a roadmap to retail personalization: how to align marketing strategy and execution
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A Roadmap To Retail Personalization: How To Align Marketing Strategy And Execution sponsored by Manthan Systems #RetailRoadMapTRANSCRIPT
A Roadmap To Retail Personaliza3on
#RetailRoadMap
SPONSORED BY
How To Align Marke=ng Strategy and Execu=on
#RetailRoadMap
Type ques3on here
Welcome Webinar AEendees
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About Retail TouchPoints
ü Launched in 2007
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#RetailRoadMap
Panelists
Debbie Hauss Editor-in-Chief
Retail TouchPoints
MODERATOR
Hillary Ashton VP of Customer Analytics
Manthan Systems
Why Personalize?
86% of consumers — and 96% of retailers — said personalization has at least some impact on the
purchasing decision (Infosys)
The Line Between Personal And Creepy
93% of shoppers are willing to share personal information to receive customized offers. BUT they’re not willing to share everything: 78% are ok with sharing their email address;
64% zip code; 38% birth date and 38% postal address.
Using Personalization To Beat Amazon
Innovation through personalization is key to gaining an edge in today’s competitive marketplace.
Bottom line: at least 31% of consumers want more personalization in their shopping experiences.
Challenge: Personalize Across Channels
40% of consumers buy more from retailers that personalize across all channels (the e-tailing group)
A Roadmap to Retail Personalization
Hillary Ashton
VP Customer Analytics, Manthan
10
Today’s retail pressures
Give me what I want, when I want it, how I want it.
And it better be at a good price.
I’ll engage with you in a race to the bottom. I know I can win.
Profits, profits, profits! Do more with less.
CUSTOMER
COMPETITION
ORGANIZATION
The experts weigh in
The key is segmenting to closely target the demographics making up your future shopper base. By looking at segments on a micro level, you can get to know shoppers on a store-by-store basis and figure out which features you want to prioritize in which locations. Get to know who is in your store aisles and what they want today to shape how you personalize their experiences in the future. PricewaterhouseCoopers LLP “Front of the Line” report.
Retailers now recognize that price and/or product are not enough to differentiate their brand, they need to focus on the customer experience to win.” RSR, Retail Marketing 2013: Organizational Drift report.
[Retailers] are viewing their shoppers’ behaviors broadly: They look at things like spending and purchasing habits, basket composition, purchase timing and frequency, wallet share, marketing effectiveness, and branding impact. Envision your future shoppers by understanding the most minute changes in areas like these, and use that knowledge to model and anticipate future behaviors. PricewaterhouseCoopers LLP 2014 report.
13
Your consumers are ready and waiting
Nearly half of consumers are happy to provide retailers with their personal information as long as it results in a truly personalized offering; and more than 60% would increase their purchases if they were offered a personalized subscription program. Accenture. November 2013 Survey of 15,000 consumers across 20 countries.
As many as 59% of shoppers who have experienced personalization believed it had a noticeable influence on their buying behaviors. Retail Touchpoints. Consistency, Personalization Valued Most Among Consumers.
What is retail personalization?
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KNOW YOUR CUSTOMER
UNDERSTAND THE CONTEXT
DELIVER SOMETHING OF VALUE
TEST + REPEAT
REMINDER: BRAND CONSISTENCY IS ALSO A CRITICAL COMPONENT
For better or worse: a personalization matrix
15
Warm Fuzzies
So Creepy
The Headlines • 6 things online retailers can learn
from Amazon
• How Target figured out a teen girl was pregnant before her father did
• Shutterfly congratulates thousands of women for babies they didn’t have
• Office Max blames data broker for ‘car accident’ letter
Spot On Missed the Mark
Why is it so challenging?
16
While consumers have expressed growing interest in receiving personalized offers, only 8% of retailers rate themselves as being effective at personalization. Gartner. “Predicts 2014: Digitalization in Retail” report.
Over 63% of marketers express a need for better data and better marketing platforms to achieve effective personalization. Neustar. 2014 survey.
DATA must be accurate, timely and
relevant. must incorporate multiple
sources (e.g., channel).
SYSTEMS must support the complete personalization lifecycle.
must consider CRM, loyalty, analytics, campaign
management, real time offers.
