Online shoppers have become significantly more discerning than they used to be. The vast number of retailers choosing to sell online has made the competition harsh, and the online buyer has tools to compare them all at the touch of a smartphone screen. Personalised marketing and bringing the personal touch back to the shopping experience have taken the online shopper back to the tailored shopping experience of yesteryear, when an experienced sales person would assist with product choices, all from the comfort of their home or the privacy of an app.

“I don’t want to be sold to when I enter a store. I want to be welcomed”


Angela Ahrendts, Apple Inc.

PERSONALISED MARKETING BRINGS TAILORED SERVICE BACK TO THE CLIENT

Once upon a time the local clothing store would know many of their clients by name and possibly even remember their size, preferred fit, and favourite styles. That personal approach made the customer feel welcomed and their business appreciated; it also made their shopping trip more manageable. Rather than looking through rails and rails of unnecessary items that either don’t fit or don’t suit the individual, the sales staff in the shops were experienced in the field (or at least learning) and had a good understanding of their customers needs and the correlation with the store inventory. Personalised marketing and shopping experience in one well-trained staff-member.

It is not the case now. Many physical stores don’t invest in customer relationships anymore because it isn’t cost-effective. Their sales targets judge retail sales staff. You could argue that excellent personal customer service and increased sales are connected, but they are not directly proportional. However, almost the same level of personalised marketing can be provided by a computer by asking a few specific questions. By asking these few questions before a client begins shopping, they can direct you to the styles and lines that will fit and will comply with your fitting requirements.

What’s in a name?

While addressing a customer by name when they return and log into a website would have seemed like a win in the past, now it’s not enough. It’s all very well remembering the name of a customer, but if you can’t remember any more than that you are failing in your personalised marketing strategy.

GDPR may have put a crimp in the continual search for customer data, but companies are still managing to gain customer approval for keeping their details by incentivising the data collection. Whether that is for the improved shopping experience, loyalty points, or access to premium vouchers and offer codes.

Starting with a name is good practice, but it should not be classed as a win in the personalised marketing stakes. The best customer shopping experience needs to start with a name and improve.

Personalisation requires data

Welcoming a customer back to the retail store is a good start, but remembering some essential details of their preferences is better. It is tough for this to happen in brick and mortar stores now, sales staff compete for targets, and the chances are that people won’t speak to the same staff member twice. However, online retail has the upper hand because the shopping preferences can be saved, the computer only needs to apply buying history and browsing habits to a specific account – an easy task for a computer.

People like tasks being made easier. Given a choice between absolute anonymity and a simpler, more streamlined experience, people with generally choose the simplified experience. Sometimes, just making the shopping experience simpler is enough to make people share their shopping habits, however, creating personalised marketing and pricing structures that reflect the buying habits of your clients, gives customers an even greater incentive to share their data.

While audience segmentation is important when targeting new clients; you don’t have the data for personalisation, it is not the route to take when attempting to reengage existing customers

Personalised marketing feeds personalised pricing strategies

When your data collection has reached a point where you can offer personalised marketing to your returning customers, you should also have a significant amount of buying habit data for each of your demographics and their subsets. Armed with the shopping habit data for your customers you can begin to create a customised pricing strategy for your target demographics.

You can target your marketing in several ways to increase customer loyalty, gather more buying habit data, and reward your returning customers with better prices or improved offers. It is a recognised fact in business that it is significantly more cost-intensive to entice a new shopper than it is to keep an old one, approximately five times more. As a consequence, it is probably better to offer your loyal returning customers a better deal than elsewhere if you want to increase your profit margin.

Once you have the buying habits of your audiences, you can create a pricing structure that rewards loyal and returning customers as well as enticing new additions to your customer base.

Dangers of personalised marketing and pricing

While personalised marketing and the creation of personalised pricing structures are looking to make a significant appearance throughout 2019, it is essential to create these structures with serious consideration. Some dangers present themselves when using particular metrics for segmenting your audience.

One company faced a negative response when they used postcode data to segment their audience and create a more personalised pricing structure. A specific price strategy was applied to a postcode area that had a primarily Asian population. The response was that the pricing structure was considered “racist”. It was not a deliberate attempt at covert racism, merely applying a single metric without considering the broader implications; this can happen when personalisation is confused with audience segmentation.

Another danger of personalised marketing is the filter of information and how the data is used. You may have a spectacular data analysis platform that can filter the customer shopping habits to predict their future needs, but you don’t want to appear stalker-like and creepy. Target, in the US, learned the hard way why being too accurate can be more than ‘unsettling’ to the customer.

The personalisation of the eCommerce landscape via marketing, pricing and shopping experience, is set to be a defining development in 2019. As everyday technology has developed, our expectations have progressed beyond the point of sacrificing personal service in favour of convenience and speed; now we expect both. Retail businesses that can offer personalised marketing, pricing and experience, in real-time, will be the winners in the retail game.