What CXM Looks Like for Retail Brands
Shopper expectations are high – and that’s putting it mildly. An overwhelming majority of consumers say they don’t just want, they expect personalized service, and they’re more likely to buy from a retailer that recognizes them by name and recommends options based on their past purchases.
It’s a clear departure from the days of “simple” personalization – when an email for baby products landed in a mom’s inbox or holiday gift offers followed customers around the Internet. In today’s always-on, always-cross-channel retail landscape, retailers need to harness the power of customer experience management (CXM) to drive shopper engagement — and conversions.
CXM focuses on the end-to-end experiences for every customer across every channel. In retail, CXM specifically involves tracking customer behavior, organizing customer data, and using these insights to fuel and personalize the customer journey. This process enables brands to deliver highly targeted content that speaks to each shopper’s needs and priorities — think seamless in-store experiences based on past e-commerce patterns or “chatting” with a virtual associate, for a brick-and-mortar-style moment from your living room.
The most successful retailers have to set themselves up to not only meet customer demands today, but to be agile enough to anticipate and meet tomorrow’s demands. These are the retailers nailing buy online/pick up in-store offerings now, while preparing for grab-and-go with smartphone checkouts. They’re the stores staying on top of mobile shoppers comparing prices in-store, while testing AR in those same stores. With each in-store touch, they’re watching customers engage human sales associates while experimenting with voice for e-commerce customers. And they’re better understanding the fitting room experience while tapping into virtual try-on tools. As other new technology enters our view, they’ll be digging into those next big things, too.
While it’s impossible to say exactly where retail is heading, one thing is clear: the future is going to be focused on a whole new level of personalization. The first step in keeping up with this shift is for retailers to cultivate a truly customer-centric culture. The goal is to put the customer at the center of every business decision. And when they’re making purchasing decisions, they’ll be likely to return the favor.
How to get your CXM house in order
Retailers that establish solid CXM are the brands that can and will create these types of epic experiences — experiences that not only drive customers to buy, but that drive them to come back and to bring a friend…or two. These experiences mean understanding past purchases, knowing which channels customers prefer for browsing and researching versus actual purchasing, when they like to shop, what promotions they take advantage of, and more.
There’s no one-size-fits-all when it comes to retail CXM — no one type of experience or one turnkey strategy for engaging and activating customers. The trick is to get all key components of CXM — data, content, and delivery — working in lock step. Do this and you’ll be well-positioned to create, manage, and deliver personalized content in a frictionless environment. Here’s how:
#1. Make sense of your data
Meeting customers’ experience expectations starts with bringing data together across touchpoints, then using it to create the right level of personalization. Customer Data Platforms (CDPs) and Data Management Platforms (DMPs) both play a role in helping retailers gather and manage customer data.
It’s important to understand these options and determine which makes sense for your brand. It’s essential to assess your current martech stack plus where your data is coming from and what your CXM strategy is in the short- and long-term.
It’s also important to understand the qualities of both platforms. DMPs have a longer history and are most commonly used as an advertising platform. These systems enable marketers to leverage third party data to effectively and efficiently target advertising.
On the flip side, CDPs are more robust, covering the entire marketing spectrum and offering access to complete, real-time customer profiles. These profiles help brands identify a potential buyer as well as where they are in their journey so they can deliver relevant, contextual experiences. Most importantly, CDPs use all data about known and anonymous individuals in addition to the store’s personally identifiable information. And, because they retain data for longer periods than DMPs, CDPs are better positioned to analyze customers over their lifecycle
And let’s not forget about the importance of bringing together online and offline data. Both data sets can inform and give insight into each other. Especially in retail, the crossover between the online shopping and the in-store shopping experience is fluid.
For example, a department store customer may receive a promotion online, then come into the store to browse inventory and try on products. But when they see that the item they want isn’t available in-store, they hop onto the store’s app and purchase it before they reach the parking lot. With only one side of the data, retailers miss the bigger picture of the customer journey.
#2. Create consistent, cohesive content
With the explosion of channels and devices used by shoppers, creating, managing and delivering the right content is becoming more challenging. Retailers need a strong digital asset management (DAM) system — a single-source repository for all assets that go into creating dynamic experiences regardless of device. It’s also a big plus when this platform is integrated with your CMS to facilitate adapting assets and resources based on customer interactions and desired channels — mobile, desktop, and wearables, for example.
In our increasingly digital world, content can be a driving force that leads customers from contact to purchase. Retailers like Target and Sephora use their blogs to establish themselves as thought leaders in the world of style. By offering customers insights into areas like trends, the latest fashion designs, and educational content for dressing and applying makeup, they help customers feel connected to the brand and guide them to specific products for purchase.
#3. Make sure you’re delivering — on every platform and on your personalization promise
It’s essential to deliver on the core promise of personalization — to get the right message to the right customer at the right time on the right platform, all with speed and agility.
Retail giant Amazon is the perfect example. Even with a massive inventory and a variety of membership options for millions of shoppers worldwide, Amazon is still able to deliver a personalized experience. At log in, each customer is brought to a personalized homepage developed using data from past shopping habits, the customer’s wish list, and, of course, the shopping cart. This personalization carries throughout the shopping process. As customers search for specific products, Amazon recognizes the search and suggests other products “Frequently Bought Together” for the user to browse.
Delivery spans a host of solutions, from programmatic media planning and buying, to automated targeting engines that use behavioral data and algorithmic models, to campaign management that gets the message into the customers’ hands. Deployment should feed back into the data side to provide even more information about how customers want to interact.
Overcoming retail roadblocks
Getting to this stage can be a challenge. Some retailers do a great job with personalization and content, but they’re not consistent across channels and devices. Others have a consistent look and feel across channels and devices, but they’re not using their data in the right way to get the messaging right.
It’s also essential to focus on data and privacy best practices — not only is customer trust essential to long-term loyalty, there are regulations in place to govern what information you can collect and how you can use it to target customers. Violate those and your customer journeys could be over before they even start.
Ideally, have your own internal best practices in place that are in sync with these structured governance practices. This will give you a playbook for how your team can and should engage customers, from data collection to targeting to future personalization.
Shifting to a CXM approach — and mindset
Though getting started, scaling, and overcoming these hurdles can be challenging, when the pieces come together, the business impact is undeniable.
Last year, Forrester measured the business impact of investing in customer experience and found experience-driven retailers perform better across the board with higher revenue growth, higher customer satisfaction and higher employee satisfaction. In fact, they’re 1.6x more likely to see increased customer advocacy and 1.8x more likely to be leaders in brand equity metrics.
That said, retailers will need to continue to evolve their CXM approach to stay ahead of the curve — and the competition. The most successful retailers are delivering seamless, frictionless, personalized, and highly relevant customer experiences at scale. They’re also laser focused on building long term relationships with customers through meaningful journeys.