Embracing Analytics To Boost Profits And Loyalty
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  • 1. Embracing  Analy.cs  To  Boost  Profits  And  Loyalty  Presented by Session sponsored by
  • 2. #CCSeries13About  CCS  2013  ü 9 Webinars, 4 Daysü Sessions covering Mobile,Social, Store Ops,X-Channel, and moreü Featuring industryanalysts and consultantsü Free for Retail executiveswww.retailtouchpoints.com/connected-consumer-2013
  • 3. #CCSeries13Follow  The  Webcast  On  Twi:er  #CCSeries13  @ConnectConsumer  @RTouchPoints  
  • 4. #CCSeries13About  Retail  TouchPoints  ü Launched in 2007ü More than 25,000 subscribersü Provide executives with relevant,insightful contentü Free Resources such as White Papers,E-book, Webinars, Research andPodcastswww.RetailTouchPoints.com
  • 5. #CCSeries13BrightTALK  
  • 6. #CCSeries13Today’s  Panelists  Pam GoodfellowConsumer Insights DirectorProsper Insights & AnalyticsDebbie HaussEditor-in-ChiefRetail TouchPointsMODERATORMarc SchroederVP, Industry MarketingTeradata
  • 7. © 2013, Prosper®Consumers’ New Normal5 Ways to Identify Modern ShoppersMay 21, 2013
  • 8. © 2013, Prosper®Disclaimer: Prosper Business Development and its affiliated companies (“Prosper”) make no warranties, either expressed or implied, concerning: data gathered or obtained from any source; the presentor future methodology employed in producing the statistics; or the data and estimates represent only the opinion of Prosper and reliance thereon and use thereof shall be at the user’s own risk.1 Confidence in the Economy is Unsteady2 Pragmatic Purchasing Plans Continue3 Spending at the Expense of Saving4 Modern Shoppers Value…Well, Value5 Looking for a Showroomer? Look in the Mirror5 Ways to Identify Modern Shoppers
  • 9. © 2013, Prosper®Confidence in the Economy is Unsteady125%27%29%31%33%35%37%39%41%Very Confident / Confident in Chances for Strong Economy [adults 18+]economic sentiment is volatilethose very confident/confident in chances for a strongeconomy climbed to 40.1% in April 2013no consecutive months of increase since Q3 2012evidence of fiscal cliff, payroll tax hikes, sequester taking tollon consumer psycheSource: Monthly Consumer Survey…yet the stock market is bullish:one out of three Americans judges the health of the U.S.economy by the performance of the stock market
  • 10. © 2013, Prosper®U.S. Unemployment Rate / Labor Force Participation RateSource: U.S. Department of Labor: Bureau of Labor StatisticsConfidence in the Economy is Unsteady1employmentfewer counted as “unemployed” as an increasing number of consumers become discouraged / drop out of thelabor force – driving this percentage downofficial U.S. unemployment rate is in decline, yet the labor force participation rate is shrinking as well0.02.04.06.08.010.012.061.562.062.563.063.564.064.565.065.566.066.5Civilian Labor Force Participation Rate Civilian Unemployment RateLaborForceParticipationRate(%)CivilianUnemploymentRate(%)
  • 11. © 2013, Prosper®2 Pragmatic Purchasing Plans ContinueIn the last six months, have you made any of the following changes? [adults 18+]30%35%40%45%50%55%60%65%Apr-07JulOctJanApr-08JulOctJanApr-09JulOctJanApr-10JulOctJanApr-11JulOctJanApr-12JulOctJanApr-13I have become more practical and realistic in my purchasesI focus more on what I NEED rather than what I WANT3 month moving averageSource: Monthly Consumer Surveyconsumer spendingwhile practical spending and focus on needs peakedduring the recession, consumers still haven’treverted to their old habitsas of April 2013, more than half (53.4%) still focusmore on what they need rather than what I wantwhen at the store, while nearly as many (48.1%) citepragmatic purchase plans
  • 12. © 2013, Prosper®3 Spending at the Expense of SavingReal Personal Consumption ExpendituresSource: U.S. Department of Commerce: Bureau of Economic AnalysisPersonal Saving Rate860088009000920094009600980010000Apr-07Sep-07Feb-08Jul-08Dec-08May-09Oct-09Mar-10Aug-10Jan-11Jun-11Nov-11Apr-12Sep-12Feb-13BillionsofChained2005Dollars0.01.02.03.04.05.06.07.08.09.0Apr-07Sep-07Feb-08Jul-08Dec-08May-09Oct-09Mar-10Aug-10Jan-11Jun-11Nov-11Apr-12Sep-12Feb-13Percentspending / savinghow precarious is this balance for the stability/growth of our economy?real personal consumption is increasing while 2013 personal saving rate levels have dropped to lows not seensince before the Great Recession
  • 13. © 2013, Prosper®390 Day Retail Outlook Score [adults 18+]Source: Monthly Consumer Survey, Bureau of Labor Statistics, U.S. Census Bureaufuture spendinglooking into Q2 2013, the Retail Outlook Score indicatesthat the average direction of seasonally adjusted retailsales (excluding automobile dealers and gas stations)will generally trend upwardSpending at the Expense of Savingspending will likely be driven among upper income,luxury shoppers who generally spend on a higher level,have a more solid financial footing, and aren’t as likely tobe affected by fluctuating fuel expenses, rising foodprices, etc.
