How To Survive The Holiday Season: Become Your Customer’s Best Friend

Jul 29, 2014 9:44 PM  By

As consumers cash-in on end-of-summer sales, retailers are shifting gears in preparation for the most crucial shopping period of the year – the holidays. Preparing for the holidays is not just about extending store hours and hiring extra retail staffers. Successful retailers need to build a relationship with their customers now so they are primed to make those purchases come holiday shopping time. For those retailers looking to score big this holiday season and beyond, it’s all about personalization, engaging customer experiences, and of course, mobile.

Last holiday season, online retailers focused on streamlining the shopping experience so consumers could more easily find what they were looking for.  Retailers prioritized improving ease of use in the hopes of inspiring loyalty and trust in their customer and convincing them to click “buy.”

This led consumers to drop even more items into their checkout carts, according to data from IBM’s Seventh Annual Online Retail Holiday Readiness Report. The numbers showed that average order value (AOV) and items per order both reached new three-year highs, with AOV jumping nine percent in November 2013 versus two years ago.

So how can retailers build on this momentum? By taking the customer relationship one step further and getting inside the customer’s inner circle of trust as one of their “best friend brands.”

Becoming a Best Friend Brand

Today’s customer expects their interactions with retailers to be more personal and relevant than ever before – valuing an individual, concierge-type interaction over a one-size-fits-all approach. Recent research revealed that most consumers prioritize brand relationships much like relationships in their personal life, with some being especially close and important. The study, conducted by Silverpop, an IBM company, found that consumers have five ‘Best Friend Brand’ companies from which they repeatedly open emails and purchase products or services.

Remember that old adage “treat others as you want to be treated?” Well, by offering your customers the “best friend” treatment, they are likely to treat you the same way in return – opening your communications, browsing your site and ultimately bringing increased business. With dwindling customer attention spans – retailers saw average time on site sink to a new low in September 2013 of just 7:09 minutes, about a minute less than was recorded two years earlier – it’s now more important than ever to make sure customers are coming to you instead of your competitors this holiday season.

The brands that make their way to coveted “best friend” status don’t do so with spray-and-pray marketing tactics. They do it by providing relevant personalized customer experiences year-round. Becoming a trusted brand doesn’t start on Black Friday or Cyber Monday – it should be a year-round effort. While marketers are busy and often consumed by competing with other brands for attention, it’s critical for them to remember their marketing communications need to be just right to reach “best friend” status and ultimately drive more marketing-sourced revenue.

Santa’s Little Helper, Analytics

If you knew your customers as well as their family and friends, you would know their needs and interests and be able to serve up a perfectly personalized shopping experience. You’d have a pretty good idea of what would make the ideal holiday gift, too. Part of being a “best friend” brand is moving beyond knowing simple customer demographics, but really understanding their behavior and how this affects their purchase path. Most marketers will never get the opportunity to get up close and personal with every customer, but through analytics, they can come pretty close.

Take for example, how analytics can improve the mobile customer experience. The IBM Digital Analytics Benchmark is predicting that mobile will continue its steady march to dominate online shopping with 43% of all online traffic coming from mobile devices and 20% of all online sales coming from mobile devices.  With the help of advanced analytics, marketers can not only see how customers are engaging through mobile devices, but they can also stay on top of the constant fluctuations in mobile usage as new devices and operating platforms emerge. Marketers can go beyond analytics of mobile traffic and sales to identify and explore the “why” behind mobile application failures, usability issues or other obstacles that lead to failed transactions, abandonment, poor app store rankings and negative feedback. There are powerful ad hoc discovery and segmentation tools that can allow marketers to quickly find and isolate problems within mobile customer experience for both individual customers and in aggregate.

The Gift That Keeps On Giving

Turning aggregate and individual customer insights into action is the hard work that lands brands the coveted “best friend” status.  Retailers must deliver high-quality, engaging experiences throughout the holiday season.  “Best friend” brands sweeten their customer engagements with early access to merchandise, premium content, special discounts, exclusive sales and other perks.

Instead of focusing solely on selling to their customers, “best friend” brands also make sure to meet other customer needs. They provide resources like in-store Wi-Fi, answer shoppers questions via social media, offer price comparison tools and provide customers with other perks to help sweeten their customer interactions. During the hectic holiday season, the retailer that goes above and beyond is the brand who will be remembered as a best friend.

As shopping on retail websites continues to grow at a double-digit pace, the 2014 holiday season could play out to be a prosperous one for U.S. online retailers. Soaring usage of smartphones and tablets has made online shopping accessible to consumers anytime, anywhere, but the brands that successfully become their customers’ “best friends” are the brands who will enjoy a very merry holiday shopping season.

By personalizing each customer interaction, engaging with their customers at every touch and leveraging analytics to not only understand how customers are behaving, but why, retailers will position themselves for success – this holiday season and beyond.

Jay Henderson is Strategy Director for IBM ExperienceOne.