Driving Brick and Mortar Sales with Big Data!
Edward McLeod |
Amazon is a beast! They and other online retailers are digging deeply into your brick and mortar (B&M) sales. Most stores cannot survive if they lose 25% of their gross revenues. Per an April 15, 2017 New York Times article , American B&M retail sales are at a tipping point. 89K general merchandise jobs have been lost since October, 2016 ... more than the entire US coal industry! With approximately 1 in 10 Americans working in retail, B&M’s future looks bleak.
Your B&M business is struggling … what can you do? How can you provide B&M shoppers with an exceptional, Amazon-like experience? It’s a daunting task. It can be solved, but it requires cross-manufacturer and retailer collaboration.
The B&M solution builds upon the GS1 standard I co-chaired to drive packaging label standards in 2012. It leverages the label content communication standard and key marketing information to consumers at the point of purchase (PoP). You may even be participating in GS1’s current US Mobile Scan efforts. Pushing content to shoppers is necessary, but not sufficient.
What if …
· You knew when your shoppers were in the store?
· You could deliver product benefits, reviews, and other content to their mobile devices?
· You could alert them to nutritional facts or ingredients to which they had allergies?
· You knew shopper preferences and could personalize marketing messages?
· You could offer coupons or loyalty points when they were looking at your products?
· You could suggest additional purchases in real-time?
· You could verify your PoP materials were deployed in every store?
· You could assess promotional effectiveness based on demographics?
· And what if a single solution worked across every retailer?
This is the promise of Big Data and communicating with shoppers at the PoP! This sounds great, but how can you deliver against this objective? The good news is the required technology exists today, but there are go-to-market issues.
Communicating with shoppers at the PoP works like this:
1) The shopper scans product GTINs with our mobile app. The app includes their personal preferences to return the information that is most meaningful to them.
2) The app looks up the product information.
3) Based on the product scanned and the shopper’s preferences, personalized marketing messages are delivered to the shopper.
4) The Magic Moment! The shopper receives data that is meaningful to them to assist their purchasing decisions.
5) Creation of the Mother Lode! The shopper’s scans record who scanned which products, at what location, and when they did it!
6) Manufacturers and retailers integrate the shopper actions with their POS data to quantify the sales lift versus history.
The road to success is cross-manufacturer collaboration! The entire approach hinges on delighting the shopper at the “Magic Moment.” They must receive personalized data providing them with a superior shopping experience! This can only be accomplished with critical mass and a clear identifier so shoppers know which products are, and are NOT participating in the program. If few products participate in the program, the shopper will lose interest, and the solution fails. Similarly, if the shopper cannot differentiate participating from non-participating products, they will stop using the app. Nobody likes taking an extra process step (scanning the product) to yield no results!
So, what must be true to delight the shopper and build the Big Shopper Data?
· At least 30% of a retailer’s product volume has product information available to shoppers.
· Participating products must have a common identifier on the front label notifying shoppers that product information is available. Think of a recycle symbol, rather than a QR code. The symbols purpose is to notify the shopper they can scan the GTIN to secure product information.
· The mobile app is the key! It must be easy to use and provide personalized value to shoppers.
Key issues, risks, mitigation plans, and value
• Shoppers / Consumers
• Risks / Issues
• Lack of program knowledge - Advertising campaign
• Acquisition costs / how to get them to engage (the “Magic Moment”) – verify and deliver a superior shopper solution
• How to recognize the participating products – Label icon
• Benefits
• Decision-making data when shopping
• Rewards programs
• Ingredients
• Information during consumption
• A single app across retailers
• BIGGER print
• Retailers
• Risks / Issues
• Some top retailers already have shopper apps. The shopper-centric app generates two issues:
1. Retailers no longer control all of the shopper data
2. Levels the cross-retailer playing field. Today’s leading retailers lose their competitive advantage with a centralized big shopper data and analytics approach.
• Mitigation approach: Share the information back with retailers. They secure additional product insights based on the specific shopper requests.
• In-store wifi – not required, but an opportunity to delight shoppers
• Benefits
• Incremental sales via improved product data
• Need to act quickly to save brick and mortar. If online sales take 25% of a store’s gross, they will likely fail
• The eCommerce competition
• Risks / Issues
• eCommerce growth is explosive – Compete by providing a superior B&M shopping experience
• Benefits
• Drive brand loyalty vs the lowest price available on the web
• Manufacturers / Brand Owners
• Risks / Issues
• Cost – Solution development, deploy, and support. Offset by big shopper data value
• Top retailer friction from the competing app – Share shopper data with retailers
• Levels the playing field for less sophisticated manufacturers – Manufacturers compete on their analytical capabilities
• Lack of structured label content – leverage existing application solutions based on the GS1 labeling standard
• Benefits
• Personalized, in-store marketing
• Incremental sales
• Shopper loyalty via rewards programs
• Perceived as more tech savvy and transparent than competitors
Contact me now at Ed.McLeod@cleveltraining.com to participate in a consortium to deliver this solution. Success requires critical mass and a willingness to place a common identifier on your product’s front label.
© 2017, C-Level Training, LLC