SOCIAL MEDIA
SECTION ONE
SECTION TWO
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SECTION THREE
Retailers Often Underutilize Customer Data: Report
Many successful retailers have embraced social media as a critical tool to interact with
shoppers. But how important is social media to a successful retail operation?
According to consultancy A.T. Kearney, less than half of retailers collect social network data that could be useful to them. What’s more, only 8% believe that social networks are very important in generating insights as to how to improve their operations and sales.
At the same time, well-trained employees need to interact in the store with customers. Such valuable personal touches gain insights directly. So what’s needed is a blend of customer data analysis and fresh shopper insights.
Those were some of the findings contained in A.T. Kearney’s 2013 Achieving Excellence in Retail Operations (AERO) study, which tracked best practices by leading retailers, especially as relates to fast-moving technology and multichannel shifts and an increasing focus on the voice of the customer.
The research found that leading retailers are much better than run-of-the-mill competitors at collecting data through social media and other means, at acting on their insights from the data by tailoring the customer experience at a granular level, and at measuring the results of changes they make. A.T. Kearney refers to this principal as Measure, Analyze, and Act.
The study also found that there are many underutilized sources of customer data. Retailers should increase their investment in the technology and skills to take advantage of these data sources. For example, as noted, less than half of retailers collect social network data from third-party domains, and just 8% say it is “very important” in generating insights.
Another insight from the study was that even with the proliferation of technology and vast quantities of store and customer data, retailers also need to focus on the core principles of retailing - employees, customers, and the interactions among them. The study found that retailers that most actively engaged their employees and customers were the most successful.
“Leading retailers encourage measurement of the right data, invest in the skills to gain insights from that data, and use those insights effectively to frame future actions,” said Joel Alden, A.T. Kearney partner and co-author of the study.
The study also focused on how retailers were managing the multichannel environment. In this new environment, customers will often return products to a store that they ordered online, or ask a store employee to order an out-of-stock item through another channel. When employees are not measured on the success of non-store channels, they have little incentive to encourage the growth of those channels.
The AERO study addressed the importance of front-line staff. These employees interact with customers all day long, gaining valuable insights into customer needs, but few retailers take full advantage of these insights.
“The problem today is a lack of formal requirements or processes to gather these employee insights. Leading retailers create formal pipelines that capture and use these insights,” said Adam Pressman, A.T. Kearney principal and co-author of the study.
Dean Hillier, A.T. Kearney partner and another study co-author, commented, “With all of the moving parts, retail leaders dedicate resources to effectively driving and managing change. This includes focused and measured pilot efforts, tailoring communications and communication channels based on messages and employee groups, and focusing on continuous improvement, not just one-and-done mandates.”
A.T. Kearney’s Achieving Excellence in Retail Operations (AERO) study provides insights into how retailers around the globe can improve their operations. With more than 100 questions, the survey probes the strategy, tactics, and execution of retailers in more than 20 countries. It covers multiple sectors, including apparel, health and personal care, mass-market and hypermarket, electronics, food and grocer, and cash and carry. The study is based on A.T. Kearney’s Store Operations Framework. This framework, which was also used to pioneer the 2010 study, breaks operations into categories that set strategic direction, deliver core value, optimize expenses, and drive lasting change.
