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Welcome, Retail! Customer Focus is Waiting

Posted on  13 April 10  by 

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Shopping BagsSo perhaps the title here is a bit harsh, but something needed to catch your eye. We’ve long known retailers to be a unique beast, managing more products than any CPG marketer could imagine, focusing on category-specific merchandising strategies (often to the detriment of cross-sell), and most recently, managing the tradeoffs between brick-and-mortar stores and online sales.

But frankly, this too often turns retailers into myopic, proximity-biased incrementalists in their customer strategy (too harsh again?). Imagine my encouragement when I see retail CMOs begin to tout the very elements of customer-focused strategy their CPG peers have long known.

This new focus on the customer take two forms: organizational structure and marketing communications execution. Take Express, for instance. Organizationally, Express CMO Lisa Gavales (follow her on Twitter here) now owns all e-commerce activity. From a communications perspective, every touchpoint – be it on the store floor or the web homepage – displays the same visual branding. Express is Express, no matter where the customer encounters it. While a recent development at Express, MLC research would clearly indicate that customer-focused, channel-agnostic marketing communications will yield far higher returns to the whole portfolio than category- or channel-specific campaigns.

At Macy’s, you practically have CMO Peter Sachse committing marketing treason, saying, “What we don’t need to do is get new customers.” Yet he’s right, because he too has placed the customer at the forefront of marketing’s strategy, rather than a distant second to classic merchandising techniques. And what better way to do this than. . .wait for it. . .asking the customer! Sifting through NPD Group data, interviewing shoppers as they left the store, all in an effort to generate customer centricity. Much like Express, the end result is an inevitable broadening of Marketing’s scope of control (which of course we as marketers enjoy). Sachse states specifically that the web should be the brand’s hub, which can lead to innovative uses of the web as a marketing communications vehicle, as in this recent Macy’s campaign.

Yet for many retailers, the transition to a customer-driven marketing organization may not be as simple as having charismatic leaders like Gavales and Sachse. That’s where MLC research can help build the business case for customer focus:

  • See how Tesco created an annual customer plan to implement improvements to the shopping experience grounded in customer insight.
  • Read how Food Lion co-opted cross-functional partners by pre-committing them to next steps on customer-focused projects.
  • See how Victoria’s Secret filters all customer-focused investments to ensure alignment with the brand and target customer.

The trend toward customer focus in retail is more urgent and necessary than ever before, as the sector seeks to reinvent its offering coming out of the recession. Those that fall behind in satisfying customers’ needs will likely get trampled in the next Black Friday rush.

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