Article by Angela Chen
In today’s digital society, people seem to be connected anywhere and anytime. However, the reality is, we feel lonelier and more isolated. According to a recent Cigna survey, around 50% of Americans frequently feel alone, left-out or lack of close relations. Same phenomenon of loneliness and social isolation is observed in the UK and in Japan. Moreover, the number of single-person households is rapidly growing around the world. Since the 1960s, the percentage of solo households in the US has grown more than two folds, becoming currently the second most common household type. In large cities the share of this household type averages around 40% and peaks as high as 65% in certain neighborhoods in Washington D.C. and in Manhattan. The same tendency is witnessed in Canada and across the European Union: Approximately one-third of present households are single-occupied.
As a result people long for emotional connections more than ever before. This longing is not only for human to human relationships but also for consumers’ relationship with retail brands. Consumers need to feel included, known, recognized, inspired and appreciated.
How can retailers stand out from the overflow of information and create meaningful emotional connections with their customers?
First and foremost, diversity should be embraced: ethnicity, gender, body size, religion etc. People today are more encouraged and more audacious in being and expressing themselves due to augmenting societal progression and openness. Offers targeting a homogenous group of consumers have become a thing of the past. The future for retail is to welcome all different groups of consumers.
Second step is to get to know each other, just like in any human to human connections. Retailers should know their customers: their profiles, preferences, as well as consumption patterns and history. Vice versa, retailers should communicate their brand stories, values and offers in an honest and transparent way that builds a trust-based relationship with their customers.
Leveraging insights from customer data, retailers are now able to propose personalized offers and tailored experiences that recognizes and celebrates the individuality of each customer. The emotional connection of the customer and the brand is further strengthened as each customer’s particular needs, wants and issues are being heard, understood and responded to. Retailers can even use data to predict customers’ future interests and provide customized inspirations to stimulate customers’ continuous interactions with the brand.
To be able to achieve all of the above and successfully create emotional connections with customers in a simple and effective fashion, a modern data analytic tool that allows transforming insight into an actionable plan is a must-have. Microsoft CEO Satya Nadella pointed out in his NRF 2020 keynote presentation that the retail industry generates 40 terabytes of data per hour. This data can be used by retailers to know their customers and to empower their employees. But retailers must understand how to take advantage of this valuable asset in real-time or near real-time.
Oracle Retail Science and Insights Cloud Services answer retailers’ needs for gaining actionable insights from customers’ interactions with the brand. Combining customer segmentation, customer insight and customer decision tree modules, retailers will be able to
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- Create customer segmentations based on attributes and transactions;
- Conduct customer segment analysis (including demographics, behavior, loyalty and price sensitivity), market basket analysis and promotion analysis (halo and cannibalization, effect on initial and repeated purchases, as well as response and conversion rate);
- Analyze customer shopping behavior and product attribute evaluation process when making buying decisions.
All this information can be used not only to describe and to predict customer behavior, to allow targeted offers, pricing, experiences, but can also be interfaced into Planning and Optimization solutions to improve future assortments and to optimize markdowns and promotions.
If you are interested in exchanging thoughts on how to enable emotional connection with your customers, please feel free to reach out to us here.
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