As online retailing continues to grow exponentially, retailers find themselves facing new sets of problems that weren’t indicative of the in-store shopping experience of yesterday.   Two weeks ago, Nike cited industry research that shows that roughly 60 percent of consumers are wearing the wrong shoe size.  This is a significant problem for the athletic shoe giant because many online shoppers overcome the challenge of finding a proper-fitting shoe by purchasing multiple sizes of their desired shoe online and then returning the ones that didn’t fit.  Trying on multiple pairs of shoes in the comfort of your home is definitely a great way to find the perfect fit, but it is also a very cumbersome and expensive solution. 

For one, it’s inconvenient for the customer to order and pay for multiple pairs of shoes and then go through the process of returning the ones that they don’t want. For retailers like Nike, it increases their cost since they have to process a much higher number of returns and credit customer accounts.

Technological Innovation Helps Better Serve Customers (and Improve the Bottom Line)

In order to save costs and better serve its customers, Nike introduced a smartphone app that uses augmented reality (AR) to perform a highly accurate scan of one’s foot utilizing a smartphone camera.  By mapping out a morphology of both feet, the customer is assured that the size ordered is the only one necessary.  This innovative technology builds the level of trust that shoe buyers have in Nike which helps solidify brand loyalty. 

What’s more, Nike saves the foot map results in the customer’s profile for later use.  This insight into the customer’s foot physiology has a number of business benefits for Nike including building personal relationships that retailers are striving to create with each customer in order to better succeed in a hyper-competitive retail environment.  Nike’s undertaking is part of a massive trend in the retail sector as 100 million consumers will shop in AR online and in-store by 2020 according to Gartner, Inc.

AI Helps You Learn About Your Customer

The first commandment of retail is “Know thy Customer.”  To better understand your customer, you need information and a way to process and interpret that information.  This is where AI and cloud service providers such as Azure come into play.  According to a McKinsey study, AI could potentially generate $4 billion to $8 billion in annual revenue for the global retail economy as well as $2 to $5 billion in consumer goods.  A greater insight into shoppers means a greater ability to convert them into regular customers.  That is the power of AI.  AI and the data gleaned can:

  • Increase promotion efficiency
  • Cultivate personal relationships with your customers
  • Innovate and develop new products
  • Increase sales transactions
  • Reduce customer complaints
  • Build brand loyalty

Chatbots and Azure

Chatbots are also growing more prevalent every day in the retail industry. Retailers are using Azure’s Bot Service and Framework to service customers more effectively and efficiently.  Modern bot software today relies on a growing stack of technology and tools in order to deliver increasingly complex experiences that users now demand. 

Gartner has stated that 25 percent of customer service and support operations will integrate chatbot technology by 2020, up from just 2 percent in 2017.  They also believe that within a few years, chatbots will power 85 percent of all customer service interactions.  In fact, by then, they predict that the average consumer will have more conversations with chatbots than with their spouse! Juniper Research estimates that by 2023, 75 percent of all chatbot interactions will be retail-based.  Why? Because the retail sector is one of the most promising sectors for automated agents with huge upside revenue potential. What’s better? Implementing this technology costs less in the retail sector. 

Many online shoppers have experienced chatbots first-hand; but chatbots aren’t limited to online commerce alone.  Large box retailers and shopping malls are integrating them in order to help customers locate and direct them to products on the shelf.   One example is the Mall of America that services 400 million people a year.  The mall’s chatbot is accessible through a number of alternative mediums and helps customers locate retail and restaurant establishments in real-time.  It can even makes suggestions or connect the shopper with a mall associate for additional information.  The integration of online AI-driven tools within the brick-and-mortar environment creates an omni-channel retail experience for the shopper in which they can experience consistent service throughout all of their shopping interactions.  This omni-channel strategy allows consumers to purchase wherever they are, whenever they want – and stay in constant communication.

Sentiment Analysis and Gesture Recognition

The ability to determine what your customers may want before they are even fully certain would be a huge competitive advantage for any retailer.  This requires the ability to understand the opinions or sentiment of shoppers.  The good news is that consumers today express their sentiments everyday through social channels, text messages, chatbots, tweets, online reviews, etc.  One of the ways that Microsoft Azure offers this capability is through text analysis. By analyzing these sentiments, retailers can fine-tune their suggestive marketing strategies when they come in contact with customers. 