  • 14. © 2013, Prosper®Modern Shoppers Value…Well, Value10%14%18%22%26%30%34%38%Jul-06Dec-06May-07Oct-07Mar-08Aug-08Jan-09Jun-09Nov-09Apr-10Sep-10Feb-11Jul-11Dec-11May-12Oct-12Mar-13Department Store Discount StoreSpecialty Apparel Store Linear (Department Store)Linear (Discount Store)3 month moving averageStore Format Shopped Most Often for Women’s Apparel [adults 18+]highlight: women’s apparelfor women’s apparel, department stores have beentrending upward with shoppers, while discounters haverelatively flatlinedwhile price is still an critical motivating factor, departmentstore shoppers more value-driven, placing highimportance on quality, selection, brands available…as well as special sales and couponsdepartment store growth has largely been fueled byincreasing loyalty toward Kohl’s and Macy’s – whileWalmart has been flaggingSource: Monthly Consumer Survey4
  • 15. © 2013, Prosper®Looking for a Showroomer? Look in the MirrorRegularly / Occasionally Use Smartphone to Comparison Shop[among those who own a smartphone]20%30%40%50%60%70%80%90%Adults 18+ Millennials Gen X Boomers Silentshowroomingshowrooming isn’t just a trend, it’s a full-fledged smartshopping strategywhile Millennials and Gen X-ers are the most likely tocomparison shop via their smartphones, this activity hasjumped 50% in the past two years among members ofthe Silent generationMillennials = born 1983 – 1995 Gen X = born 1965 – 1982Boomers = born 1946 – 1964 Silent = born pre-1946 Source: Monthly Consumer Survey5
  • 16. © 2013, Prosper®Looking for a Showroomer? Look in the MirrorRegularly / Occasionally Use Amazon’s Price Check App While Shopping[among those who own a smartphone]the Amazon influenceas of April 2013, nearly half of Millennials regularly /occasionally use Amazon’s Price Check app whileshoppingwhile Boomers and Silents are the least likely to be usingthe Price Check app, usage may rise as an increasingnumber of consumers opt for smartphones over featurephones – and adopt this smart shopping strategyMillennials = born 1983 – 1995 Gen X = born 1965 – 1982Boomers = born 1946 – 1964 Silent = born pre-1946 Source: Monthly Consumer Survey0%5%10%15%20%25%30%35%40%45%50%Adults 18+ Millennials Gen X Boomers Silent5as consumers become increasing connected, the linesbetween in-store, online, and mobile retailing begin toblurretailers focused on a seamless, omnichannel strategywill be best positioned to speak to and perhaps capturetoday’s flitting consumers
  • 17. © 2013, Prosper®1 The economy remains a big question mark for consumers – with uncertainty likelyleading to hesitant spending, worry about employment, and financial well-being.2 While practical spending and focus on needs peaked during the recession, consumersare still trying to maintain guarded spending.3 Personal consumption expenditures are increasing, perhaps at the expense of savings.Luxury shoppers are likely driving the increase in spending.4 Department store shopping is on the rise, appealing to consumers’ value-driven needs.5As consumers become increasingly connected, retailers focused on a seamless,omnichannel strategy will be best positioned to speak to and perhaps capture today’sflitting consumers.Key Takeaways
  • 18. CUSTOMER CENTRICITYTHROUGH DATA DRIVENMARKETINGMarc Schroeder, Teradata Applications, VP Industry Marketing
  • 19. 19 5/20/13 Teradata ConfidentialIncreased Strategies Around Customer FacingMobility and Social Marketing•  Accounts for up to 9% of Retail Sales•  By 2014 Almost Every Mobile Phone will be a Smart Phone•  Influences about 50% of Store SalesRetail Trends19
  • 20. 20 5/20/13 Teradata ConfidentialIncreased Strategies Around Customer Facing Mobilityand Social Marketing•  Accounts for up to 9% of Retail Sales•  By 2014 Almost Every Mobile Phone will be a Smart Phone•  Influences about 50% of Store SalesConsumers Control Their Experience•  Flexibility, Transparency, Relevancy and ConvenienceRetail Trends20emailDirect MailIn-StoreMobileSMS OffersWebSocial
  • 21. 21 5/20/13 Teradata ConfidentialIncreased Strategies Around Customer Facing Mobilityand Social Marketing•  Accounts for up to 9% of Retail Sales•  By 2014 Almost Every Mobile Phone will be a Smart Phone•  Influences about 50% of Store SalesConsumers Control Their Experience•  Flexibility, Transparency, Relevancy and ConvenienceRetail Trends21Impacts of Showrooming•  According to recent research 1/3 of customers purchasefrom a competitor after researching prices online at thestore
