New research has revealed that retailers and consumers feel very differently about the types of marketing communications brands are disseminating.
Modern marketing strategies are all about personalisation and accurate customer targeting. While this concept is nothing new in the online retail realm, research has revealed a troubling gap between how retailers think they’re performing and how they’re actually influencing consumer purchasing habits.
Forrester Consulting, in collaboration with Listrak, has found that 94 percent of retailers feel like they’re hitting the mark in terms of customer-obsessed marketing when in reality, only nine percent are.
According to Forrester, the main concern around this data is that retailers are viewing personalisation as traditional segmentation, which looks largely at single data points like age, gender and purchase history. The flaw with this, however, is that it directs content to consumers based on past needs and isn’t necessarily reflective of current intent.
Surveying consumers in the US who shop online at least once a month, Forrester found that 72 percent of shoppers are more likely to make a purchase with retailers that send relevant communications. A further 70 percent reportedly said that they’re more likely to remain loyal to a brand if they feel like the business understands their needs.
In addition to this, 69 percent of shoppers reportedly agreed they would be willing to share details about their interests and preferences if it meant they would only receive relevant communications, while 67 percent report feeling frustrated when they receive “generic” sales offers/promotions.
“The new imperative for customer obsession is driven by customer expectations for high quality, relevant communications that add value to their daily lives,” Forrester said in the report. “Customer-obsessed companies have the largest median three-year sales growth, higher margin performance, and happier employees.”
Retailers who have succeeded in optimising the purchase journey for their shoppers have reported greater efficiency within their marketing department (63 percent), better innovation (58 percent) and improved customer satisfaction scores (49 percent). Worryingly, however, Forrester says that only 18 percent of the retailers surveyed have seen revenue growth as a result of their personalised marketing strategies.
To see better business outcomes from marketing efforts, Forrester and Listrak claim consumers should move beyond traditional email marketing tools like shopping cart/browse abandonment and transactional messaging, which is used by 70 and 69 percent of retailers respectively. Instead, the firm believes retailers will find more value by tracking key metrics like customer lifetime value, acquisitions, engagement and conversions to optimise their email and digital marketing efforts.