Retailers are also integrating apps and kiosks into their stores in order to serve customers more efficiently.  Taco Bell was able to increase their average order transaction by 20 percent by encouraging customers to use its app rather than human cashiers.  Cinemark Theater’s use of self-service kiosks increased concession spending per person for 32 straight quarters.  Kiosks are even more effective when AI technology is integrated with facial and/or gesture recognition.  With facial recognition, frequent customers are instantly identified as they approach a kiosk or storefront. The technology then offers suggestions based upon known shopping history.  And gesture recognition enables shoppers to find their preferred products with a simple wave of the hand using a touchless device.

Moving Forward in Retail

No facet of retail has been untouched by the technological disruption in recent years.  AI helps give the insight you need to create seamless and effortless experiences with customers.  By better understanding your customers you help build customer relationships with your brand. Ultimately this brand loyalty reduces the likelihood that your customers shop elsewhere.  What’s more, the efficiencies that AI brings to your operations helps reduce costs that will add to your business’ profitability.  The digital transformation of the retail sector has already begun.  Now it’s time to fully embrace it. 


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Introduction

As a small business, you have enough challenges keeping your head above water and focusing on how to grow. Navigating the digital world can be complex if you don’t understand the various channels and what you should focus on to get the most bang for your buck.  Even if you do understand the technologies, how do you find enough time in the day to do it all?  In this paper we will give you a concise list of things you can easily do to boost your business by leveraging the power of digital with web, social, and mobile.

According to the Boston Consulting Group, businesses that make use of the web expect to grow 40% faster than those that don’t.  And according to Google, 97% of consumers go online to look for local products, yet only 37% of US small businesses have an online presence.  Increasingly, the web is important, but so is making use of social media and mobile technology to engage  with your potential customers.

If digital technologies like web, social media and mobile are so important, then why don’t all small businesses make use of them?  There are several reasons that include perceived cost associated with doing it, not having enough time, or believing that it’s just too complicated.  Lucky for you, there is plenty of help to address the complexities of digital while also managing your time challenges.  There are marketing services companies that cater to small business needs.  It’s also less expensive than you think, especially if you can pay for it with the increased sales that you can enjoy.

So let’s get to it – here are our top tips for digital success.  

Responsive Design

 

1.  Have an online presence with a responsive design

Since consumers are going online to search for businesses, unless you have a website you will not be found!  Consumers will go to your competitors if they are easier to find.  A couple of other things to consider are optimizing your site for relevant keywords that consumers may be searching on and making sure you have a responsive design. By having the right information and content on your website, you will help your company be found when consumers are searching.  

A responsive design simply means that your site is optimized for viewing and interaction across different types of devices (computer, tablet, mobile).  The site will be easy to navigate, read, and interact with, taking into account the different screen sizes that your web site can be accessed from.  Also consider the user experience.  They want to be able to access the information in as few clicks as possible.  So, put yourself in the user’s shoes when designing your website – easy to navigate equals better engagement for you.  Clunky or disorganized websites will result in potentially lost sales opportunities or your user exiting the site.

 

Google Ad

  1. Get your business on Google

Getting your business listed on Google is another important step to getting found online.  Google My Business helps you get listed on Google and also provides key information such as business overview, hours of operation, phone number, and address.  For users using their mobile, they can use Maps to get directions and click to call.  Consumers can also leave ratings and reviews of your business.

 

  1. Advertise online to drive traffic

These days, advertising online has also become important to drive new customers to your business.  It’s fairly easy to set up an advertising CPC campaign on Google.  With Google Adwords, you can specify whether you want your ad to be local and what specifically you want to advertise.  Google provides tools to help you decide which keywords to advertise, setting up budgets, and managing the whole campaign.  And the good part is that you only pay if someone clicks on your ad.  There can be potentially many more people that see your ad and read it, but you don’t pay unless they click.  It’s important to track how much business is resulting from your advertising budget and make regular adjustments as needed to get the most out of it.  

  1. Use social media to connect with your customers

The top social media platforms you should consider are Facebook, Twitter, Google+, Youtube, and Pinterest.  You don’t have to be on all of the social media channels, but the ones that make the most sense for your audience.  It gives you an opportunity to build loyalty with your customers and connect with them outside of your normal business interaction.  It also provides an avenue for you to then share what’s new with your business, advertise specials, and foster a loyal customer base that will keep coming back.

 

use mobile

  1. Use Mobile

We already talked about a responsive design that helps you interact with customers that are on different devices such as tablets.  That will also help you for customers using mobile.  Increasingly, consumers are using their phones to make purchases, search for local businesses, and using click to contact the businesses directly.

People are also spending more and more time on their mobile compared to other devices.  Their mobile is always within reach.  If it makes sense for your business, you should also consider mobile advertising, such as SMS, MMS, or banner.

