ASK THE EXPERTS
ISASINGLECUSTOMER VIEW WORTH THE TROUBLE?
The single view of customer has long been sold as a universal retail marketing panacea. But e-commerce integration expert Darryl Adie asks whether the benefits are all they should stack up to be
I
f you can capture and combine data about your customers’ interactions with your brand
online and offline then you’ll be able to target your marketing with pinpoint accuracy. On the surface this argument is compelling. Darryl
Adie, managing director of enterprise e-commerce agency Ampersand Commerce, agreed that advances in data collection and analytics have certainly improved e-commerce efficiency. So the same should surely be true for offline analysis if one could collect and analyse the same data about offline interactions, surely? “Combining online and offline data will let you target offers more appropriately, offer discounts with more accuracy and generally understand individual customers more effectively,” he said. But solving the challenge is that it is not that
simple. “For one, creating a single view of customer is an expensive and complex process,” Adie continued. “As well as creating a new instore and online data infrastructure, there are also huge costs involved in integrating this into existing systems, from EPoS [electronic point-of-sale] through to analytics. As well as the cost of the software, hardware and retraining required there will also be the inevitable financial impact of the disruption that any major process and technology change brings about. “In addition, while online data collection is relatively
seamless, established and well developed, instore data capture is still clunky and complex. You can offer loyalty cards but these are limited – people often forget to use them and many customers don’t bother with them at all. You can collect names and addresses instore, either as part of a membership scheme or at the point of purchase, but this is time consuming and adds additional steps to the retail process. You can even use mobile data, whether text, location or NFC [near field communications] based, but these options can be complicated and have privacy issues. “The bottom line is that data collection instore
is always going to be imperfect. At best, you can get an incomplete view of what a person has actually purchased. What you can’t see – which you can
16 Winter 2014
Letting customers personalise their instore experience and offers based on online purchases can help drive footfall from the web to store
online – is what they looked at, what they picked up and put back or what they wanted to purchase but was out of stock. Therefore, if you combine your online and offline data as equally valid sources you’re quickly going to find significant skews in your data that could lead to erroneous marketing conclusions.” He said there are also question marks over the
assumed value of the ability to endlessly target marketing: “Firstly, while segmentation is, without question, a hugely powerful marketing tool, it has a law of diminishing returns. The more granular your segmentation, the harder it is to drive meaningful value from ever smaller segments. Secondly, there is a limited consumer appetite for super-segmentation. We all like receiving information that is relevant to use, but if you cross an unspecified line of precision you can quickly stray from ‘relevant’ into ‘creepy’.” There may be definite costs and limitations to
a single view of the customer, but Adie added there clearly are benefits. “When properly implemented it can enable the sort of segmentation and personalisation that delivers real value to customers – surely every marketer’s dream. “The ability to personalise a customer’s online
experience based on their offline habits can help you to capture the ROPO [research online, purchase offline] customer, while letting customers personalise their instore experience and offers based on online purchases can help drive footfall from the web to the store. Evidence has shown that customers who interact with your brand across more than one channel are more valuable and loyal so, whether you’re able to personalise interactions or not, it’s always important to encourage cross-channel behaviours. “There are clearly benefits to be gained from
having a single view – no-one is debating that. However there are significant costs as well as challenges in securing customer buy-in for instore tracking and acceptance of targeted marketing. The question is a whether the benefits outweigh the inevitable costs, compromises and customer questions that accompany this sort of project,” he concluded.
www.retailtechnology.co.uk
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