Turning Retail Footfalls into Retail Gains

102 | March - April 2013 |

There is no simple formula for

turning retail footfalls into

financial gains. In fact, it takes

an army of retail specialists in

m a r k e t i n g , m e r c h a n d i s i n g ,

operations, supply chain, employee

training and countless other retail

a c t i v i t i e s t o d e l i v e r r e t a i l

performance. With the recent

changes to FDI in India, that job just

got harder. The expected influx of

new brands, fast-track modernization

of stores, increased scale of retail

operations and mounting competi-

tion will have retailers sharpening

their pencils. Traditionally, brand

building has been enough to drive

customer footfalls, but rapid-fire

brand extensions and the exploding

digital noise is taking its toll. With

media fragmentation and message

overload, Indian consumers, like

retail customers the world over, are

rapidly reaching a saturation point.

The old ways of connecting with

customers through massive media

spends for brand salience and image

Customer Loyalty

So how well do you use the customer information that you gather? If at all, the only aim that you

have is to use the information for sending mass SMS' and emails telling the customer about the

various discounts you are having at your store, you are at risk of losing him /her for good.

Caroline Papadatos, senior vice –president- International at LoyaltyOne shares some interest-

ing do's and don't you need to keep in mind.

The old ways of connecting

with customers through

massive media spends for

brand salience and image

building are being eclipsed by a

new reality: the customer is not

listening.

103 | March - April 2013 |

building are being eclipsed by a new

reality: the customer is not listening.

So what's the answer? While

executional excellence in product

quality, real-estate, supply chain and

pricing are paramount, retailers

should recognize the hidden asset of

customers and mine the predictive

power of their data.

The new practice of retail marketing

demands a fundamental shift from

brand marketing to customer

marketing, and the mapping of a

customer journey that starts with

brand awareness and ends with

customer advocacy. Somewhere in

that continuum, the retailer needs to

connect with their customer, identify

them by name and build a relation-

ship. Without that, customers are just

“eyeballs and footfalls”, faceless,

nameless and indistinguishable from

one another.

Data is the key to turning footfalls into

retail gains. The marketer's journey

still begins with the traditional

measures of brand consideration;

building retail awareness, building a

positive attitude to brands and

incenting trial. But at the point that

the customer enters the store to

make his or her first purchase online

or in the mall, retailers need to make

it their mission to identify that

customer with contact information,

and obtain enough data to prompt

their next purchase.

From this standpoint, the kirana

owner has organized retail beat. He

knows his customer by name, their

families, their likes, dislikes, and

buying patterns. Without data or

predictive modeling, he knows who

pays and can anticipate their needs. If

Indian retailers are going to stay

ahead of the retail transformation

and heightened competition that FDI

forebodes, they will have to put

customers in their corner. It starts

with the ability to collect customer

data and use it in a way that is

respectful and relevant. Retail

customers are mistrustful of

providing their data because they

have been deluged with sms spam.

Today in India, Below-the-Line

individualized data is being used to

drive Above-the-Line mass marketing

activities, and it's making customers

angry and cynical.

Assuming Indian retailers can curb

the misuse of data, retail marketers

can start the work of activating that

customer, lifting their spend and

building loyalty. There are 3 keys to

moving that customer from a casual

drop-in to a regular shopper.

Rewards – like any relationship, the

customer proposition has to be a win-

win for both the retailer and the

customer. If the retailer is asking for

repeat purchase, bigger basket sizes

and retention in the face of competi-

tion, the customer is looking for their

Customer Loyalty

R e t a i l c u s t o m e r s a r e

mistrustful of providing their

data because they have been

deluged with sms spam. Today

in India, Below-the-Line

individualized data is being

used to drive Above-the-Line

mass marketing activities, and

it's making customers angry

and cynical.

104 | March - April 2013 |

loyalty to be rewarded. It could be in

the form of discounts, special

promotions or loyalty points but

whatever it is, it should be offered

selectively to customers to reward

them for their individual business.

Nothing makes a customer happier

than knowing he's getting something

reserved for the few.

Recognition–customer data gives

you the means to recognize your best

customers every time they enter your

store. If you have a loyalty program,

you will have a record of every

transaction across all channels.

Recognition can be as simple as

knowing their name and greeting

them in the store, but as customers

give you more business they will

expect you'll go the extra mile. It

could be a special store opening,

party invitations, valet parking, home

d e l i ve r y o r co u nt l e s s o t h e r

experiences that signal that you value

their business.

Relevance – communications that

are targeted using transactional and

multi-channel data consistently

deliver increased response rates at

lower cost, with lower opt-outs. Best

customers are always multi-channel,

but if we want customers to engage

with brands in social media, web, in-

store or digital communications, we

have to reward them with targeted

and relevant messages. If the offer is

a discount on the case for the camera

I bought last week, or South Indian

recipes that I can use with my newly

purchased XX, you can be sure your

customer is interested.As customer management practices

take hold in India, retailers will

increasingly need to account for their

marketing spends in ways that are

measureable and ROI-driven. The old

school of brand impressions,

frequency and reach is being

supplanted by customer acquisition,

activation, lift, shift and frequency

measures. Even in recession-stricken

retail markets, best practice global

retailers have developed customer

marketing platforms that deliver

sustained channel savings and

incremental growth from their loyal

customers. As footfalls are identified

as customers, data will translate into

retail gains, but the journey starts

with the single step of collecting

customer data.

About Caroline Papadatos, SVP

International at LoyaltyOne:

Caroline is a senior loyalty leader with

deep expertise in brand, marketing,

customer management and CRM. A

successful change agent, she has

d e m o n st rate d ex p e r i e n c e i n

designing and executing transforma-

tion customer loyalty strategies for

retail clients and partners.

About LoyaltyOne – global leader on

consumer insights and strategy,

loyalty marketing and customer

experience management.

LoyaltyOne: aims to transform the

landscape of the Indian loyalty

industry by creating value through

customer centric marketing, retail

analytics, customer lifecycle manage-

ment, data privacy and usage.

Customer Loyalty