Chapter 3: Intelligent Insights Spark Personalized Engagement

A 5 Part Series

The advent of data-driven personalization has led to a revolution in multiple industries. As prevalent as it may be in the world of online retailers and digital shopping, data-driven insights play an equally significant role in the world of physical retail.

As digital technologies evolve and customer data becomes increasingly abundant, survey reports and findings demonstrate how more retailers are harnessing this power to provide a personalized, engaging experience to their shoppers. This approach not only fosters a deeper connection between the retailer and the customer but also helps secure customer loyalty in a fiercely competitive market.

Read on to learn about the growth of intelligent, data-driven insights and how physical retailers are utilizing this to offer more value to consumers and become customer experience leaders.

Shoppers and Retailers Prioritize Personalization

The retail sector acknowledges the significance of personalization, investing significant effort and resources towards it, especially in the past few years. It comes as a natural next step when you consider consumers’ expectations.

With nearly three-quarters of shoppers expecting companies to grasp and meet their unique needs and desires, retailers are prioritizing the customization of customer communications in order to gather necessary data. This understanding proves critical since traditional, one-size-fits-all communications no longer suffice to attract consumer attention.

The Rise of Personalization in Physical Retail

The retail sector has largely acknowledged the significance of personalization, with retailers prioritizing the customization of customer communications. It falls in line with customer expectations, where nearly three-quarters of shoppers anticipate companies to grasp their unique needs and desires.

The Salesforce survey is not the only one to see such statistics. Other reports show that consumers not only expect personalized experiences based on past purchases but also are more likely to shop from retail brands that do so.

This understanding proves critical since traditional, one-size-fits-all communications no longer suffice to attract consumer attention.

Owing to this, an impressive 93% of retailers are investing more in personalization than ever before. This investment reflects a clear shift towards a more personalized approach to shopper engagement within the physical retail industry.

Notably, retailers have made remarkable strides in leveraging customer data for personalization. In the span of merely two years, the percentage of retailers claiming a full capability to use such data to personalize shopper engagement has almost doubled, increasing from 32% in 2021 to 57% in 2023.

These statistics underscore the growing importance of personalization in physical retailing. Retailers are not just acknowledging the power of personalization, they are actively investing in it and making considerable progress, underlining its critical role in the retail industry’s future.

All in One: How Retailers Get Their Data

Retailers today are leveraging advanced tools and technologies to amass customer data. At the forefront of these technologies is the use of unified engagement platforms. These platforms provide comprehensive and meaningful customer insights by capturing interactions across all touchpoints.

What Are Unified Engagement Platforms?

Unified Engagement Platforms are sophisticated tools used by retailers to create a seamless, personalized experience for shoppers. They function as an integrated system that brings together consumer data from various channels, both online and offline, into a singular, coherent view. This allows them to create a comprehensive and easy-to-understand profile of each shopper.

Basically, they combine various customer-facing tools into one platform. This can include a loyalty program, survey tools, feeds for press releases or marketing offers, or even online shopping catalogs.

This consolidation of data includes information about a shopper’s browsing habits, purchase history, personal preferences, and even responses to previous marketing campaigns.

These platforms are empowered with intelligent analytics capabilities that decipher this complex data to generate valuable insights. These insights inform a more personalized and effective communication and interaction strategy for each customer.

By doing so, unified engagement platforms enable retailers to anticipate and meet the needs of the shoppers even before they express them, thereby enhancing the customer experience and fostering loyalty.

Why Retailers Are Embracing Unified Engagement Platforms

According to the Salesforce Connected Shoppers Report, the percentage of retailers utilizing unified engagement platforms has dramatically increased over the past years. It highlights the growing recognition of such platforms as essential tools for successful data-driven personalization in the retail industry.

This trend again signifies that more and more retailers are prioritizing personalization, understanding its impact on shopper engagement, and investing in the most effective tools to achieve it.

Physical retailers widely adopt unified engagement platforms to provide a seamless, personalized experience across all customer touchpoints. In short, it allows them to simplify their data collection.

The Importance of Simplification

As the retail industry becomes more competitive, efficiently streamlining and operationalizing data has become a crucial differentiator. The Salesforce survey shows that 60% of retailers are strategizing or already implementing such initiatives, actively leveraging these platforms to harness and decode data for a more tailored and unified customer journey.

However, the transition is not without its challenges. Despite the growing awareness of the benefits, there are still 59% of retailers who manage marketing, e-commerce, and service functions through separate systems or applications — a practice that fragments the customer experience and hampers personalization efforts.

For shoppers, the impact of this shift towards unified engagement is tangible.

Findings show that 83% of shoppers reported increased loyalty to companies that ensure consistent interactions across departments. Consistency across departments, enabled by unified platforms, gives customers the impression of communicating with a single person or at least a cohesive, more responsive company.

Conversely, the absence of such integration is glaringly obvious to customers. Almost two-thirds of surveyed shoppers say they feel they are interacting with different departments rather than one unified company when they encounter inconsistent interactions or messaging.

This disconnect can significantly threaten customer retention and loyalty, underlining the urgent need for retailers to prioritize and expedite the adoption of unified engagement platforms.

