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How to harness the power of data to win customer engagement
Chris Kronenthal, president and CTO at FreedomPay, shares his insight on why retailers must understand their customers and tap sophisticated analysis of purchasing and personal profile data.
March 2, 2020 by Chris Kronenthal — President + CTO, FreedomPay
Data is a valuable commodity for retailers and any company making good use of data to help and incentivize their customers to interact with them are set to benefit ahead of their competitors.
Understanding customers, their drivers to action and what makes them return to your business again and again can all be identified with sophisticated analysis of purchasing and personal profile data. But without using this effectively, you face the prospect of being left behind by both your competitors and your customers.
The kind of data that can help retailers offer the best service is myriad, but each will provide at least one means for the company to improve its services and generate additional profits:
Busiest transaction times
Knowing when your busiest times are can help you improve workflow for your business by incentivizing customers to come to your store at a different time. For example, food retailers will have a busy time throughout the lunch period, with a peak usually seen between 1230 and 1400. Having to queue for too long may put people off waiting, which inevitably impacts profits, so using data to determine when a regular customer comes to you and attempt to change their behavior can help your business significantly
By offering a discount to come to your store before or after the expected lunch rush, you can incentivize people to miss the queue, creating a better workflow for your staff and ultimately improving the service you provide during your busiest period. The customer benefits by getting their lunch for less with an offer that can be sent directly to their mobile phone. It is a win-win.
Best and worst-performing stores
Retail chains are very aware that some stores have stellar performance while others will just drag down the profitability of the company as a whole. But identifying these is not always simple, with legacy systems preventing you from seeing an overall picture.
By having a fully integrated system that amalgamates data across your business’ entire estate, how each store is performing becomes much clearer, allowing the management teams to identify weaknesses at the touch of a button so they can be addressed in the right way.
It could be that providing a discount offer at the right time or creating an event for customers who have not been at that under performing store for more than, say, a month could help to turn around its fortunes.
If your business is a retail franchise, then identifying poor performers could be even more vital so you can address any larger issues with customer service or stock levels that would not otherwise be identifiable.
Product popularity
Crunching data to offer customers what they want is essential and if you can monitor the products being bought in volume, it will not only help keep up with stock levels but also identify market trends that can be maximized to improve profits.
For example, regular analysis of product sales means you can monitor fashions that will last for a short period of time but need to be maximized while they are appealing. You can then identify when these begin to wane and need to be replaced by something else. Having strong data tools can improve stock levels, reordering and offering any discounts and deals that could provide better returns on top-selling products.
Successful loyalty schemes
Loyalty schemes come in all shapes and sizes, but they all have one thing in common — they incentivize your customers to return to your store on a regular basis, increasing sales for your business.
How your loyalty scheme works will depend on the way you want to incentivize your customers and the kind of benefits you want to offer. In many cases, companies will offer points that can be redeemed in store for a certain amount of money spent. But it may be worth looking at whether you can increase your appeal by working with other retailers where those points can also be exchanged for goods or services.
While working with other retailers may seem counter intuitive, having the option to access a wider loyalty scheme means you can benefit from marketing to customers of other businesses, not just from your own. The wider the loyalty scheme, the greater the potential benefits, and your business data will be kept separate by the payment services provider facilitating this wider loyalty scheme, so there is no need to be concerned about that.
Other loyalty benefits are also possible — buy-one-get-one-free offers, value discounts or entries to VIP events that make your customers feel special. Whatever the choice of loyalty offering, being able to analyze data effectively means you will be able to improve or add to the scheme at appropriate times.
Harnessing the loyalty of customers is a great way to improve profitability and using customer data to the best effect helps you offer the right incentives at the right time to boost your business.
About Chris Kronenthal
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