By and large, retailers are aware of this and are taking steps to improve their relationships with customers, both in-store and online. However, there is a paradox at work – whereby retailers’ ability to offer a more seamless shopping experience is improving, but the way that many retailers are communicating with customers beyond the store (physical or otherwise) is no longer up to scratch.
It’s time for the newsletter to be overhauled
Retailers are still sending out generic newsletters to their entire mailing list in the quest for that all-important revenue bump. Personalising a customer’s experience is perceived as technologically challenging in comparison – with huge data sets that can be difficult to unify. When coupled with the short-term revenue benefits as a direct result of the weekly blast email, it can be seen as easier to leave the newsletter system as is.
Given the batch-and-blast mindset behind this short-term approach, it’s not surprising that at Ometria we found 46% of people think that most retailers who email them don’t understand their needs and tastes. Not only are the emails exactly the same for every recipient, a customer may be getting an overload of messages from a single retailer, who may not have a unified customer journey approach that takes into account what the customer has been sent before. Picture the worst salespeople you’ve encountered: they contact you three times without addressing you personally, send aggressive follow ups and then wonder why you ignore them. A customer (also known as a person) is similarly unlikely to welcome this approach.
The reason that some retailers still take this approach is because the effort and bravery involved to change these processes can seem huge. However, the world and the customer has moved on – people’s expectations are far higher now due to the actions of cutting edge retailers in overhauling the way that they communicate with their customers. A comparison can be made here with online banking, which was once seen as a luxury – an amazing piece of fun tech. Skip forward a couple of years, and when TSB’s services broke down, users were outraged even before it came to light that many had actually lost money. Standards change quickly once consumers realise they can (and should) expect more. With players like ASOS starting to make big changes to customer communication, people’s expectations of the way retailers should speak to them have made a huge leap.
The time to change is now
In such a competitive and volatile market, retailers need to stay ahead of the curve when it comes to turning customer data into relevant marketing messages or they risk actively putting off their customers. Our research at Ometria found that 70% of 18-24 years olds – the future of every brand – said that companies who fail to personalise their marketing will lose them as customers. There is therefore a huge business imperative for company practices to change now, rather than waiting for customers to get tired of being over-spammed and sent content that is irrelevant to them.
The problem for many is down to the vast amounts of data retailers store on their customers, often with different sets of data siloed across different types of technologies – with data on returns, buys, browsing and click rates often stored separately across Google Analytics, ecommerce platforms, and more. This makes it hard to identify, for example, a normally regular and engaged customer that hasn’t returned in a while. Unifying data in a usable way, then analysing that data to produce insights, and finally actioning those insights is a simple-sounding process that can seem like a huge mountain to climb for retailers.
This is why the change needs to start now, before the problem gets even more urgent. There’s huge benefit in being a pioneer: personalised communication may be a bit of a buzzword, but it works. We teamed up with personalised children’s book company Wonderbly for the launch of its ‘Birthday Thief’ campaign. For this, a tailored character created for a child in a previous book came back to the gifter in an email to remind them of their last magical adventure, and to show what their next birthday gift could look like. RPM (revenue per 1000 customers emailed) soared when compared to their non-personalised campaigns. Generally, the majority of of emails from retailers go unopened as people are overwhelmed by too much contact, and by content that they’re not actually interested in – personalisation is one of the few ways to get noticed.
Confronting the change is not as hard as it seems
Email has always been a major channel for retailers, and will continue to be for the foreseeable future – customers want to hear from retailers through email, as part of a diverse range of channels. In fact, 67% of consumers cite email as their favourite channel to be contacted by brands. The problem with the current approach to the newsletter, however, is that customer expectations are rising, which inevitably means the batch and blast approach of generic content is dying. The strategy ultimately damages the brand long-term – something that can be hard to acknowledge in the face of the small weekly sales boosts it generates.
But it’s not all bad news. Retailers don’t need to lose the newsletter altogether. Yes, in the not so distant future we envisage fully optimised dynamic campaigns going to each individual, but the focus for now should be more on making newsletter content more personalised. Tailored offers that consider a customer’s past purchases, messages that tell a lapsed customer that they are missed, or an email showcasing products that match the customer’s style preferences, all work to create a lasting relationship and, ultimately, brand loyalty from the individual. These are not resource heavy tasks – in fact, they can be achieved easily and at a low cost, but still yield fantastic results for both revenue and customer relationships.
Placing value on long-term results should be the priority for both sales and marketing departments so any content must be tailored to the recipient as much as technology and data can allow. This requires a little patience and a lot of bravery in a market that still just about accepts generic newsletters, but shifting strategy now is the crucial factor to future success.
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