  • 22. 22 5/20/13 Teradata ConfidentialIncreased Strategies Around Customer Facing Mobilityand Social Marketing•  Accounts for up to 9% of Retail Sales•  By 2014 almost every mobile phone will be a smart phone•  Influences about 50% of Store SalesConsumers Control Their Experience•  Flexibility, Transparency, Relevancy and ConvenienceRetail Trends22Impacts of Showrooming•  According to recent research 1/3 of customers purchasefrom a competitor after researching prices online at thestoreShowrooming Impacts all Retail Segments
  • 23. 23 5/20/13 Teradata ConfidentialStrategies that Retailers a putting in place to counter the actof showroomingIs Showrooming a Threat to Retailers•  Price Matching•  Not Sustainable•  Specially Featured WhiteLabeled Products•  Product Centric vs.Customer Centric•  Products only unique fora small amount of time
  • 24. 24 5/20/13 Teradata ConfidentialSo if not price matching then what…Retailers need to develop a multi-prong approach that focuses oncustomer centricity•  Use price matching sparingly
  • 25. 25 5/20/13 Teradata ConfidentialSo if not price matching then what…Retailers need to develop a multi-prong approach that focuses oncustomer centricity•  Empower their Associateswith Data and Offers to beUsed for each UniqueCustomer•  Use price matching sparingly
  • 26. 26 5/20/13 Teradata ConfidentialSo if Not Price Matching Then What…Retailers Need to Develop a Multi-prong Approach that Focuses onCustomer Centricity•  Empower their Associates withData and Offers to be Used foreach Unique Customer•  Extended Warranties•  Use Price Matching Sparingly
  • 27. 27 5/20/13 Teradata ConfidentialSo if not price matching then what…Retailers need to develop a multi-prong approach that focuses oncustomer centricity•  Empower their Associates withData and Offers to be Used foreach Unique Customer•  Extended Warranties•  Loyalty/Reward Points•  Use price matching sparingly
  • 28. 28 5/20/13 Teradata ConfidentialSo if not price matching then what…Retailers need to develop a multi-prong approach that focuses oncustomer centricity•  Empower their Associates withData and Offers to be Used foreach Unique Customer•  Extended Warranties•  Loyalty/Reward Points•  Enhanced Convenience/Service•  Use price matching sparingly
  • 29. 29 5/20/13 Teradata ConfidentialMore Efficient & Effective Marketing•  Creates Relationships•  Drives loyalty & satisfaction•  Saves on agency costs•  Lets the marketer focus on creative,messaging, offers•  Increases average purchase price•  Store/product/brand recommendationsBetter Customer Experience•  Channel preference/convenience•  Ability to easily find Product/brandinformation•  Relevant & timely promotionalincentives•  Highly personalized communicationsdelivered more frequentlyProduct Info IncentivesCategory/Brand InterestCustomer CentricityEngagementChannels
  • 30. 30 5/20/13 Teradata ConfidentialMarketers Face Big Challenges:•  Leveraging Data Across the Organization•  37.5% of retail marketers agree that silos within Marketingprevent them from having a holistic view of a campaignacross channels•  Integrating the Digital and Physical Worlds•  Only 25% of retailers create a single view of all customeractions (purchases, call center interactions, web history,etc.)•  Optimizing the Customer Experience•  Only 22.5% of retailers routinely use Data DrivenMarketing strategies to customize marketing messages andoffers to improve customer experience•  Analyzing marketing Initiative Effectiveness AcrossChannels•  58% of retailers claim the top obstacle preventing retailmarketing organizations from applying data to make moreinformed decisions is their existing technology isinadequate, outdatedRetail Marketers are Faced with Challenges in Deliveringa Customer Centric Experience
  • 31. 31 5/20/13 Teradata ConfidentialCustomersCustomerInteractionManagementMarketingAnalyticsMarketingOperationsMarketingOperationsCustomerEngagementReal-timeInteractionsKey Questions from Retail MarketersWhatcustomersmatchcertain socialbehavior?What messageshould I sendnext?Where is thecustomerengaging withme?What has thecustomerpurchased?How do Iattribute valueto thechannels?What haveI learnedabout mycustomers?How should Irespond to thecustomer?Where should Ispend mymarketingdollars?
