Retailers are optimistic for 2012. Sure, concerns about the economy persist. But most retailers feel they're better positioned to handle these uncertainties, and they're starting to tap into the enormous potential of new digital retail technology. We're entering a new era of innovation and information, and the outlook is bright -for those who recognize the opportunities.
Here's what marketers need to know about the changing face of retail:
1. Consumers are the driving force for growth. New channels, new products, Big Data streaming in 24/7. . . Of course, that's all invigorating. But the real news for 2012 is that successful retailers will be focusing their attention where it has belonged all along: on the consumer. Acquiring new customers is part of that equation, as is building tighter bonds of loyalty with those who already know (and love) your brand. As always, successful marketing depends on building relationships. Now, it's time to step up and be strategic about customer engagement.
2. The omnichannel revolution is underway. Since both consumers and retailers now can interact through a variety of different channels, it's becoming increasingly difficult to determine where e-commerce stops and in-store retailing begins. As technologies get faster, more versatile and cheaper, smart retailers are signing on, recognizing they have plenty to learn about digital marketing from e-commerce sites like Amazon. Remember: Amazon's five-year average return on investment is 17 percent; traditional retailers average less than half that (6.5 percent). What's more, online retailers score 87 points on theAmerican Customer Satisfaction Index -that's 11 points higher than the average for physical discount and department stores.
3. Today's retailers have the tools to become more efficient. Going forward, it won't be enough to know that a certain customer bought a shirt from your store last month or that they "liked" your brand's Facebook page last week. Retail marketers now need to combine and analyze these data points plus others, from a variety of different resources, in real time. Fortunately, technology is here to help. To remain competitive, retailers need to use triggers (QR codes, Microsoft Tags), new data warehouse technologies (marketing analytics, predictive modeling, business intelligence) and integrated marketing management solutions (offer systems, segmentations).
4. Customer engagement must be relevant and real time.Technology enables retailers and brands to present customers with better, more relevant (more "intelligent") offers on a 1:1 basis. We're learning that combining analytics, social media and IMM software creates more impact and a better customer experience overall -because that customer experience is informed by insightful data. By harnessing the power of the socialization of data and intelligent 1:1 marketing, retailers can keep the customer in charge and appeal to them with meaningful offers delivered when they're ready to buy.
5. Brick and mortar stores are evolving into an "online inside" model. Already, research suggests that that digital platforms influence half of all in-store purchases, and no one is predicting that percentage is going anywhere but up. Forward-thinking retailers will seize the opportunities to incorporate digital technology in their stores via mobile devices, interactive displays, entertainment and other innovations to improve the customer experience. Online and off-line are going to start overlapping in new and exciting ways.
When I talk to retailers, we keep circling back to three main points: the consumer, ideas and information. The key to success will be linking and integrating these three. Can it be done? Sure. Will it be a simple process? Not necessarily. But those retail marketers that do will create a unique - and dare I say, "revolutionary" - kind of omnichannel experience that will soon be required to drive in-store revenue.