DIGITAL SOLUTIONS
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Digital Progress Remains Challenging for Retailers
By Graeme McVie
Retailers have taken some tentative first steps with digital technologies and are continuing to feel their way
forward. While a retailer’s digital platforms or services do provide some benefits to the shopper, they have not progressed to the fullest extent possible. For example, retailer emails tend to deliver mass marketing messages in direct marketing mediums, frequently referencing nothing more than the standard weekly ad.
It’s common for grocery retailers to have websites. However, they are not quite in the league of Amazon, and could be strengthened with their recommendations based on past shopping history or based on other “like-minded” customers. And while a number of retailers have deployed smartphone apps, these apps have generally focused on basic functionality and tend to fall short in terms of personalized, relevant communications.
More recently, we’ve seen advances such as in-store beacon and facial recognition technologies being deployed to deliver coupons to customers when they’re in the store. However, retailers must be sure the shopper has opted-in to this type of service to avoid any potential negative impacts.
There’s no doubt we’ll see hurdles to both shopper adoption and operationalizing this level of data as digital technologies continue to advance. The fact remains that this new stream of data holds enormous potential to enrich a grocers’ understanding of and service to the customers if used correctly.
As I mention above, retailers are beginning to integrate digital tactics into their operations and marketing to increase customer engagement. However, there is still a ways to go. In terms of popular and effective tactics, several retailers have an online presence and offer services such as grocery delivery and/or click and collect services. Email communications and smartphone apps are also popular digital tactics.
Digital technologies offer retailers a great set of new capabilities. However, these capabilities also come with an increase in customer expectation. Most consumers are used to receiving a high level of personalization with their current digital experiences (for example, Amazon, Apple, etc.). If retailers do not deliver, then they risk falling into the trap of not meeting shopper expectations, even though they’re providing an incremental capability over and above the current state.
I believe the reason retailers are falling short in these ways is that they’ve focused predominantly on putting the technologies into place without understanding customer needs to a sufficient degree to fully deliver a positive, tailored and personalized customer experience. A personalized customer experience has to include customer analytics at its core or else retailers will not meet shopper expectations and consequently they will not realize the full value of their digital technology investments.
Graeme McVie is Vice President of Business Development, Precima, a leading retail analytics solution owned by LoyaltyOne. For more information, www.loyalty.com.
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