Eight Ways CPG and Retail Companies can Use Customer Data for Better Targeting and Personalization | HCL Technologies

Eight Ways CPG and Retail Companies can Use Customer Data for Better Targeting and Personalization

Eight Ways CPG and Retail Companies can Use Customer Data for Better Targeting and Personalization
January 11, 2017

By promising improved personalization and loyalty benefits in return for shopper data, retail and consumer goods companies can incentivize customers to share valuable information that can be harnessed to refine targeting, thus boosting ROI and brand differentiation

How do I create a niche for my brand in a market saturated with numerous rivals offering similar products and services? How do I differentiate myself amidst aggressive competition from digital natives that deliver a broad range of products, and continuously raise the bar for customer experience? And, how do I register my brand message in the minds of increasingly discerning consumers, who typically get exposed to thousands of advertisements every day?

For retailers and consumer goods companies like yours grappling with these questions, the answer lies in cutting through the information ‘noise’ by dumping non-targeted ads and generic brand experiences for more focused, personalized messaging. Such an approach, if designed and executed well, could enhance buyer engagement, in turn helping you build a larger and more loyal customer base, and generate higher ROI from marketing spends.

All about give and take

  • Majority of consumers have shown willingness to share personal data when there are clearly defined benefits in return
    • Loyalty offers & discounts – 57%
    • Personalized shopping experiences – 53%,
    • Customized product recommendations – 52%
  • Nearly 62% of consumers say it's acceptable for companies to send personalized offers and discounts based on items they've already purchased

Harnessing customer data for personalization

The outcome of any personalization initiative depends on how well you know your target audience, including their buying behavior, preferences and dislikes. However, gathering relevant information from existing and prospective customers is definitely not easy.

For your targeting efforts to yield the desired results, you need to incentivize your customers to share accurate information willingly. This data can then be mined to provide them with a differentiated experience at every stage of the brand experience life cycle.

Implementation roadmap

Here are eight tangible ways in which you can appeal and target your existing and potential customers for capturing valuable information, by enticing them with personalized brand experiences and compelling loyalty benefits:

  1. Personalize emails: Your email newsletters should only contain content that readers are actually interested in. To understand what subscribers like and need, analyze the content they selected during the signup stage, and the sections on your website they frequently visit. Combine this data with their buying patterns and personal preferences to deliver customized emails with personalized content.
  2. Make the most of abandoned carts: Use information concerning abandoned shopping carts and wish-lists to share relevant display ads and follow-up mails regarding items left out by an individual buyer. You could even strengthen your remarketing efforts by tempting customers with attractive discounts and offers.
  3. Tailor buyer content for different purchasing stages: Analyze the type of content that individual visitors are consuming on your website and apps to better understand what stages each of them is in the buying cycle. For instance, if someone has just downloaded a catalog, that visitor is at the top of the marketing funnel. The next step for you then is to send that visitor more information related to that category, for accelerating his progress across the purchase cycle.
  4. Cross-sell and upsell: Leverage recommendation search engines to aggregate products and content based on customers’ transactions and shopping behavior online. Harness the aggregated data to suggest other complementary products to individual customers, thereby driving increased, yet non-intrusive, cross-selling and upselling.
  5. Target through loyalty: Thank your customers with attractive membership rewards in exchange of account signups with personal details. Use this data to offer customized deals and promotions to your loyalty cardholders, based on their purchase history and response to earlier schemes. Allow customers to integrate their loyalty programs with those of their family members. This way, buyers can share reward points, while you will be able to glean compelling insights around their collective buying patterns.
  6. Enable federated account signup: Enable visitors to your digital properties to create user profiles using their social media accounts. Apart from streamlining the signup process, this would also help you generate rich insights from customer conversations online around brand experiences.
  7. Tap into mobile: Personalize your mobile apps and website based on individual user settings, including customer locations. Leverage the full range of functionalities in smartphones, including camera and geolocation, for greater personalization. This will help your app stand out in a crowded marketplace.
  8. Market around life events: Partner with trusted third party information providers to build a dedicated database of your customers’ life events and occasions, which contains updated and relevant information pertaining to your business. Use agile systems, processes and technologies to dynamically track and act on these events in real time. For example, a utility could harness such data to target customers when they move homes, an activity that accounts for 65% of supplier switches.

Personalization in action: Examples

Lancôme’s user account includes a comprehensive beauty profile that asks consumers 22 beauty questions. These queries are designed to collect data on physical characteristics, and also the user’s makeup expertise, beauty routine, and favorite styles. Based on this data, the brand micro segments consumers, and provides hyper-personalized recommendations. All recommended products are curated into a personal shopping list, closing the loop between content and commerce.

Neiman Marcus asks users to share their clothing sizes, and explains that sharing this data will facilitate a sleeker checkout process by auto-filling sizes on product pages. Similarly, Sephora clearly highlights that if consumers submit information concerning physical characteristics and beauty preferences, they will receive personalized product recommendations.

Parting thoughts

By adopting a systematic approach to data collection and deployment, you can scale your personalized marketing efforts across a broader consumer base. The success of such initiatives will hinge significantly on how well you consolidate data across multiple channels, and break data silos through centralization. At the same time, you need to be flexible enough to constantly evaluate your efforts, and course correct as required.

The author can be contacted via soumyajyoti.s@hcl.com