Big Data’s big impact: Personalized shopping experiences

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Big data is having a big impact on retail in part because it’s helping retailers of all sizes offer personalized shopping experiences. No longer is personalization just a facet of the luxury or mom-and-pop experience. With big data in-hand, all retailers can now make shoppers feel special… and of course help them spend a bit more.

It always helps when a sales associate gets your style and recommends pieces that make you feel like a rockstar. Who wouldn’t buy a bit more if that was the experience they had every time they stepped into a store or clicked onto an ecommerce site? Retailers are now trying this on for size both online and in-store. Two retailers who are really getting it right are Birchbox and Harrods.

How Subscription Leads to Loyalty

Birchbox is a beauty product subscription service launched in 2010 that sends monthly boxes with different types of samples and presents the opportunity to buy the ones that subscribers like. A great way of thinking about it is like an on-going brand exploration. One of Birchbox’s Co-Founders coined it as the “try, learn, buy” model.

Since Birchbox started as an online only retailer, it already knew how to use data to personalize offers and increase sales. Online subscribers enter in personal data like skin tone, hair color, and style preferences to determine what they receive each month. This data also helps drive product recommendations in their brick and mortar store in Manhattan’s SoHo.

In the store, customers have the ability to see samples up close before deciding to put it into their box. Birchbox uses iPads throughout the store and even has a big touchscreen “Product Matchmaker” to make personalized recommendations.

The importance of data to Birchbox’s model can’t be understated. Being able to provide targeted products each month and suggestions in-store make it a highly personal brand that effectively makes each shopper feel special. Birchbox is like a friend who really gets what you like and that is worth a lot. These micro purchases can easily lead to loyalty that lasts a lifetime.

Displays for the Win

The second retailer that is making waves with its use of data is London-based luxury department store, Harrods. From gamification to in-store displays, this retailer is really pulling out all the stops to see what is most effective at driving sales.

The retailer recently used technology to promote a new Polo Ralph Lauren line for women. It set up 15 window displays that featured interactive maps of the “Fashion Lab” where shoppers could find the new collection while in-store. It even took early birds and night owls who interacted with the display into account by giving the option to purchase from the collection right then and there on their mobile devices. These displays were highly effective, as 15% of shoppers made a purchase online.

Last month at Retail’s Big Show, Harrods’ Media Sales Director, Guy Cheston, broke it down. He explained, “Digital gives us a new realm to play in and enables us to add excitement through using various digital platforms. It influences how we create content and distribute it. We create what our customers want to engage with.” This new take on technology and personalization has helped Harrods attract a younger audience and this is especially important as millennials continue gaining spending power.

What Retailers Need to Work on

Big data has the potential to really change the way that shoppers and retailers interact. Both Birchbox and Harrods are glowing examples of how effective personalization efforts are. Let shoppers tell you what they want and take the driver’s seat in the overall experience. Keep track of their preferences to consistently deliver exactly what they want because a retailer that successfully makes a one-on-one connection in each interaction will always sell more.

Martin Good / Shutterstock.com

Angelica Valentine
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February 27, 2015
Angelica Valentine

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