Salesforce has released a report, “Trends in Retail and Consumer Goods Marketing.” The report shares the biggest trends in retail and consumer goods marketing in 2019. It is based on a survey of nearly 900 retail and consumer goods marketers worldwide.
The report found:
- Cross-functional dynamics are shifting to satisfy customer and business demands.
- Data is transforming the way marketers operate.
- Personalisation is becoming more refined at the crossroads of intelligence and trust.
- New standards of engagement are inspiring and challenging marketers.
Marketing is the glue of customer experience
According to the research, marketing departments are increasingly responsible for driving innovation in customer experience. In fact, 40% of retail and consumer goods marketers are leading customer experience initiatives. This is up from 24% in 2017.
In a rising number of organisations, marketing is the department bringing together cross-functional teams to deliver the seamless and personalised experiences shoppers demand across touchpoints. More than half (51%) of retail and consumer goods marketers are actively mapping the entire customer journey. Companies are analysing when customers see an ad to when they place an order to when they return for service. Retail and consumer marketers share common goals and metrics with their companies’ advertising and service teams (62% and 53%, respectively). Slightly fewer (51%) do so with their commerce counterparts.
Struggling to balance personalisation and privacy
The report notes that Artificial Intelligence (AI) can predict which products shoppers will want and deliver personalised interactions. This drives major revenue — for example, during the 2018 holiday season, AI-powered recommendations yielded 14% higher average order value. Retail and consumer goods companies are taking note. The study found that, 25% of retail and consumer goods marketers are leveraging some form of artificial intelligence today. That figure is projected to grow to 70% over the next two years (a 176% increase).
While AI and data are critical for meeting shoppers’ elevated expectations, data privacy and customer trust must also be top of mind. Eighty percent of retail and consumer goods marketers say balancing privacy and personalisation is a priority. However, only 28% of them are completely satisfied with their ability to do this. For marketers to truly reap the benefits of data, clear privacy policies are tantamount. The lesson? You can’t have a truly engaging, sustainable relationship with your customers without trust.
Real-time engagement is a goal, not a reality
The report suggests marketers emphasis the need for engaging customers in real time for years. Yet today, very few marketers are actually able to communicate a unique message to customers based on their last action or engagement with a brand.
Over one-quarter (27%) of retail and consumer goods marketers describe their channel coordination as generally siloed. Thirty-three percent describe it as dynamically coordinated — when messages evolve across channels based on customer actions. The rest (40%) say their customer-facing channels feature duplicate messaging — identical messages broadcast across channels.
In an omni-channel world, the gold standard is dynamic, not duplicate, conversations between customers and brands. Channels with the highest rates of duplicate messaging are banner ads, social advertising, and mobile apps (42%, 41%, and 41%).
Modern marketing requires sensitivity to context about where, when, and how consumers are interacting with the brand. For example, a push notification right outside a store should be different than the notification a customer gets at home. Even if it’s for the same product. In the move from mass marketing to personalisation, marketers are making progress in creating content across channels consistently. However, most (67%) are still not personalising messages in a truly contextual way.
To make contextual conversation more complex, retail and consumer goods leaders manage a long and growing list of marketing channels. The average retail and consumer goods marketer uses eight channels, and expects to use 13 next year. Voice technology is especially poised for growth over the next 12 months, with a projected growth rate of 127%. Virtual Reality and Augmented Reality is expected to achieve higher growth by 218%.
Data unification is now top priority
Shoppers have ample choice of where to fill their carts. Marketplaces, brick-and-mortar stores, digitally native pureplay brands. Their preferences can be a moving target. Retailers are turning to more data sources to understand customers’ unique wants and how to retain their loyalty over time. The problem is that marketers struggle to unify all that data. The number of data sources that retail and consumer goods marketers use grew to 16 in 2018. This is up from 10 in 2017 (a 60% increase).
With many data sources, 49% of retail and consumer marketers report having a completely unified view of customer data sources. Clean and normalised consumer data — across the growing number of sources — is a critical foundation for personalised engagement. Data management platforms (DMPs) are becoming an increasingly popular tool for unifying customer identity across disparate data sources. Fifty-five percent of retail and consumer goods marketers use a DMP today.
Enterprise Times: What this means for business?
Shopping has ceased to be defined by the boundaries of brick-and-mortar. Consumers expect brands to meet them wherever they are. They expect an experience tailored to their individual needs across the entire shopping journey.
Despite the pressure many retailers face to achieve revenues retailers must compete on experience. The alternative is the bottom line driven down by promo codes and free shipping.
Retail and consumer goods marketers are on the front lines of creating those memorable, not purely transactional, experiences. The retail renaissance is in full swing, and this research shows that retail and consumer marketers are up for the challenge.