ANALYTICS
SECTION ONE
SECTION TWO
 |
It's Time to Deal with Big Data
For retail marketers, the new millennium brought with it equal doses of
opportunity and frustration. While neither of those concepts is new to
those in retail, the speed and sheer size of each is unequaled in history.
Mobile was the big focus in 2011. Everyone rushed to get an app
developed and onto as many phones as possible. But the really hard part
was getting people to use the app, and not delete it once the novelty wore
off. QR codeswere the hot thing last year as well, but misuse and lack of strategy have all but killed them off as viable marketing tools. Even college students are bored with QR codes.
This year is a little different. The term “big data” has recently entered the lexicon, and unlike mobile or social media or barcodes, big data isn’t a tactic or some bandwagon ready to be boarded. Big data brings with it changes of epic proportion for the marketing world. The impact will be felt whether marketers choose to engage with it or not, and those who do not will feel the impact in negative ways.
Customer relationship management has been with us for many years, and attempts to execute programs to assist in customer management have mostly been unsuccessful. Loyalty programs, first rolled out in the late 1980s, are a perfect example of tactics in search of a strategy. Many retailers spent tens of millions of dollars launching loyalty card programs with little thought to how the data would be used.
It’s time to dust off those data warehouses and start putting them to good use. The good news is that technology is getting better for analyzing and manipulating big data; the bad news is it won’t be cheap, and finding people who know how to use and respond to the answers is already getting difficult.
A recent New York Times article shone a light on just how much a retailer can learn about its shoppers. Target (the retailer in the article) doesn’t even ask its shoppers to carry a key tag. But the dark side of big data use was made apparent as well: the perceived violation of privacy and the resulting backlash. Despite their willingness to share everything from what they had for breakfast to photos of their son’s birth on Facebook, consumers like to believe that no one is really looking at all that and using it to market to them.
Retail marketing departments can - indeed must - engage with big data, and quickly. This isn’t the latest fad; big data hasn’t even really gotten rolling yet. But the wave is coming, and it’s about to make landfall.
Using big data is more than number crunching. It’s an art that works from a base of science. Experience and a willingness to learn from the insights are critical. Where to start? People first - data people for certain. More important is the need for marketing experts who know which questions to ask and how to understand the answers.
A marketing strategy is the best starting point. Look at the shopper, her needs and challenges. Then look at the competition and where you can offer unique value. Big data will change the game for price-only players; while a few will continue to operate, it’s all about targeting, relevance and engagement now.
A major shift for retail is likely to involve moving from a customer acquisition strategy to one that is more focused on customer satisfaction. This is where big data can really help the marketing team shine as they learn more about existing shoppers and where they are - and aren’t - spending time and money in the store, and work to reinforce or change those habits.
Social media is a big driver of big data, and one that can’t be ignored. Consumers know their activities on Facebook and other social outlets are being tracked, and they expect some level of personalization in return. The challenge is to have enough intelligence to make the offer relevant, but not straying over the line by getting too personal. It’s a moving target that varies by customer and offer (the better the offer, the less likely they are to be concerned about privacy).
One approach is to make the offer look more random than it is, or disguise it within other random offers. This has the benefit of not scaring the customer with too much personal information, while also making them feel as though they’ve found something really good.
The other side of big data that marketers - not to mention CFOs and CEOs - will like is the ability to derive solid success metrics for campaigns to truly understand what worked and what didn’t. Adjustments can be made for the next time, or even on the fly in the middle of a campaign. Ongoing, real-time measurement is a must-have for any campaign, and seat-of-the-pants measurement is a relic of last century, and should be left there.
Implementing big data in a seamless fashion will also require use of many of those tactics that marketers tried and dropped: mobile, social media, email, etc. But rather than singular tactics without a strategy, big data allows these tactics to be connected components of an integrated marketing strategy.
It’s a brave new world for marketing. Like it or not, it’s here to stay. Now is the time to get the talent and the technology - and begin to invest in big data.
This essay was written by Jeff Weidauer, vice president of marketing and strategy for Vestcom International., a Little Rock, Ark.-based provider of integrated shopper marketing solutions. He can be reached at jweidauer@vestcom.com, or visit www.vestcom.com.
Click on the LinkedIn logo to join the new Shopper Technology Institute Discussion Group
SECTION THREE