Improved Personalization 

A unified engagement platform offers a wealth of data to physical retailers, allowing them to tailor the in-store experience to each individual shopper based on their unique preferences and behaviors. Retailers can utilize these insights to direct personalized marketing efforts, streamline customer service, and even adjust store layouts or product placements to better cater to their customers’ needs. Consequently, this level of personalization enhances the shopping experience, fostering customer satisfaction and loyalty.

Simplified Data Management and Access

These platforms simplify the process of data management and access for physical stores. It collates data from multiple touchpoints into a single system, making it easier to access, analyze, and apply. This streamlined data access allows retailers to make quicker, more informed decisions, contributing to enhanced operational efficiency and personalized experiences.

Improved Store Associate Productivity 

As sales or store associates take on more responsibilities, especially those unrelated to checkout duties, knowing what customers want or expect from their in-store experience becomes crucial. Unified engagement platforms empower store associates by providing actionable real-time data about customers, such as their buying history, preferences, and shopping behaviors. This information allows the associates to anticipate customer needs, personalize service, and optimize their time management, consequently improving productivity and the overall in-store experience.

Better Ability to Open New Stores

Unified platforms afford retailers the ability to efficiently scale their operations when opening new stores. They do this by integrating and standardizing data on shopper preferences and behaviors, which leads to informed decision-making about store locations, layouts, and product offerings. This helps retailers ensure better alignment between their stores and customer needs, resulting in greater operational efficiencies, higher sales figures, and more satisfied customers.

More Data-Driven Decision-Making

This unified approach allows retailers to track and understand the customer’s purchasing path from start to finish, recognizing patterns and preferences along the way. In return, the data gathered can be optimally used for more informed and insightful decision-making.

By leveraging their data, retailers can create more engaging experiences tailored to the needs of each individual customer. Moreover, this information is invaluable when it comes to understanding which products are being purchased and why, allowing retailers to identify inefficiencies in their operations as well as areas for improvement.

Generative AI: The Welcome Disruptive Force in the Market

Generative AI is certainly on the rise, and its impact is being felt across various sectors — including physical retail. This technology, powered by machine learning algorithms, is capable of creating new data that mimic the characteristics of the original data set.

For physical retailers, Generative AI opens up a world of opportunity to provide highly personalized service at scale. AI can be leveraged to generate content using gathered data on customer preferences and behaviors — making it much easier to personalize both marketing push and shopping experiences.

Another advantage of generative AI is its ease of use. There is no need for in-depth studying or specialized skills in order to use it well. With sufficient training and continued use, generative AI can be used even by store associates to create social media and online marketing materials, making it possible for them to fulfill their new responsibilities to a higher degree of success.

How Retailers Are Embracing Generative AI

By using generative AI, physical retailers can optimize their marketing efforts while still providing personalized customer marketing and experiences. It can help retailers automate the development of various marketing materials, which can help them save not only precious time but also money.

There are four marketing avenues where retailers are embracing the use of generative AI:

  • Produce Creative Assets for Ads, Emails, Social Media, and Websites. AI technology allows for a more personalized and engaging approach, enabling retailers to create compelling, creative, and context-specific visual content that resonates with each customer on a personal level.
  • Write Personalized Marketing Emails. AI technology can generate dynamic subject lines, offers, and product recommendations, making each email uniquely engaging and significantly enhancing the chance of conversion.
  • Create Personalized Promotional Offers. Generative AI can be utilized by retailers to create tailored discounts and deals to increase customer satisfaction and sales conversions.
  • Auto-Generate Personalized Product Descriptions. AI can be used to generate product descriptions that take into account each customer’s past purchases, browsing history, and stated preferences.

AI art, which continues to grow in popularity, is one of the most common ways retailers use generative AI, with 58% saying they do so. A close second is personalized marketing emails and other promotional offers, coming in at 56% and 54%, respectively. Lastly, 53% of retailers are using AI to create personalized product descriptions.

The Bottom Line

As the retail landscape changes and physical stores adapt to new trends, data-driven and intelligent insights will continue to become one of the main weapons in their arsenal to continue attracting shoppers and fostering customer loyalty.

By leveraging advanced AI technology, retailers are able to deliver highly personalized and compelling content, promotional offers, and product descriptions to each shopper. This level of customization, underpinned by a deep understanding of individual customer behaviors and preferences, has proven to increase customer satisfaction, engender loyalty, and drive sales conversions.

It’s clear from the report findings that the future of retail rests on the ability of retailers to adapt and innovate, employing intelligent insights to offer a high-value and truly personalized experience to their customers.

Visit the Salesforce site for more information about the 2023 Connected Shoppers’ Report.

For any questions or assistance with marketing your business, reach out to PERC Digital Marketing. Let our team help your business adapt to the industry’s fast-changing trends. Contact us today.

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Xavier Berkness

Xavier Berkness is the President of PERC, a renowned Digital Marketing Company. With an impressive career spanning over two decades since 1996, Xavier has earned a reputation as a leader in the field of digital marketing. He has leveraged his deep understanding and expertise in building websites to author a highly-regarded book, 'Mastering On-Page Optimization - The Secret Sauce of an SEO System.' Xavier's impactful contributions to the industry have been recognized in a Star Tribune feature, where he was hailed as a 'Mover and Shaker.' Outside the professional realm, Xavier is a nature lover who cherishes time spent near the ocean. He continues to fuel his passion for digital marketing, relentlessly seeking new knowledge and strategies every day. His combination of professional prowess and personal charm make Xavier a trusted authority in the digital marketing industry.