Data-rich retailers lack customer identity insight

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Amido, a vendor-agnostic technical consultancy specialising in assembling and integrating proven cloud technologies to improve customer identity and data management, reports that c-suite leaders in retail are struggling to find value in the data they hold about their customers owing to the inadequate integration of their siloed data.

Amido's report highlights the need for retailers to utilise their data more efficiently in the face of stiff competition from rivals, aggregators and disruptive digital market entrants. Admitting that their systems are fundamentally flawed, leaders in the sector agreed that understanding customer identity information is critical in today's evolving digital landscape.

Of all the retailers interviewed by Amido, only one believed it had a single view of the customer. Nevertheless, the research clearly reveals the issues in the way organisations deploy identity management technologies to capture customer identity information – be it through developing a direct-to-customer business model or having to improve information and services to retailers/intermediaries; all agreed that creating the holy grail of a single customer view is of the most importance to business development, customer retention and loyalty.

Retailers understand customer identity, so why aren't they better at it?

Retail, like media, has the greatest understanding of customer identity and the technology leaders interviewed all acknowledge the value of customer identity data in delivering accuracy and precision to marketing. However, as with many other markets, technology investments were not focused on the customer, but rather on business processes the technology supports, such as ERP or CRM, leaving gaps in the customer identity management strategy.

This problem, coupled with the ever-pressing issue of multi-channel delivery that customers have begun to expect, has triggered all leaders to focus on using customer identity data to discover behaviour patterns, which will increasingly dictate the services on offer. Customers demand a harmonised purchase journey across multiple platforms (mobile, in-store, online/social sites) and a multi-channel delivery has a direct impact on the quality of the services provided.

For the case of Everest Home Improvements, IT Director, Adam Haydon, comments on his recent review of the customer purchase journey through to the technology processes, which impacted the customer relationship as it struggled to turn data into insight: '90 per cent of the data we had was really inefficient; so we are now turning that into genuine information and working towards a point where the organisation is no longer asking IT to write a report. It will make everyone's lives easier as we are rich in data and poor in information.'

N Brown, an online catalogue retailer which offers customers an option to buy with credit, is still trying to unlock value in the data they hold, especially since 90 per cent buy items using credit - providing them with a unique insight into how customers purchase. Furthermore, a key part of any online fashion retailer is the returns policy which insists upon a strong customer identity management; so for COO Andy Haywood, 'the big breakthrough will be a single view of the customer and having the data in one place,' he adds.

Alan Walsh, CEO of Amido, comments: 'To maximise the value of customer data, organisations need to integrate their systems in order to get a complete and holistic view of their customers. This builds on the basic customer knowledge to get a deeper understanding. The creation of a single customer view informs decision-making and allows organisations to target more effectively.

It makes marketing activity more focused and increases revenue from existing customers; which products to suggest they buy, what articles they might find interesting. The credit service provided by N Brown places the organisation in a unique position with its customer base as it offers its customers a service that they cannot get from anyone else owing to the insight it gets in terms of understanding the types of product the customer wants and how they choose to buy it.'

It's not just about the CRM system, there's a new breed of marketing in town

Retail marketers know that customers want to receive relevant and timely content consistently across all channels in a way that engages them and matches their interests and buying behaviour. Retail leaders already understand their customers in order to help shape the business with targeted products within the community; but many are still not creating that single customer identity profile, because they lack a joined up approach to disparate data-rich pools across the organisation.

James Libor, Performance Marketing Manager of Virgin Holidays is a new breed of marketer who is au fait with the demands and opportunities that are inherent in big data. By handling all organic search and biddable media for Virgin Holidays, he has been able to collect enough data to put together a single customer view, assembling an almost complete picture of their customers all the way through their journey with Virgin Holidays. But it's not perfect, he admits. 'We are way short of being 100 per cent and there are capability gaps. But that is not unusual. Most big companies suffer from that - unless they are Facebook or Google.'

Alan Walsh, CEO of Amido, agrees with Libor's approach and adds that 'a joined up identity strategy improves customer experience by reducing spam. Personalisation excellence comes when you combine your CRM system with insight gained from multiple data sources (social profiles, email marketing, order or browsing history, customer services, transactional history, cookies, online journey etc.) to offer up products and services that customers want, when they want them and in the right channel.

You can then apply machine learning to predict future behaviour and pre-empt what customers want before they know they want it. One technology product cannot do all this – it needs a combination to build the identity that will underpin personalisation, customer retention and loyalty.'

Maggie Van'T Hoff, CIO of Shell Retail says that developing customer loyalty extends beyond the loyalty card and that 'being able to reach out to your customers and target them with things that are pertinent to them,' is the strategic ambition of her team. 'We want to personalise the brand and the whole customer experience,' she adds.

A few respondents interviewed named Amazon as an excellent benchmark to personalisation and providing that ubiquitous mobility, omni-channel experience. Amazon does offer a good service and can recommend products based on previous purchases, but Alan Walsh, CEO of Amido, comments: 'Amazon's customer identity solution is not where they excel – its purchase recommendation is basic as information on the customers is based on what they previously bought and does not take into account anything else about that individual.

They don't have a social log-in which provides convenience and extra information rich in customer identity nor do they know anything about your behaviour on other websites. Having this insight to complement your existing customer information leads to improved customer services and most importantly, customer interaction with your brand, product and services.'

An example of turning data into insight and engaging consumers is a leading online retailer who needed to better understand its shoppers if they wanted to really improve customer engagement and drive revenue from their existing shoppers. Its challenge was to get a wider perspective and more up-to-date information about their customers and incorporate that into their sales process. The retailer's customer is an active social media millennial-type, and the retailer wanted to bring the social sign-in process to their multi-channel platform in order to streamline registrations and browsing into sales, preventing loss conversions.

This would allow customers who use Facebook, Twitter and Google+ to benefit from a seamless login and social sharing experience across all platforms, and equally importantly, get more up-to-date information about their customers that a more traditional in-house registration platform would not give them. The retailer recognised that using identity technology to help them better understand their customers would help drive revenue.

As experts in identity management and social integration, Amido worked closely with the retailer to find the right identity solution for the business challenge they faced. The solution needed to be quickly incorporated into its existing technology assets. In line with the Amido philosophy to 'deliver more, code less' the chosen SaaS solution combined the consumer management capabilities of a leading SaaS identity platform with the identity features of Microsoft Azure and was seamlessly integrated with the retailer's existing systems.

Since the implementation of the identity service, Amido and the online retailer have continued to work together to solve business problems through the smarter use of technology. As well as designing and delivering a scalable ecommerce system to enable consistent and significant revenue growth, Amido has architected and delivered global recommendations and rewards programmes and is now supporting the online retailer on its next step to implement other cloud services on its core commerce platform, ensuring that the right technology fully supports their global expansion.

The inclusion of social sign on delivered:

  • Instant insight into newly acquired customers
  • Richer information around customer registration
  • An up to date view of each returning customer
  • A single representation of any customer – no matter how they sign in
  • Improved customer engagement through social sharing
  • Better understanding of customer behaviour

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