GUEST COMMENT Can UK retailers square up to Amazon?
The UK launch of Amazon’s Dash product was yet another step by the retail behemoth toward domination of the consumer shopping experience. It follows closely on the heels of the roll-out of Amazon Fresh grocery delivery, only moving the company further down the path of retail industry disruption.
It has left many retailers wondering how to keep pace with the ecommerce giant, especially as the holiday season rapidly approaches. Even firmly established players have expressed concerns, with Sainsbury’s CEO Mike Coupe stating, “You can never underestimate a company like Amazon. They have deep pockets and they are very tenacious in making things work.”
For UK retailers looking to square up to Amazon, the power to do so is in their own customer data. A recent Signal survey
of 2,000 UK consumers confirmed that gift-buyers are embracing digital shopping over stores. This trend will only continue, with an increasing preference to shop on mobile devices, especially by Millennials – half of whom prefer laptops and mobile instead of stores. This is all great news for an online retailer like Amazon, but it also presents a huge opportunity for all UK retailers to tap into the power of first-party data that can be collected from all of these touchpoints.
The wealth of knowledge available in customer data gives retailers the edge they need to delight shoppers. By using data to understand better than anyone else what their customers want and need, retailers can deliver data-driven relevance, personalized marketing and authentic, seamless experiences — increasing the chances of making the sale over a competitor.
Here are three ways retailers can leverage their customer data to compete and win against Amazon.1. Know customers better than anyone
Today’s consumers have high expectations that retailers will know and deliver exactly what they want and need, or they’ll go elsewhere. In fact, nearly half of consumers ignore future communications
from companies that send them irrelevant information or product recommendations.
This is where retailers can leverage their first-party data as a strategic weapon. While Amazon is well-known for recommendations, the reality is that retailers with deep customer insights can also deliver relevant suggestions and associated offers. Retailers’ data is oftentimes just as deep or deeper than what the digital giant has access to when considering sources like sales, customer service, loyalty programs, marketing and promotions, and interactions with store associates, as well as pertinent non-customer data such as inventory levels, shipping and supply chain.
When all of this data is collected and connected into a single view of each customer, retailers can understand the full context of who the customer is and her relationship with the brand. Layer on real-time customer recognition, and retailers can understand exactly what the customer is really after at every stage of her journey. For example, the retailer would know whether an item was purchased for the customer or as a gift for someone else, and could target future communications based on that information.2. Deliver seamless experiences
A consistent, positive brand interaction makes it easy for harried holiday shoppers to browse and buy the way they want to, blending the best of both digital and in-store experiences. In fact, while shoppers today often interact digitally, in-store shopping is still popular, as a recent survey found that 34 per cent of UK consumers prefer buying in stores.
The entire shopping experience should be seamless and full of options that bring much-needed convenience to gift-givers’ lives. This is an area where retailers with physical stores have a particularly strong edge over Amazon. By providing customers with flexible purchasing options that complement the online experience, such as “buy online and pick-up in store” or easier in-person returns, retailers can remove friction and create 1:1 experiences.3. Advertise with relevant offers
While ad blocking remains in the headlines, recent research
shows that digital advertising can work well if it is relevant to the customer at an individual level. Nearly 1 in 3 UK consumers would be more inclined to make a mobile purchase if it involved a discount or special offer. The key is ensuring that the offer is personalised to them. So if a consumer starts browsing a retailer’s site for trainers around Black Friday, a well-timed holiday offer on their most-viewed pair can convert an undecided shopper into a satisfied customer – and a completed purchase.
Amazon will undoubtedly continue to innovate within the retail space, fuelled by its deep pockets and vast customer base. But instead of being fearful, retailers should look at how they can leverage the power in their own data to enhance their offerings. Especially in a season when shoppers are looking to quickly and easily check gifts off their list, retailers who deliver customer-first experiences will be those that capture loyalty and share of wallet during the holidays and long after.Neil Joyce is SVP, Americas, UK & EMEA at Signal