While online sales continue to take on retail, the most successful retailers have discovered that the secret to success is to prioritize what it is your customers truly want, invest in the technology and people to deliver it, and make the experience seamless across channels. Before I talk about the five ways they do this, I want to share recent Custora research that gives insight into what’s driving retail growth.
Average Order Frequency Beats Customer Acquisition
Yes, you read that right. High-growth brands invest significantly in acquiring new customers, but it’s relatively inefficient.
Savvy retailers have responded, instead investing their dollars in things like welcome series, hybrid subscription models, and personalization across channels and devices to drive brand engagement and product discovery.
Increasing Average Order Size Increases Revenue
Another powerful finding from Custora is that increasing basket size is more beneficial than just trying for repeat business. The most successful data-driven retailers excel at cross-selling by suggesting complementary products the customer may like or upselling by showing the customer premium merchandise and full-price new arrivals.
But, most retailers will tell you that growing basket size is more difficult than driving repeat business. They are right – unless they are doing these five things.
The 5 Steps to Retail Success
- Analyze Your Customer Data: You gather lots of data on your customers. Take a look at it and see what it’s telling you about your customers’ relationship to your brand.
- Create A Plan: Are you going to try to cross-sell or upsell? Determine that objective and then set goals. In general, cross-selling is a good starting approach for retailers of relatively low price-point goods, impulse purchases, or a wide merchandise assortment. Retailers of homogeneous or high-consideration goods might instead focus on upselling.
- Look At Your Sales: Now it’s time to study your sales and see what that data tells you. What products are typically purchased together? Which customer type tends to buy premium products? Knowing this information is invaluable.
- Start Small: The most successful retailers keep it simple when they are just beginning. So, begin with just one offer and measure its impacts and adjust accordingly, then expand from there.
- Optimize And Automate: Once you have identified what works, keep your momentum going by continuing to monitor your data and tweaking your approach in response to what your data is telling you.
By implementing these five steps, retailers unlock untapped opportunity and increase their ability to grow and thrive – even in the digital age.
In a climate ripe with data gathering and advanced analytics, the mood of our prospects isn’t often considered. We’ve come so far since the early days of advertising, yet in many ways we still rely on the yesteryear approach to marketing. Think about how we price advertising, which is archaic when you consider it’s best to buy ads one at a time based on analytic analysis. Equally outdated is the basic premise of demographics – a practice that begun in the 1920s – and it’s enduring focus on greater segmentation and third-party data collection with disregard to how we consume media in today’s economy.
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