Knowing your customer base is undoubtedly an essential first step in any retail operation. Without a deep and multifaceted understanding of exactly who comprises your audience, what drives their purchasing decisions, and what they’re looking for out of a brand, it can be next to impossible to see long-term and sustainable business growth. However, while much effort is focused—for good reason—on researching this cause, identification is only the first step in a successful (and profitable) customer relationship.
In its 20152 CRM/Unified Commerce Survey, retail consulting firm Boston Retail Partners (BRP) detailed the foundation of a “closed-loop system” that begins with customer identification, then segues seamlessly into customer engagement, analysis, and retention. However, the process is far from linear. Rather than stopping at retention, retailers are urged to perform consistent research into customer understanding and identification, enabling retailers to build upon each relationship by repeating the four steps. In a similar vein, top North American retailers are taking a similar approach to their CRM investments, prioritizing the actions that drive this cycle, and planning ahead to ensure steps are in place to keep it spinning for years to come.
Key ways executives are looking to CRM to help close the loop include:
Identification:
According to the survey, a staggering 883 percent more retailers plan to identify customers when they walk into a store within five years. While this approach brings to mind innovative technology, such as beacons, that utilize geolocation capabilities to push personalized offers and messages to shoppers as they enter a store, it’s important to note that before any of these initiatives can take place, retailers must have a solid knowledgebase of each customer. This is where CRM comes in—Boston Retail Partners describes the first step of any CRM program as “acquiring customers and their information so the dialogue and building of the relationship can begin.”
Simply put, without the rich and detailed customer data provided by and stored within a CRM system, target marketing and similar customer identification tactics are infinitely more difficult to implement, as no real knowledge exists of who is patronizing the store. To this end, investing in a CRM system capable of keeping track of customer demographics, statistics, actions, and updates is essential to this critical first step.
Engagement:
Once they’re hooked, keeping customers excited about your brand can be a challenge. To boost engagement, the BRP survey cites that 74% of retailers indicate that customer experience/engagement is one of their top three CRM priorities. One of the quickest ways they’re looking to get there: suggestive selling. Suggestive selling is a retail tactic in which an associate suggests a supplemental product or service to a client that may suit his or her tastes and needs. In fact, suggestive selling was identified as the top retail executive focus for customer engagement, according to the BRP survey, with 34 percent currently implementing the process, 40 percent planning to implement it within two years, and nine percent planning to implement it in three to five years. Again, without the insights and information provided by CRM, associates can be hard-pressed to match a client to a specific offering. However, when provided with data such as past purchase history, it becomes much easier to create a “profile” of each customer that can be referenced to determine what new items he or she might be interested in trying.
Analysis:
Every client interaction provides an opportunity to understand your key audience more and to uncover new patterns and trends shaping their customer journey. Yet, keeping track of all the incoming data can be difficult—especially as customers become more mobile and omnichannel, interacting with brands across the Internet of Things (IoT) and in turn, generating mass amounts of Big Data in their path. Built-in analytics and dashboard capabilities available in proven CRM systems make it easy to manage, maintain, and maximize these insights, helping companies make more informed business and marketing decisions. In fact, the BRP survey found that 100 percent of retailers plan to utilize analytics and dashboard capabilities to understand customer purchases and shopping behaviors in the next two years.
Retention:
Securing a customer’s business is an important part in securing their loyalty, but it isn’t the only part. Retention is the critical step to building long-term customer relationships. While a top way it can be achieved is through structured loyalty programs, cited by 46 percent of retailers as one of their top three CRM priorities, retention can also be secured by providing top-notch customer service and support. According to the BRP survey, traditional service options are still the chief focus of retailers, with 82 percent utilizing telephone support and 74 percent relying on e-mail support. A proven CRM system supports all of these initiatives, providing the customer history and background data necessary to drive a successful, customized loyalty program, as well as real-time project/purchase status updates and customer profile data that enables support associates to provide direct and tailored support.
In essence, if the customer journey is a circular movement—rotating constantly through every sales pitch, customer purchase, support inquiry, marketing initiative, and more—then CRM is the axis, sustaining the motion, supporting the weight, and spurring the progression—ever forward, ever focused.
Source:
“CRM/Unified Commerce Survey,” Boston Retail Partners, 2015, https://bostonretailpartners.com/2015-crm-survey-report/.
NOTE FROM THE PRESIDENT
