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After three full days of sessions, 400 speakers and 40,000 attendees, Gwyneth Paltrow, founder and CEO of Goop, wrapped up this year’s National Retail Federation’s (NRF) 2020 Vision conference. In her keynote, she spoke about her path to becoming an entrepreneur, an early adopter in health and wellness and scaling her business. “I never would have thought I would need to know accounting when I was on the set of ‘Shakespeare in Love,’” she explained to the packed auditorium.
Her talk summed up the conference’s big theme: how do we better understand our customers and improve their journey with our brand. And we saw this repeatedly at the sessions with the biggest names in retail from Target to Patagonia to eCommerce giants like Zappos and Rent the Runway.
To accomplish this, guest speakers emphasized the importance of leveraging customer data to produce relevant and personalized experiences. They wanted to build a single view of their customers to form the best customer experiences.
What is the single customer view?
Also known as the 360-degree customer view, this is when you create a holistic and unified view of your customers. By aggregating real-time data from a variety of sources, companies are able to use this data to create customer profiles that help them better understand their customers. This information is used by brands to build experiences tailored to the customer, which leads to higher engagement and an improved experience.
However, much of the attendee conversation at NRF 2020 was on how to get started on building that customer profile before personalizing their customer experience. Here are our top three insights from NRF 2020 Vision.
The 3 Key Takeaways From NRF 2020
1. Your biggest asset could be customer data.
Microsoft’s CEO, Satya Nadella, delivered the opening keynote on how data will separate the next decades retail winners and losers. “Retail is a massive generator of data,” he said, “40 terabytes per hour. What will we do with all that data?”
Retail has the opportunity to use this data to understand their customers and reinvent business models. “You have to change the dynamics. You have, as retailers, the most valuable asset: commercial-intended consumer behavior data. The question is, how can you, through your marketing efforts, convert that into effectively new online advertising channels that could benefit every brand, every supplier. This, to me, is perhaps what’s needed to reshape retail.”
2. I hate to break it to you, your offers aren’t cutting it.
Christian Selchau-Hansen, CEO and founder of Formation, asked attendees to rethink their definition of personalization. In today’s world, traditional notions of personalization (which in reality is often just segmentation) is no longer good enough, especially with offers.
He spoke about how companies need to move from a product-centric to a customer-centric strategy to truly provide 1:1 personalization. By innovating with machine learning (ML) and artificial intelligence (AI), companies can fine tune offers for the individual versus cohorts based on demographics. This type of individualized approach will help companies understand their customers’ motivations, increase engagement and then “leverage machine learning to reinforce those behaviors and those journeys, automating that learning process,” said Selchau-Hansen.
“It’s important that your offers are driving incremental behavior, so you're not rewarding customers for actions they were already going to take. You're able to focus those limited marketing dollars on the offers that'll drive the biggest impact for your brand, your product, your service.”
3. Focus on the customer journey and meet them where they are.
Different companies had different strategies, but they all agreed that they needed to focus attention on the customer’s journey. One good example was Erik Nordstrom, co-president of Nordstrom, who discussed serving customers on their terms.
Looking back at the 2019 holiday shopping season, Nordstrom expanded its services like buying online, picking up in store and same-day delivery. They were serving customers with a mix of online channels and in stores with a more experiential twist. “Stores need to be more experiential,” he said, “and not just about picking up an item.”
One example is the bar in New York’s main shoe department. “People are smiling,” Nordstrom said. “Strangers are talking to each other. We think a lot about shoes. I don’t know why it took us so long to put drinking and shoes together, but it’s a great combination.”
For 2020 and beyond, it will be less about specific markets, and more about increasing customer engagement than leveraging inventory. And his advice was for retailers to stay curious and be humble.
For more about how you can create 1:1 personalized offers for your customers, read our latest white paper, “Why Personalization Isn’t Always Personal.”