  1. Use analytics to understand and improve

Now that you are online, advertising, and getting found by your customers, you need to understand if the money you are spending is giving you a return on your investment. Analytics will help you track and review data that is relevant to your business.  Best of all, Google Analytics is free!  You can track every click, measure every dollar, and get insights on the type of device that your customers are connecting with (mobile vs. desktop).  And by looking at how many conversions you have, the dollars of business that translated into, and how much you spent on advertising, you can tie it all together to ensure it is paying back.  You can also tell if your activities on social media are driving traffic to your website.  

Summary

Now you have the 6 top tips for succeeding in the digital world.  Perhaps you were already doing some but not all, now is a chance to dive into the rest of the digital initiatives.  Some of these tips are free to implement (Google My Business for example), so it won’t cost you a cent.  It will take an investment in time, but increasingly digital is the way to reach your target customers.  And if you can’t do it all yourself, there is plenty of help out there without breaking the bank.

 

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I meet business owners, marketers and digital folks everyday who try to gain new business, via the digital channel. When I say digital, I mean through their websites, mobile, social media presence, organic and paid search methods. I have to admit, there’s a lot of sophistication that marketers are using to launch their campaigns across various digital channels – and their spending big bucks to do it. But, I am surprised at the adoption rate of some marketers when it comes to measuring analytics correctly across these digital channels. Marketers tend to say, “I love digital because I can measure it”. Allegedly, digital methods conquered the question of where each marketing dollar actually goes. But when you get down into the weeds, you realize the measurement is half baked based on a few statistics – such as clicks, page views or other nonsensical stats.

By itself, your Adwords report is meaningless unless you know how much money those clicks made for your company. Your social media posts are great for perception but not much value if you don’t lead your followers to your business to buy, buy, buy. Your search optimization dollars are great, but do you know what happens when users reach your website? All in all, it doesn’t matter if you are number one in search if you are not making a high return on investment.

So how do you solve this problem? Here are a few key tips:

1. Spend some time ensuring that your analytics platform is installed properly and standardized across your organization.

2. Work with your agencies to define your requirements and goals of your website. Make sure those goals and conversions are correctly implemented on your site. Free and paid analytics products support this turnkey solution and this is an easy and critical component that will give you great data on what’s working.

3. Give dollar value to your goals and conversions. Attribution reports can tell you which channel is giving you the best bang for the buck.

4. When steps 1-2 are done, ensure that every campaign, post and banner follows a standard method to tracking. Use campaign parameters to ensure you can easily find your campaign in your analytics tool.

5. Analyze, analyze, analyze your data over time to see what is working what’s not.

6. Add more dollars to what’s working and ditch what’s not.

7. Make changes to your website and campaigns and then analyze, analyze, analyze some more.

In summary, digital has opened up multiple channels for us to market and attract new customers. But, in order to understand what is working and not working we need to be more sophisticated in how we measure. If you’re going to pay big bucks for a website, Adwords, social media presence, or even a simple banner, then challenge your agencies to confirm and provide data that show which of the strategies are working to meet your marketing goals. While clicks and page views are fine, they are just the tip of the iceberg. Savvy marketers should measure data that shows number of orders, number of sales leads, number of visitor inquiries and number of conversions.

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We just returned from the AMA Conference: Analytics With Purpose, held in Scottsdale earlier this week. This was Xcelacore’s first time sponsoring an AMA event and we were honored to represent the business. This was a great opportunity to hear from industry experts on best practices and learn what other leading companies like AOL, American Cancer Society, Charles Schwab, and IBM are working on (not to mention the great Superbowl party!).

Most importantly, it gave me a chance to meet other marketers and hear about their challenges. Many of the attendees I talked to were there to learn more about analytics and then apply them at their companies. An important pattern I noticed was that many marketers are struggling to figure out where to start with analytics and digital marketing technologies. Some have pieces of the puzzle in place, but not everything is connected. Others are further along. Every company is at a different place in the maturity curve for implementing and using marketing technologies.

But the common theme is the lack of resources and expertise internally to get where they want to be. Almost everyone talked about realizing the importance of having the right tools (including digital analytics) in place to be more efficient and informed on how their marketing activities are performing. So that left me wondering why enterprises aren’t allocating a bigger budget to make it happen. Why wouldn’t you want to have visibility into your marketing activities’ success and ROI?

I have some theories on this, having run marketing organizations in previous roles. But I would love to hear from you directly. Write me at mansoor@xcelacore.com and we can exchange some ideas on this topic.


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