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How Customer Experience Is Becoming Data-Driven On The High Street

Why it’s not just eCommerce that should pay attention to data

8Jun

In the age of data science, organizations are turning to data analytics to bolster their capabilities in all manner of areas - in particular customer experience. Making customer experience decisions based on gut instinct was never really a good idea. Consumer desires evolve far too quickly for supposed experience around what they want to be worth all that much. And it’s not just eCommerce that is benefiting - all industries can use the kind of personalized customer experience that data analytics enables.

Customer experience is integral to business in the modern world, where recommendations on social media can make or break a company and loyalty is fickle. A recent Forbes Insights report, ‘Data Elevates the Customer Experience: New Ways of Discovering and Applying Customer insights,’ — based on a survey of 357 executives of large organizations - found that the benefits of evolving to data-driven customer experiences (data-driven CX) are many. Respondents cited improved revenue generation and lower cost reduction, as well as accelerated process efficiencies and quality improvements. Essentially, better customer experience means happier customers which means more business.

According to Bruce Rogers, Chief Insights Officer and head of the CMO Practice at Forbes Media, ‘This report underlines the importance of having people and analytics work smoothly to deliver a superior customer experience. Your data must be accessible, and your organization must be aligned to orchestrate the process.’

You’ll likely come across data-driven customer experience almost daily on eCommerce sites, as it powers recommendation engines on Amazon, eBay, Netflix, and Spotify, among others. Enabling personalization online is relatively easy because of the amount of touch points that they can record from customers throughout the journey to purchase. The data that they have available to leverage for insights is huge, and their understanding of what individual customers want is incredibly detailed so long as they’ve eradicated silos and have easy access to clean data and the talent to analyze it. For bricks and mortar organizations, it is clearly more complicated.

Social media can also still be analyzed using text analytics to gauge customer sentiment for brick and mortars, but the key to enabling better customer experience in-store is to incorporate as many technologies as possible to collect data, essentially by re-creating the online shopping experience in-store. US fashion retailer Nordstrom, for example, has spent millions introducing technologies like sensors and Wi-Fi signals into its stores, the company can track customer behaviors such as who visits their stores, where in the store they go, for how long, and so forth. The Nordstrom credit card and reward program are also heavily incentivized to help enable further data collection around purchases histories and habits so that personalized marketing materials can be sent out via email and home addresses collected.

Obviously, using in-store technology often takes a degree of cajoling as people that shop on the high street usually want the human touch from their shopping experience. In order to encourage as many people as possible to use it, the technology needs to be innovative, entertaining, and useful. Things like augmented reality in store can enhance the shopping experience, while providing stores with a raft more touch points to understand customer habits. IKEA introduced augmented reality to their catalogs in 2013, allowing customers to ‘virtually’ place furniture in their houses to see what it looks like. Japanese beauty retailer Shiseido is also doing some exciting things to create digital shopping experiences in their Tokyo stores, with ‘cosmetic mirrors’ offering customers the ability to scan product barcodes and see a virtual image of their faces with the product virtually applied to it.

Companies like Nordstrom and Shiseido are, however, in the minority. Consumers still enjoy shopping on the high street, with the idea of human contact and getting outside still genuine draws. However, if it is to survive it needs to embrace data as much as possible to ensure the best possible customer experience, or it risks becoming entirely irrelevant.  

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