One guy actually got mad at me, thinking I was messing with him. The rest had a more resigned reaction: outside the share of customers you might have in a loyalty program, there wasn’t a way to truly tick and tie customer behavior across channels.
But things are changing rapidly.
Even though a decade has past since most retailers became multichannel, the majority still don’t have a good way to track customers across channels. One of the biggest problems is the offline “data hole.” Where online transactions require customers to identify themselves, the same is not true offline. Even when not paying by cash (still 27% of transactions according to Javelin Research), since many credit card providers won’t share data with merchants.
And even where data is available, retailers typically lack a “primary key” – a common identifier that can be used to tie offline activity and online activity to a single profile.
So what’s changing to potentially close the multichannel data gap? A dramatic convergence of the online/offline payments spaces.
PayPal and Square are getting the most attention. The former’s rollout across Home Depot’s stores looks to be quickly imitated by others (e.g. McDonald’s). And Square’s take-over of Starbucks’ point of sale may create a wave of imitators looking to mirror what promises to be a leap forward for a customer’s in-store experience.
Hot on their heels comes Google (with it’s mobile wallet), Apple (its devices already replacing traditional POS even as iTunes installed base makes it a potent “wallet” contender), and most recently a group of retailers led by Wal-Mart and Target announced their intent to push their own wallet solution.
The net of this is retailers will increasingly be able to tie offline consumers to their purchases. Identity is core to Square’s payment system (your photo and last order will pop-up on the Barista’s screen when you enter the store). And even where exposed identity is less central to the particular payment system, undoubtedly every retailer will demand meaningful data access as a condition for adoption.
The result will be a revelation for many retailers. Not just in terms of better CRM, but also in terms of the clarity it will bring to the offline impact of online marketing (and direct mail). Of course not everyone may be happy with the corresponding visibility. Undoubtedly there will be winners and losers as credit for sales gets reapportioned within marketing departments.
Consumers will need to benefit too, or the party will be shut down before it even begins. A readily accessible crosschannel purchase history will be a useful tool for the consumer, particularly in categories like apparel, grocery, and electronics (no more guessing which accessories, add-ons, or batteries are the right ones). And the kind of recognition engendered in the Starbucks-Square tie-up is bound to be a hit with many. Accompanied by proper permissions and opt-ins, consumers have continually proven willing to give – in order to get.
The upending of the current payment/POS structure will be revolutionary rather than just evolutionary. It’s coming on extremely fast and we should expect to see a crosschannel customer view as one of the prominent byproducts of the coming together of online, offline, and mobile payments.
Richard Harris is co-founder and CEO of Intent Media.