to quickly and accurately transform insights into action.” In addition, more than 90% of the leaders surveyed agreed that their overall success as a business relies on data that is timely, accurate, complete, and accessible.
Data is obviously great intel to have, but it has to be analyzed and turned into action in order to effectively help gain customer loyalty and increase revenue. Insights from the data, coupled with a clear target market is the recipe for success.
“You must know and define who your customer is. Your business cannot serve everyone so having a clear customer profile allows you to filter through general feedback and the valuable feedback from your true customer. The perspective of the true customer will allow you to catch issues, identify opportunities, and validate ideas. The most successful brands have an in depth understanding of their core customer and a deep relationship with that customer that allows for open communication,” adds Cullum.
The Importance Of Customer Analytics
In the same study, 34% of respondents said that one of the ramifications of less-effective customer analytics is falling behind on digital transformation initiatives. At a time where technology and customer behaviors are rapidly changing, falling behind on digital transformation can be detrimental to a business. And 32% found that less-effective customer analytics can cause damage to customer retention, loyalty, and lifetime value.
Rosie Mangiarotti, Founder and CEO of Perkies, an innovative undergarments brand, summed it up as this, “Initial bottom-up research is necessary in order to figure out if a business is truly solving a customer pain point. Have the customers tell you what they need. From there, evolving and iterating are two things entrepreneurs have to be comfortable doing; we do this by listening to our customers. At the end of the day, companies live and die by their customers, and customer insights are critical for the success of a business.”