  • 32. 32 5/20/13 Teradata ConfidentialData Driven Marketing Drives Customer Centricity•  Analyze Customer Interactions•  Discover Customer Behaviors•  Visualize Social Relationships•  Deliver Relevant, Targeted Messages•  Track Customer Response•  Ensure Governance and Compliance•  Connect Data Across the Enterprise•  Understand Customer Behavior•  Deliver Self-Service Analytics in Minutes•  Optimize Spend Across Channels•  Enable the Next Best Action•  Streamline Campaign Execution
  • 33. 33 5/20/13 Teradata ConfidentialKey Marketing Business Challenges•  Need to drive consistent messages across multiple channels•  Want to adjust marketing spend based on performance•  Need to gain insight to understand the right message tocommunicateEngage the Customerwith RelevantMessages•  Desire to evaluate past behaviors to understand how to best engagethe customer•  Need to empower marketers to engage customers with relevant data•  Want to make social connections and understand the relationshipsGain MeaningfulCustomer InsightsDevelop a FullPerspective of theCustomer•  Desire to leverage all enterprise data to drive decisions•  Need to make decisions based on data; not gut feel•  Want to have a complete view of the customer, regardless ofchannel usedIntegrate & UnderstandAnalyze & DiscoverAct & Optimize
  • 34. 34 5/20/13 Teradata ConfidentialIntegrate & Understand Customer Success•  To grow, DSW knew itneeded to increase itrewards programmembers, who tend topurchase more•  Needed informationfrom all channels tobuild right incentive todrive behavior•  Data infrastructurewas unable to connectcustomer experiencefrom both in store andonline•  Teradata IntegratedData Warehouseallows capture ofcustomer input fromall channels•  Robust system canquickly scale tosupport the 18 millionDSW Rewardsprogram members•  Front-line employeesare now using data todifferentiate DSWfrom the competitionDSW has:•  Increased loyaltyprogram customers•  Increased averagemarket basket size•  Delivered moretargeted marketing,driving customers toappropriate channel•  Climbed to thenumber 2 spot inmarket shareDSW is a leading US shoe retailer, with goal of being America’sfavorite place for shoes. Connecting with customers is how DSWpropelled itself into the number 2 position in market share.Challenge Solution Results
  • 35. 35 5/20/13 Teradata ConfidentialAnalyze & Discover Customer Success•  Preserve a loyal basewhile building the eBookbusiness•  Create a multi-channelbehavioral view to drivesegmentation & targetingstrategies as well asmarketing spend•  Incorporate data fromdigital devices like theNook, website, contactcenter, in-store kiosks &in-store point of sales.•  Behavioral Analysis ofPaths to Purchase:Teradata AsterMapReduce Platform joinscustomer data andanalyzes multi-channelpaths to purchase•  Organic & PlannedTouch MarketingAttribution: Goesbeyond single-touchinsight to provideguidance to marketers“The multi-channel, multi-touch marketingoptimization insights thatthe Teradata Aster platformprovides have been criticalto transforming ourcompany.”-  Mark Parrish VP ofRetention and Loyalty.•  Reduce churn: analyticsfrom 5-6 hours previouslyto now 20 minutes•  Increase conversions fromrecommendationsBarnes and Noble was a leading retailer of physical books, video,music and more. Over the past few years, Barnes and Noble hasshifted from a physical seller of books to a digital technologycompany with eReaders with the Teradata Aster MapReducePlatformChallenge Solution Results
