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Mobile blurs distinction between customer acquisition, experience: BloomReach

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October 10, 2014

LITCHFIELD PARK, AZ – A BloomReach executive at the Mobile Shopping Summit 2014 said that retailers should build more unified offerings to take advantage of how mobile is blurring the distinction between customer acquisition and customer experiences.

During the session, “Establishing Core Omni-channel Analytics To Track Mobile Revenue & Maximize Conversion Rates Across All Digital Assets,” the executive said that a lot of retailers have not kept up with changing customer expectations. In particular, many are still focused on different marketing channels even though this is not the way that consumers shop.

“Ask your companies how much your acquisition budget is and how much your mobile budget is,” said Raj De Datta, CEO and co-founder of BloomReach. “That is probably at least one order of magnitude different.

“What we are saying is, let’s go participate in an auction against the world to acquire a customer on Google, pay ten times that amount to Google relative to what I would to invest in my customer when they arrive on my web site or on my app,” he said. “This is a path to low contribution margins and to low prices and deals.

“The thing I think we have to take away from this idea of customer acquisition is that there is no notion of a marketing channel separate from the experience anymore.”

Evolving expectations
Consumers do not think in terms of shopping on email or on their phone or from Pinterest. Instead, there is a continuous journey through all of these and retailers need to think in the same way.

However, extending the idea of omnichannel to where there is one unified experience is easier said than done.

“It is no longer about search and mobile as a channel,” Mr. De Datta said. “It is people taking pictures and that being a channel, it is people SMSing and that being a channel. It is the number of new social networks that get funded every week.

“If we treat one of these as a channel then we have to multiple our teams by 50,” he said.

The way the Internet is structured in changing to address evolving customer expectations. This is exemplified by how the Google search engine is moving away from the static notion of tagging towards being continuously self-learning so it can understand every piece of information out there and to better give searchers what they want.

Internet structure
Mobile is driving much of this change.

“I would argue that when I go to a lot of commerce businesses out there, it is still structured like the Internet used to be, with a directory structure, category tags and a home page and subcategories, and navigation,” Mr. De Datta said.

“But the world has moved and the expectations of the consumer has changed significantly and mobile has of course changed that,” he said.

The evolution is apparent in terms of consumer expectations by apps such as Uber, with users quickly getting frustrated when the app informs them that a car is 7 minutes away and it ends up being 11 minutes out.

“That’s the level of expectation we now have,” Mr. De Datta said. “It is a becoming a consumer-centric, mobile-centric world.

Webrooming vs. showrooming
The executive recommends retailers be more concerned about Webrooming as opposed to showrooming.

“I should be less worried about the one interaction I have with my customer every quarter in the store versus the 15 interactions I am going to have with them online between now and then,” Mr. De Datta said. “That ought to be the relative level of investment because that is the relative investment of consumer attention that is going on.

“We know that shopping starts on mobile, ends on mobile and mobile is all across the board,” he said.

One of the challenges retailers face is that, in a Web context, only 5 percent of people are going to log in. This makes it challenging to know who they are.

To address the challenge, instead of hiring as many data scientists as Amazon does to work on the problem, Mr. De Datta recommends starting with the five or six things that really matter to a consumer that can be stitched across a singular experience that transcends all channels.

Apps. vs. mobile Web
He also suggests retailers stop thinking in terms of apps versus the mobile Web, as each has evolved to serve a very specific purpose.

“In a lot of ways, the Web has become the new customer acquisition channel, the app has become the retention channel – the use cases are fundamentally different,” Mr. De Datta said.

“Perhaps the way to think about the app is that the app is the future of your loyalty program and the Web is the future your sales rep,” he said.

To get started on creating more unified experiences, the executive suggests unifying store and phone experiences, understanding that personalization has to span multiple devices as well as providing a single view of fulfillment and deals.

However, perhaps the most important step to take is to measure business success in fundamentally different ways.

For example, one of BloomReach’s customers is moving towards having a single unified customer-facing front, with one general manager across the board and two profit and loss statements segmented by customer and product.

Another retailer did away with channel-based marketing by moving to regional marketing, with customers shop offline and online grouped together by geographic region.

“We really have to rethink our organizations to hit this combined experience,” Mr. De Datta said.

Final Take

 

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