Digital Marketing

Cracking the Consumer Code: Digital Age & New Technologies

Digital Marketing - The Digital Essentials, Part 1
The Digital Essentials, Part 1

A compelling digital strategy aligns customer experiences, business execution, and the right technology as the market and your competition constantly evolve. Our Digital Essentials highlight the most compelling aspects of all three to help you react and respond to this ongoing evolution.

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Leading companies are examining the ways that they engage consumers through emerging digital channels.  Analysis of engagement data is imperative to truly understand the people they are targeting.  Building brand loyalty and fostering repeat sales hinge upon the creation and maintenance of meaningful relationships between consumers and the companies that serve them.
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New technologies have enabled the digital channel to become a prominent channel for consumers. Is there any need for brick and mortar in the age of the digitally connected consumer? 
MF:  I want to reflect back fifteen years ago to when the digital age was really in its infancy. There was a prediction for disintermediation, otherwise known as “cutting off the middle man.” Although Webvan failed to disintermediate the supermarket industry, chains like Safeway have launched their own delivery services, targeting the niche market to which Webvan catered. There are plenty of other examples where we can now go online to buy the products that we want, any time we please.
Does this mean the store is dead? I really don’t think so. However, stores will have to adapt to an evolving “bricks and clicks” model, which recognizes the connected consumers’ ability to determine a particular path to purchase. Already we can see the evidence of this in the abandonment of some shopping malls across the country, as well as a consumer trend towards showrooming.  But even showrooming is not the “end of days.” It just suggests that consumers sometimes now want to touch and feel and then look for value, or the reverse, before completing the purchase cycle. The key for any retailer is going to be identifying where it, and the consumer, stands in that path-to-purchase and then making the kinds of observations and offers that can close the deal.
The digital age and new technologies have enabled companies to collect more consumer data at a much faster rate. To keep the consumer at the center, companies are collecting, tracking, parsing, analyzing and ranking data to better personalize the consumer experience.  With concerns about the “big brother” nature of data collection, what is the consumer really getting from his or her supposedly volunteered and private disclosures?
MF: I think the concern is well justified, and already consumer watchdog groups are forming to challenge practices that might abridge our right to privacy. As an example, I recently read a story about a new technology that can remotely switch off your car if you haven’t made a payment on time or have strayed outside the agreed confines of a predetermined geography. I actually find this quite disturbing. Similarly, I heard someone recently joke while speaking at a conference, “You’re on the grid. You’re known through and through. Get over it!” Really?
Today there are innumerable of ways to know where we are and what we’re purchasing, even what we are thinking which we readily give up in our Facebook posts. But I do think, in a free economy anyway, that this conversation is going to take on a great deal of meaning in the coming years.
All that said, when we opt-in, and when our privacy and security are ensured, we do get something special in the form of optimized services that benefit us. Our job, as objective consultants, should be not just to offer technical solutions for our clients’ consideration, but to have leaning in conversations designed to provide a more comprehensive understanding of what “trust” actually means including how, once earned, it must be constantly won and vigorously supported. This means exploring various options with our clients that go beyond technology for its own sake; addressing the needs of today’s connected consumer in a way that respects them while simultaneously serving them.
Personalizing the customer experience has become crucial for retailers and consumer products companies to stay competitive and is playing an increasingly larger role in the creation and management of loyalty/rewards programs overall. But are loyalty programs, themselves, crucial to customer engagement?
MF: Frequent shopper programs provide “Pavlovian” rewards for loyalty, but that’s not the sum total of what they do or were designed to do. Rewards are great, and we all love them, but consumer engagement goes much deeper, often concerning itself with the recognition of need states through more intimate contact.  For example, an airliner should be cognizant of traveler’s needs for extra legroom and in-flight food preferences. It should know whether I prefer an aisle or a window seat, keep track of my bags and alert me if they or I are going to be delayed. For frequent fliers, the instantaneous transmission of information to a mobile phone can be helpful in ways that surpass expectations. But that’s the rub, because expectations are always increasing.
Many retailers, and a good number of manufacturers, have truly begun to grasp the idea of what it means to sell not only what they make, service or stock but what you –the connected consumer wants– when you want it, how you want it!  This new definition of relationship, with the attendant need for a more tailored customer experience, is never static and is always evolving. It’s not dependent on a loyalty program, but the latter can certainly benefit from it.
Hail the consumer!
Jim Hertzfeld is off this week.

About the Author

Jim Hertzfeld is Principal and Chief Strategist for Perficient, and works with clients to make their customers and shareholders happy through insanely great digital experiences.

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