  • 36. 36 5/20/13 Teradata ConfidentialAct & Optimize Customer Success• Needed a solution toassist in the kick-off oftheir Customer CentricMarketing program• Wanted to re-launch theBuzz Club Rewardscustomer loyaltyprogram in all of BigLots’ stores• Required an integratedmarketing solution tocarry these outChallenge Solution ResultsDue to instrumental new and revised marketing initiatives,Big Lots was in need of a technology refresh to help themsucceed in bringing these programs and plans to fruitionwhile ensuring their effectiveness.• Using TeradataCampaign ManagementBig Lots segmentedcustomers better toallow for bettermessages and offers• Using Email Marketing,Big Lots created morepersonalized e-dialogues for moreeffectivecommunications• Using CampaignManagement, Big Lotscollected, maintained,evaluated and analyzedbuying patterns ofcustomers• Reduced costs byphasing out preprintdistribution• Realized revenue liftfrom existing customers• Increased averagemarket basket size• Performed RFM analysisto determine howrecently a customer haspurchased, how oftenthey purchase and howmuch the customerspends• Retained members ofthe Buzz Club Rewardsprogram
  • 37. 37 5/20/13 Teradata ConfidentialTechnology-Enabled Customer CentricityWorkflow& RulesPlan &SpendAssets &OffersSource DataProduct/SKUInventorySales/POS/FranchiseSupplierPromotional/Loyalty DataStrategic Insight andMarketing ProcessesSeamless CustomerEngagement / ExperienceCallCenterATM/KioskEmailMobileChannels CustomersSalesCustomersPartnersSocialMediaWebDigitalMarketingAcquisition/LoyaltyCampaignCustomer360 DataWarehouseMiningModelingReportingTrendingProfilingSegmentingBigDataCustomer-centricData ManagementAssetsMulti-Channel Real TimeMarketing ManagementMarketing OperationsMarketing Analytics
  • 38. 38 5/20/13 Teradata ConfidentialReal-Time DecisionsExperiment & Iterate•  Social Graph•  Multivariate testing•  SegmentationBehaviors•  Path to Purchase•  Attribution•  Sentiment AnalysisResults•  Spend•  Wins•  ROIAll Your AnalysisDigital Execution•  E-mail•  SMS/RSS•  Blogs•  Social Marketing•  Personalization•  Landing Pages•  Multi-channel CampaignsMarketing Management•  Planning•  Dashboards•  WorkflowAll Your InteractionsCloud•  Web•  Mobile•  Social•  eCommerce•  Search•  Mobile•  Ad Placements•  Tags•  Visitor ClickstreamApplications•  POS•  Care•  OSS/BSSDigital Data Management•  Weblog Analysis & ETL•  Web Intelligence Data Model•  WorkloadAll Your Data38Tools to Optimize Performance
  • 39. 39 5/20/13 Teradata Confidential•  Integrate and Understand your Customers>  Pull data across your organization (offline, online, inventory/warehouse, social, call center) into a single platform to create acomprehensive view of your customer and your operations•  Analyze and Discover>  Enable big data analytics to understand what is driving customerbehavior like path to purchase, or causes for abandoning theonline basket as well as what and who influences your customerpurchasing behavior•  Act and Optimize>  Leverage the insights and analytics, empower customer touchpoints including your in-store personnel with the information andability to deliver relevant and specific offers to each consumerIn Summary the Key to Customer Centricity
  • 40. 40 5/20/13 Teradata ConfidentialTHANK YOU
  • 41. #CCSeries13Q&A  
  • 42. #CCSeries13Q&A    //    Panelists  Pam GoodfellowConsumer Insights DirectorProsper Insights & AnalyticsDebbie HaussEditor-in-ChiefRetail TouchPointsMODERATORMarc SchroederVP, Industry MarketingTeradata
  • 43. #CCSeries13Leveraging  The  Power  Of  Data  Today, 2 PM ET / 11 AM PTThank  You    For  Joining  Us  www.retailtouchpoints.com/connected-consumer-2013The next Connected Consumer Series session…