Retailers and brands have both seen a tremendous shift in traditional retail dynamics, with merchants and marketplaces increasingly ceding control of the online and in-store shopping experience to the brands themselves. Democratizing access to data through new verticalized tools, however, represents a unique opportunity for retailers to leverage this trend by further transforming the retail dynamic and changing their role in the process.
Marketplaces and third-party sellers have always represented a kind of data “blind spot” for brands. Both provided little visibility on customers and even less control over customer experience or satisfaction.
Verticalized tools that provide new levels of data access are changing all that. For example, b8ta is offering a Retail-as-a-Service model and software platform to brands and retailers to better manage and analyze their in-store experience. Companies like Chatter Research are capturing real-time customer feedback that can be integrated side-by-side with POS data to further improve store performance. Solutions like these enable both parties to collaborate and give brands a unified omnichannel strategy. It also provides retailers with a unique opportunity to rethink their purpose and elevate their value proposition within the retail ecosystem, while also expanding margins and driving potential new revenue streams.
Brands already own the entire customer experience through their O&O stores and e-commerce sites. Amazon has also started providing access to more robust customer and sales information through their API. This has encouraged brands to build internal expertise while increasing their desire to have greater insight into — and control over — the sales process. The impetus now is on third-party retailers and marketplaces to provide similar (or better) opportunities and insight to match what O&O and e-commerce sites now provide.
The democratization of data access is a rare bit of good news.
Retailers are already shifting their focus to product discovery, search and transaction. They are more focused on ensuring a positive, in-store user experience — from processing a transaction (the global retail automation industry is expected to reach $21 billion by 2024) to finding and purchasing the product and accelerating conversions. These shifts, coupled with increased data visibility and analysis, fundamentally alter the value proposition for the retailer.
Platforms — like the above-mentioned b8ta and Chatter Research — allow retailers to capture data and provide it to brands so that they can ultimately be smarter about marketing and promoting through tracking customer visits, interactions and transactions. Soon, smart retailers will leverage this data access to an even greater degree, as brands increasingly rely on third-party retailers/marketplaces to grow their sales and market share. Retailers will sell it directly to brands using data marketplaces or use it to negotiate more favorable terms with product supply.
There are derivative benefits for retailers, as well. As more verticalized tools are deployed and adopted by both brands and retailers, they will continue to marry transactional data with user behavioral data while mapping consumer identification to brand marketing activity. Once the data is properly analyzed it will increase not only revenue per square foot but product margins in physical stores, as well, by helping retailers identify and recover lost sales. It also will lead to incremental investment by brands in shopper marketing, transforming advertising into selling.
The data holistically makes retailers stronger.
As merchants and third-party sellers struggle to reverse years of decline, the democratization of data access is a rare bit of good news. It changes the economics for all stakeholders involved, alters the roles of brands and merchants and creates new, much-needed monetization opportunities for retailers. Unlocking the value of data and empowering brands with it allows retailers to focus on where they can make the highest impact. While roles will change, data connectivity will ultimately strengthen partnerships and improve outcomes for all.
Revel Partners has published a white paper on retail, the brand-direct economy and the impact of data on retail efficacy and consumer satisfaction. To view it in its entirety click here.
Source: Tech Crunch