EXECUTION must be flawless and aligned
with brand.
Before you get started …
17
Create your strategic roadmap.
What is the business problem?
What is the revenue impact if I solve this problem?
What is a reasonable time-to-value?
Roadmap for Customer Analytics
360 Degree View of Customer • Single customer-centric
view of customer including purchase data, demographic data, preference, contact information and loyalty card data.
Predictive Customer Analytics • Define and understand
customer segments • Predict what customers
will do next including churn risk.
• Understand customer recency, frequency and monetary behavior and other key attributes of individual customers.
Integrated Omnichannel Communication • Select targeted offers
for customers based on customer attributes and predictive analytics.
• Manage customer communications across channels in an integrated and automated manner.
Personalized Customer Offers • Recommendation
engine that evaluates market basket and cohort purchase behavior that identifies other products that are appropriate for an individual customer.
CLOSED LOOP FEEDBACK PROCESS
19 © Copyrights 2014 | Manthan Systems
Analytics and personalization in action Jo
se
• Buys beer & prepackaged meals • Shops lower priced items pays full price • At risk for churn • “Entertainer” segment
Sar
ah
• Shops perimeter • Low frequency, shops 2
times per month • “Convenience” segment H
olly
• Buys wide range of categories
• Lower than average market basket size
• “Secondary Shopper” segment
20 © Copyrights 2014 | Manthan Systems
Analytics and personalization in action
Churn prevention campaign
• 20% churn rate • 1m customers total • Average annual
spend of 3k per year per customer
• Decrease churn by 5%
• $30m in saved revenue
Jose
• Buys beer & prepackaged meals • Shops lower priced items pays full price • At risk for churn • “Entertainer” segment
Sar
ah
• Shops perimeter • Low frequency, shops 2
times per month • “Convenience” segment H
olly
• Buys wide range of categories
• Lower than average market basket size
• “Secondary Shopper” segment
21 © Copyrights 2014 | Manthan Systems
Analytics and personalization in action
Churn prevention campaign
• 20% churn rate • 1m customers total • Average annual
spend of 3k per year per customer
• Decrease churn by 5%
• $30m in saved revenue
• 15% of customers are low frequency
• 1m customers total • Average spend is
$35 per trip • Improve frequency
5% • $2.5m increased
revenue annual
Jose
• Buys beer & prepackaged meals • Shops lower priced items pays full price • At risk for churn • “Entertainer” segment
Sar
ah
• Shops perimeter • Low frequency, shops 2
times per month • “Convenience” segment H
olly
• Buys wide range of categories
• Lower than average market basket size
• “Secondary Shopper” segment
Campaign to increase frequency
22 © Copyrights 2014 | Manthan Systems
Analytics and personalization in action
Churn prevention campaign
• 20% churn rate • 1m customers total • Average annual
spend of 3k per year per customer
• Decrease churn by 5%
• $30m in saved revenue
• 15% of customers are low frequency
• 1m customers total • Average spend is
$35 per trip • Improve frequency
5% • $2.5m increased
revenue annual
Campaign to increase monetary
• 10% of customers have lower market basket size
• 1m customers total • Average spend is
$20 • Improve spend by
20% • $7m increased
annual revenue
Jose
• Buys beer & prepackaged meals • Shops lower priced items pays full price • At risk for churn • “Entertainer” segment
Sar
ah
• Shops perimeter • Low frequency, shops 2
times per month • “Convenience” segment H
olly
• Buys wide range of categories
• Lower than average market basket size
• “Secondary Shopper” segment
Campaign to increase frequency
Churn reduction: 20% Sales lift: 8%
Case Study: Retailer adopts Manthan solution: • Single view of the customer • Behavioral segmentation • Customer behavior
understanding • Customer churn prediction • Affinity-based promotions
execution • Best-in-class marketing reporting
Succeeding with personalization
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#RetailRoadMap
Q & A // Panelists
Debbie Hauss Editor-in-Chief
Retail TouchPoints
MODERATOR
Hillary Ashton VP of Customer Analytics
Manthan Systems
#RetailRoadMap
Thanks For Joining Us!
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