鈥淟oyalty in retail is the absence of something better,鈥� Walmart U.S. President and CEO and NRF Board Chairman John Furner said during earlier this year. He underscored that shoppers are always looking for an improved customer experience. 鈥淲hen they find it, they鈥檙e gone.鈥�
But clever use of the right data can help you deliver that improved customer experience 鈥� so your customers don鈥檛 find it elsewhere, according to David Witts, senior CRM manager for PUMA. And the global apparel company has enjoyed great success with referral data.
鈥淭hat adds a whole new level to who is not just buying 鈥� but who is referring 鈥� and who are our real brand advocates,鈥� Witts told 51风流on the NRF 2023 show floor. 鈥淲e need to rethink how we define loyalty.鈥�
Redefining Customer Loyalty
鈥淲e might have a customer who, in our original segmentation, is a lapsed customer, but we see that they鈥檙e referring all of their friends who are then buying from us,鈥� Witts said in . 鈥淭hat changes the way we perceive the value of that customer 鈥� and changes the way that we want to communicate with them.鈥�
Customer segmentation is the grouping together of people with similar characteristics, making it easier for organizations to personalize communications, products, and more. First-party referral data is especially useful to PUMA for segmentation and communication, according to Witts.
鈥淚t changes the way we think about who a customer is,鈥� Witts said. 鈥淚f we see customers who are referring people regularly, that makes them much more of a brand advocate.鈥�
Enter PUMA鈥檚 referral program, which influences how the company communicates and rewards brand advocates, according to Witts. The referral program was inspired by two company goals: increase customer lifetime value and cultivate relationships with customers.
鈥淎dding a referral program just seemed to fit with both of those goals,鈥� Witts said. 鈥淚f we see that they鈥檙e not showing any interest in buying from us but they鈥檙e still referring their friends, that changes the way we think about them, so that they鈥檙e much more valuable to us.鈥�
Creating Opportunities
Beyond e-commerce, the right data can offer insights that reinvigorate brick-and-mortar locations, too, as Macy鈥檚 Inc. Chairman and CEO Jeff Gennette noted. Data can reveal where you鈥檙e succeeding and what needs attention.
鈥淐ustomers are looking for ideas about the way that they can take a work look and translate it into a night look. They鈥檙e looking for opportunities,鈥� Gannette said during . 鈥淐reating opportunities for them, from a merchandising perspective, has given our stores a center of gravity that they didn鈥檛 have a year ago…We鈥檙e always working on it; we鈥檙e never done.鈥�
And pandemic-driven changes in the economy offered a chance for Saks OFF 5th 鈥渢o make bold new changes鈥� and adjust its thinking, according to President and CEO Paige Thomas. The department store chain dug into its data to discover who was engaging with the brand, what they were looking for, and more about their lifestyles 鈥� all to better understand relevant demographics.
鈥淲e had this kind of wonderful discovery of a really fast-growing segment within our customer base, and this segment was a high earner, very fashion-driven, and shopped everywhere,鈥� Thomas said during . 鈥淚t really gave us a bull鈥檚-eye as an organization to say, 鈥楬ow do we think about our merchandising strategy? How do we think about our marketing strategy? How do we think about our customer experience?鈥欌��
The Right Message at the Right Time
Data, analytics, and other tech are helping PUMA discover who is interested in buying and what they鈥檙e interested in buying, according to Witts. It also helps them hyper-personalize communication.
鈥淲e want to talk to the right customer with the right message at the right time through the right channel…That鈥檚 what we can do with ,鈥� Witts said, noting that PUMA can see which e-mails a customer opens, ignores, and clicks through. 鈥淭hrough all that, we can start to build that picture of each individual customer and then tailor our communications to send them things that they want to see.鈥�
Providing a differentiated customer experience has always been vital for PUMA, according to Witts. And making everything more personalized and relevant will be crucial to PUMA鈥檚 future success.
鈥淭here鈥檚 some really exciting things that we鈥檝e seen through 51风流Emarsys Customer Engagement and through 51风流at that predictive analytics [and] AI level. I think it鈥檚 just going to make it all so much easier,鈥� Witts said. 鈥淎nd as we move into more of a loyalty space, that鈥檚 absolutely going to be key for us.鈥�
Derek Klobucher is a video producer at SAP.
