Could the secrets to more effective marketing strategies
be lying right in your stores?
How well do you know your customers? I mean really know them. How often do they come in? What do they do while they are in your stores? What services do they buy? Who are the most profitable? Who are the least loyal or infrequent users?
I think you would agree that if you had the answers to these questions and many more like them, you would have a huge advantage in developing marketing strategies that would be likely to yield more productive results. The answers may not be as out of reach as you think. In fact, many of them may already be in your transaction data.
Many retailers have come to understand that the value of their transaction data lies in the ability to connect it to the customer. Not just to total daily transaction activity, or to fulfill accounting and compliance requirements, but to also be able to connect all of those transactions to the actual people who performed them – both customers and staff. Being able to connect customers to their cash register receipts is what gave birth to the dozens of loyalty card programs that offer “member-only” discounts or special offers only to registered cardholders who present their cards at checkout. Previously anonymous grocery or general merchandise purchases at big box stores or pharmacies were now able to be connected to the actual person making the purchase.
Financial services transactions by their very nature are data-rich with details about the customer. Their name, address, phone numbers, email, physical description, signature sample, banking information and more is routinely collected as part of the onboarding process of a new customer, and then if done correctly, every transaction could, or should be associated with that person.
While all this information may have been captured by your POS or Loan Management system, have you really studied it with regard to the marketing insights that can be mined from that data? If you do, you will realize that you have a variety of customer types or segments, each with identifiable patterns of behavior. If your marketing efforts are targeted to those behavior patterns, they will be more effective in the results they achieve due to their relevance to each segments’ unique needs and behaviors. For example, how many of your customers came in to cash a check at your store and never came back again after the initial sign-up process? If you are like the typical FSC, it’s likely to be nearly half! That’s right, between 40%-50% of the consumers in a variety of FSC databases I have personally studied usually reveals there are this many one-and-done customers lurking in the database. If a marketing campaign targeting this easily identifiable segment of your customers could get just one in ten to cash one more check, you would experience a 4% to 5% gain in check- cashing fees from that effort.
What about your front-line employees? They are your salesforce. Is their proficiency ever really measured? Each signs onto the POS system at the start of their shift, and every transaction they process is associated to them. But how do they compare to each other with regard to metrics such as transactions processed per hour worked, or fee revenue generated per hour, ancillary products sold, etc. These are all easily measured Key Performance Indicators (KPIs) that can be rolled up into marketing or sales dashboards that can be reviewed at regular intervals to better manage your business. Like the old adage goes, you can’t manage what you can’t measure. All of this and more is lying in your transaction data, waiting to be put to work.
But what lies beyond the transactions? Do you know how many customers walk through your doors every day? Does everyone make a transaction? Where do they go in the store and what do they do at each of these places?
Are there self-service zones for ATMs, coin counters, copiers or other such devices? Do they use writing counters to complete applications, sign checks or perform other activities? Are there other ways to interact with
them to share product information, take surveys or solicit feedback?
Progressive retailers today are using infrared sensors to capture traffic data, product interaction, dwell times and other such activity to better understand how the customer interacts with the retail space, so that we
might better communicate with them in each of these zones and improve the overall experience of their visit … you know, that WOW moment we’ve all had at one time or another and never forget.
Armed with the intelligence of how your customers interact with your retail environment, and how that interaction ties back to their transaction behavior, you can plan very intelligent path-to-purchase strategies that
will enhance their experience with you, and more likely their loyalty as well – all while you improve your chances to sell them more per visit and increase their overall value as a customer.
I like to refer to this type of strategy as creating a “Smart Store,” that is one that can capture and, with the right tools, report critical business data back to you to help make better staffing, retail environment, advertising and
promotional decisions, resulting in increased sales. Because you see, not all marketing is about creative strategies and cool graphics. There is a science side to it as well, and when you put that to work for you, it results in marketing decisions that are fact-based, not just unproven hunches or theories.