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Author's profile photo Former Member

Customer insight – hot topic for the next years

Although there are many blogs about customer insight, lately the retail industry is getting more focused on the overall topic.

Not only the example of beer and diapers (place them together to boost either sales), it is a unseen battle for more knowledge about the customer. And this need data, data and furthermore…data. It is true: every company want’s to know as much as possible about their customers. While CRM is a big topic in the indsutry (business to business), retail is still struggling to implement scenarios, that really work.

More than once I have seen, that retailers offer me a way to connect and register with them, but then: nothing happens. No offers, interesting infromationsor anything. Especially smaller / mid size retailers seem to have trouble to not only gather data, but to USE them. (In a way, that doesn’t repell the customer and still brings a benefit to the company!)

But even big size retailers are experiencing some obstacles:

Why is that?

1st – most/all customers are unknown to the retailer. If not using a corporate shopper’s card to safe money or collect points, it is still hard to get personal information about the customer. (By the way: even if the company does have a corporate shopper’s card, the customer can still decide if he/she wants to use it!)

2nd – most companies are using a payment provider for credit / debit card traffic. (Simply, becaue they do not want get into the target, when a credit / debit card is being misused and the customer’s data is saved on their own hardware.) So this is not giving the retailer any information at all.

3rd – Besides actively posting in social media, a company can gather great insides, what people think about the retailer.
BUT: how can a company connect the shopping behaviour of a certain customer to his social media profile(s)?

4th – Mobile / smartphone apps are mostly expensive, are having a short lifecycle and if the community does not like them, it is possible to get a lot of laughter for having one of many shopping apps, that nobody needs and does not give any customer a good reason to install and keep on his mobile device.

5th – The POS / cash register data is anonymous until I find a creative way to connect with one of the above mentioned processes. (shopper’s card plus app plus …)

I am more than curious to hear / read about the communties journey and SAP’s technology (social media plus CRM plus CAR plus HANA).

Will SAP’s new technology stack finally get retail business closer to all customer’s? I sure hope so.

Thanks for reading my first blog!

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      Author's profile photo Former Member
      Former Member

      Predictive analytics and the loyalty card are two completely different ways of tackling the unknown customer. The challenge with loyalty is always how to avoid giving away margin to the 85% of customers who sign up.  Predictive on the other hand can show clusters of customers, and help generate some potential insights on what might be worth promoting to them. Would be interesting to hear where others see predictive going in this space. Many retailers I've spoken with in the past year are running the same segmentation models on their loyalty or sales data, or they are simply selling the data to CPG suppliers, in an anonymized form.

      As far as the famous beer-and-diapers go - I was in the middle of it. Let me disclose a bit of history. Stores Automated Systems Inc., of Bristol, PA was working with Visual Insights, a division of AT&T Bell Labs back in about 1996-2000. SASI had lots of POS data from customers like Rite Aid, Andronico's, Pep Boys, and others. VI was in the process of acquiring Toronto-based Visible Decisions, Inc. the visualization brains behind i2 Rhythm Reporter and Cognos. I'd been at VDI for years, and moved to VI post-acquisition. VI had found ways to visualize item affinities, which products were sold together, and the SASI people had the data from their retailer customers. After a successful few years at the VDI/VI org, I moved to Triversity, that ironically bought SASI. Then years later, SAP acquired Triversity. So, SAP retail has true heritage of the Beer and Diapers story. It was real, with real data.

      Author's profile photo Former Member
      Former Member
      Blog Post Author


      thanks for your additional information about the differentiation of predictive analysis and loyalty programs at large.

      Your own history of being part of "beer / diapers" (I just love this dictum) is very interesting. Thank you so much for your insights on it!