By Ashish Koul, President of Acqueon.
In 2017, UK consumer spending slumped to its lowest level in five years, making the fight for the customer an even more chaotic battle scene.
In this context, retailers need to do something to stand out from the crowd and attract more customers if they are to survive. A customer can move to a competitor's website with the click of a button – that's if you are able to get them onto your website in the first place. In this hyper-competitive world, engaging customers and increasing brand 'stickiness' is vital. This is why personalisation is crucial.
The better a company knows its customers, the more effective this is. For many, the answer lies in data. By understanding customers more intimately, and knowing what they like, retailers can personalise and target messages, and increase engagement. However, this is becoming increasingly difficult, as new laws – such as the EU General Data Protection Regulations (GDPR) – put added restrictions on the use of data. How can ecommerce providers strike the right balance between profitability and profit?
Put the scattergun down
Increasingly, it's not just what your message is, but how you deliver it, that can make the difference. Online behemoths, like Amazon, are changing customer expectations – in fact, Amazon is consistently voted best in the UK for customer satisfaction. To compete, online retailers need to match the ease-of-use offered by the Amazons of the world, while also ensuring they connect with customers in a way that suits them – whether that's via email, Facebook, chatbot, text or phone – retailers have to provide a consistent, omnichannel experience that reaches all audiences.
Customers also expect retailers to manage their experience end-to-end, from sale to delivery. Gone are the days when people would be happy to sit at home all day and wait for a parcel – they want delivery times set and real-time updates, or even to be offered discounts if a delivery is delayed. This lifts the bar once again for etailers looking to provide a compelling customer experience. Using data analytics to transform customer experience management and marketing is therefore a necessity for the modern retailer, helping to drive higher click through rates, reduce abandonment rates, and ultimately increase sales. But there could be an iceberg coming their way.
Getting personal with data
This use of data is becoming increasingly complex with the forthcoming introduction of GDPR, which represents a major evolution in data security and privacy. From an operational perspective, GDPR states any data that specifically relates to a person, ultimately belongs to that person – not the organisation creating, holding or processing it. Ecommerce organisations will have to obtain and record explicit consent for personal data to be held or used, with data collection kept to a minimum and only used in the context agreed with the customer. Customers can also choose which channel they wish to be communicated through and in what context.
And there is a lot at stake. A breach of GDPR can result in fines of up to 20 million Euros or 4 per cent of global turnover, not to mention the reputational damage and operational costs. It is important to note too that a GDPR 'breach' does not have to involve any loss of data, it also covers misuse of data; for instance sending marketing information to an EU citizen that has requested not to receive such correspondence, or sharing data with a third party provider. It's no surprise that eight in ten retailers are worried about GDPR compliance.
An opportunity rather than a threat
Yet, handled right, GDPR can also be seen as an opportunity to increase customer engagement. Automating as much of the customer engagement process as possible will be essential to maintaining compliance and reducing cost and complexity. Using a customer engagement platform can help retailers to control outbound communication and cross-reference that the customer has given explicit consent for their data to be used, as well as identifying what channel they prefer to be contacted over. This means businesses stay within the law, but more importantly it also ensures that customers aren't targeted with irrelevant communications which could put them off the brand.
This isn't just a matter of avoiding being fined, but also to transform the customer experience and increase customer satisfaction. As a result, the customer is more likely to value the communication and will be happier with the offers they are being presented with – helping to build brand loyalty. There is no longer a place for the scattergun approach to outbound communications in an era of personalisation – especially when doing so could result in lost custom and a large fine. Instead, all communications with customers must be relevant as well as served through their preferred channel, resulting in a positive impact on retailers' revenues.