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Why retailers need a single source of truth to stay competitive
Rafael Esberard, VP of sales, North America, VTEX, shares why a 'single source of truth' is critical for attaining the strongest competitive advantage in this new retail landscape.
February 28, 2020 by Rafael Esberard — VP of Sales, VTEX
Retailers are facing bigger challenges than ever before. Consumer shopping habits keep evolving and their expectations keep rising. Merchants who make full use of their customer and product data will have the strongest competitive advantage in this new retail landscape. And the new best practices for data use start with having it all in one place — a single source of truth.
A holistic view of business data can help retailers create the seamless unified commerce experience that consumers now expect. A single view can also help refine personalization for more sales and optimize operations for efficiency. And with all this information consolidated into one system, these improvements are easier to implement and scale as the business grows. Here's a look at how unified data can help retailers in three key areas.
A unified customer experience across all channels
Right now, many retailers provide omnichannel experiences that are meant to be seamless. Unfortunately, those unified commerce experiences often have gaps that frustrate customers. For example, when promotions and cart contents don't persist across channels, customers are likely to try the competitor store for a better unified experience.
As we enter into 2020, consumers are looking for a more seamless transition between channels. Surveys have found that up to 80% of consumers say a company's customer experience is as important as what they sell or the price. Up to fifty-seven percent say they've dropped a company for a competitor that gave them a better experience. Slightly more than half — 51% — said most companies fail to meet their expectations.
Why is creating a seamless unified commerce experience so difficult for many retailers?
It's often because of how each channel evolved independently over time: each with different systems, technology and databases. When those systems don't synchronize data effectively in real time, customers are likely to experience discontinuity and gaps while they shop.
The solution is to bring all the data to be orchestrated into one place, so that it's available in every channel in real time. A single source of truth, with unified data, makes it possible to create experiences that are consistent with each customer's shopping history, location, channels and preferences. That will appeal to a vast majority of consumers, who expect companies to understand their needs and expectations. That can result in more sales and repeat business, and less customer experience breaks, frustrations and attrition.
Improved personalization for stronger customer relationships
Unifying customer data will create a one-stop view of all shopping and browsing activity. Then, marketing messages can factor in the latest activity across all channels and touchpoints.
Accurate and timely personalization is critical for a good shopping experience. It's also the key to building trust with customers and creating marketing messages they'll welcome.
A 2019 Infogroup study found that 90% of US internet users are annoyed by marketing messages that aren't relevant to them. More than 40% would switch to another brand whose messages are better tailored to their interests.
To get the data a company needs to create effective personalized messages, there are two key elements. The first is to explain to customers how their data will be used. Up to sixty percent of consumers say they're not comfortable with how organizations use their personal data, and they're more likely to share it when companies explain how they'll use it.
For example, consider a customer who orders jeans online and returns them in-store a week later due to poor fit. They probably won't want a marketing message about those same jeans in new colors. But they might be very interested in alternative items that other customers like, especially if those options are available in the store where they made the return.
Optimized operations for time and cost savings
When sales, inventory, logistics and fulfillment data are visible in one location, it's easier for retailers to plan their inventory, streamline logistics and enhance order management.
For example, with a single real-time view, it's easier to give customers accurate information about where and how they can get what they want, whether that's in-store pickup, pickup at a third-party location, or home delivery.
Unified data can also help retailers expand their fulfillment options. If a retailer can't offer same-day in-store pickup to online shoppers because of poor visibility into real-time stock levels, unified data can fix that problem.
Unified operations data also gives retailers the metrics they need to become more efficient over time. For example, are product deliveries following the most efficient routes? Can the retailer move unsold products from stores in one region where there's low demand to another where they're in high demand? These opportunities are easier to spot when all the data is collected and analyzed in one place.
It's worth noting that more efficient operations can contribute to a better customer experience, too. More efficient delivery routes translate into faster deliveries. The ability to quickly locate and ship specific items from any store in the chain can build customer satisfaction and loyalty. A single source of truth is the key to achieving improvements in customer experience, personalization and operations. These three areas are critical to staying competitive in a transforming retail landscape in 2020 and ahead.
Rafael Esberard is the VP of sales, North America for VTEX.
About Rafael Esberard
Rafael brings over 20 years of experience in understanding the challenges faced by today's online retailers. With a consultative focus, Rafael works side by side with retailers and industry leaders to leverage the maximum results and growth in the US market through the success of its clients.
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