Good, better, best. This motivational phrase is familiar not just to children but to employees reand managers alike. But retailers hope that by applying analytics to their strategic decision making, they can turn it into a reality for customers as well.
In an effort to make good customer better, make better customers the best, and make the best customers into superlative shoppers, retailers need to know first what these customers want. Thus to personalize their product assortments and services, retailers are turning increasingly to analytical technologies. Such technology can not only reveal past transactions but also predict future desires.
In 2010, 41 percent of retailers listed customer-centricity as their enterprise strategy (up from 11 percent in 2009). Such an orientation demands that the retailers offer more of the products and services that customers desire, provide support exactly where it is needed, and discontinue unpopular products that distract from the appeal of their assortment. Such efforts should lead to greater transaction sizes and increased purchase frequency.
Yet customers remain ready to switch if they do not find the products and experiences they want. Analytics offer a powerful tool for understanding customers, but customer centricity also demands the ability to act quickly on the basis of the information obtained. Implementing changes to a retail mix remains a challenge that requires careful, effective approaches to provide the good, better, and best customers with the products and environment they demand.
How much is it possible to improve customers, in terms of their patronage of retailers?
Why don’t all retailers use such analytics already?