Capturing customer data is vital, but once you have it, what do you do with it and how can you use it to increase business and add-on sales? Graham Reed, director of Varia Solutions, offers his advice
My take on the world of accessories is very like having a curry. It needn’t be just a curry – it could be a pizza or nice steak down the local pub. Bear with me, I promise this will all make sense.
Any good establishment that has acquired and engaged with a customer has a prime opportunity, while they are in the shop, to cross-sell various items. In the case of my local Indian restaurant, it may be a starter or side dishes to complement your meal.
Unsurprisingly, I would venture that 99 per cent of your sales staff have had it drilled into them to offer soundbars when selling televisions. Or extended warranties on dishwashers and attachments for their new space-age-looking vacuum cleaner.
The difficulty comes, however, after the customer has left the premises, put their nice new product in the back of their car, and driven off.
Let’s suppose that while the customer was in-store, their information was captured. You’re on the first step to re-engagement, which can be further enhanced by encouraging a post-purchase sign-up. For example, an extended warranty with a manufacturer or for a post-purchase review, offering a reward to entice them back in-store.
We now have data on a customer, we know what they have bought, when they bought it, and perhaps we have also taken the time to collect some additional information, such as personal interests related to their purchase.
Recent research has shown that 87 per cent of UK consumers have bought a product online in 2016, which means you have to work even harder to get them back in-store. Data is very much the key to engaging with consumers, and creating loyal relationships, and with 75 per cent of online shoppers aged 18 to 24 preferring to shop online, there’s a big opportunity for change.
Relevancy, personalisation and direct life-stage empathy has been shown to have some the largest conversion rates, given the right style of communications. More than half (54 per cent) of consumers want better incentives and loyalty schemes, 21 per cent want offers tailored to them based on their shopping history, and one third of them want better customer service.
Targeting someone using the right channel, in reference to something they have already purchased, creates an even stronger bond with both the retailer and the brand. Doing this enhances the lifetime value of that individual, who can also move on to become an advocate of your products and business.
This has been proven time and again by new entries into the consumer electronics market, and more seasoned veterans such as Apple. This brand does not compromise on cost, and continues to demonstrate you can make money in this sector.
But everybody needs to be on board to achieve this – retailers and manufacturers need to work together. At ERT’s Turning Point summit, there was more than one shout for manufacturers to help retailers with content and marketing support, to enhance the online and off-line proposition of the products that are sold.
While admirable, I think that is the wrong approach. For me, the challenge, beyond price, is that the industry needs to create a stronger bond with their customers. The industry needs to foster brand advocates that feel loved and cherished by a brand.
Some recent examples include Sonos and Nespresso, which have focused on and understood their customers. They’ve created a model where customers have to keep re-engaging with them, and then use the information they gather to turn that into timely, relevant and interesting communications.
When it comes to accessories, it’s really very simple. You have the data, the only challenge you have is how to segment and profile your data and create a series of personalised messages against promotions or offers that you wish to make for the further purchase of accessories to products you know they already have.
But, I believe this has to be a twin attack. Communications need to be formulated from retailers and manufacturers. Retailers, who want to transact sales, and manufacturers, who want to influence sales.
Manufacturers need to step up to the plate to support retailers in a better way, and assist in driving consumer engagement beyond simply the retail experience.
Those of you who know me, know that this is my single passion within the industry. Data is everything, and for those who have started the journey with me, I can assure you the future is looking bright. Good luck with selling those accessories. Now, where’s my vegetable curry?