Drive More In-Store Purchases with Customer Analytics

September 28, 2018 Kira Byrne

Far from rendering brick-and-mortar stores obsolete, e-commerce can actually help in-store sales associates drive better results.

Remember 2018? A lot has happened since then, so you can be forgiven for forgetting, but 2018 was an important year for e-commerce: it was the first year in which more Americans preferred to shop online than in brick-and-mortar stores.

Of course, with a year-over-year growth rate of 23%, it was only a matter of time before e-commerce surpassed traditional shopping in popularity — especially since over two-thirds of Millennials prefer shopping online to shopping in stores.

However, it would be premature to close the book on brick-and-mortar stores entirely. Despite e-commerce’s remarkable growth in recent decades, the American public still spends 64% of its shopping budget in stores. From the ability to try on merchandise to the absence of shipping fees and the ease of making returns, shoppers still value many aspects of the in-store retail experience. 

That said, all the headlines, trendlines, LinkedIn posts, and fortune cookies point unambiguously to the same conclusion: the retail landscape is changing. While they still have a role to play, brick-and-mortar stores are slowly transforming from places of purchase to places of discovery. Indeed, a quarter of shoppers admit to having made an online purchase on their mobile device from inside a brick-and-mortar store!

Fortunately, these changes don’t spell doom for the physical spaces in which retailers have invested so much. By letting online trends inform their in-store operations, retailers can deliver comprehensive omnichannel experiences that lead to better — and ultimately more profitable — customer relationships. 

Preparing Store Associates for the New Normal

Offering a buy online/pick up in-store (BOPIS) option is one of the most straightforward ways a retailer can move toward a value-generating omnichannel retail operation. The flexibility afforded by BOPIS is so attractive to consumers that one study predicts that 90 percent of retailers will offer this option by 2021.

Realizing the full potential of BOPIS will require arming sales associates with the tools and insights they need to provide an engaging, highly tailored in-store experience to each and every customer. According to the aforementioned study, retailers are already investing heavily in this pursuit: by 2021, 87% of store associates will have access to mobile POS devices, 86% will have access to mobile computers and scanners, and 85% will have access to tablets.

This hardware makes it possible to deliver a truly customer-centric in-store experience, but only if it provides associates with a way to access what really matters: actionable insights derived from data-driven customer analytics.

The Offline Value of Online Analytics

Imagine this scenario: a customer comes into your store to pick up a pair of jeans she ordered online. In the past, upselling this customer would require either bombarding her with questions to determine her product preferences or simply offering incredibly general suggestions. By placing customer insights directly into the hands of the in-store sales associate, however, you can ensure the customer receives add-on suggestions that are actually relevant to her interests and needs.

How? For one, a customer analytics tool can generate personas that match customers’ general preferences and shopping habits. The retailer can subsequently perform “predictive clustering” to get an idea of the product affinities that customers falling within each persona exhibit. Say our hypothetical customer falls into a persona that gravitates toward outerwear and jewelry in addition to denim. If the sales associate is made aware of these persona-based affinities, they can easily tailor their upselling efforts accordingly.

But more precise upselling is just the tip of the iceberg. Customers generate an immense amount of data when shopping online, even if they don’t actually complete a purchase. Digitally-savvy retailers can collect that data, analyze it, and deliver the resulting insights to store associates’ handheld devices.

An associate who knows a retailer’s customers better than they know themselves can be an invaluable asset on the sales floor, and this begins with bringing online insights offline. For instance, a customer who makes weekly online purchases should be treated like the VIP that they are as soon as they set foot in a brick-and-mortar store, even if the store staff has never seen them in person. This is only possible when a retailer conducts — and shares — customer analytics across multiple retail channels.

Similarly, a customer who is particularly discount-sensitive should be greeted with personalized promotions every time they shop. Again, this is only possible when associates on the floor have access to insights derived from the customer’s entire relationship with the brand.

Preserving Retail’s Human Element

Ultimately, while the direct revenue-driving potential of brick-and-mortar stores is shrinking, stores still represent the ideal environment in which to build, maintain, and expand meaningful relationships with customers. Chatbots and product recommendation algorithms have come a long way in a short period of time, but they can’t fully replicate the experience of working with an attentive human stylist.

To learn more about how the evolution of the retail landscape is not actually indicative of the so-called "retail apocalypse," check out "Why This is the Golden Age of Retail."

 

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