photokina: 26.–29.09.2018 08.–11.05.2019

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On the right journey with the customer

Targeted information instead of annoying mass emails: Companies can increase willingness to buy by using consumer information in a targeted way. Customer relationship management programs play a vital role in this by merging individual data streams.

Knowing today what the customer will want tomorrow: That is the goal of more and more companies. This is how they can address the consumer in a targeted way – traditional advertising such as mailings or flyers does not work anymore because of the enormous competition both online and offline. The goal: Users should be addressed in a targeted, personal manner and receive helpful information in the process. The conditions are good: Many users willingly leave behind traces and data on the internet that help with the necessary analysis. However, companies have to change their IT in order to sort through the growing volume of information to deliver the appropriate email offer, the correct push notification in the app or the compelling discount code on the homepage for each individual customer.

Software solutions that process such data are now commonplace in many companies. Thanks to online shops and customer accounts, an increasing amount of information is being collected about buyers – who they are, how they find their way to the retailer, what they are looking for – as well as what they put in the shopping carts but end up not purchasing. Gathering, sorting and evaluating this data is the task of customer relationship management (CRM) systems.

The task: To be able to address each customer individually, via their preferred channel and with the product they are currently interested in. One example of this is retargeting: A user who has looked at a product in the online shop but not yet bought it will later receive advertising for the same product on a social network or by email – perhaps even with a small discount to provide an additional incentive.

Small and large software manufacturers are facing a booming demand: According to the US market research company Gartner, CRM systems are the fastest growing segment of enterprise software. “The managers responsible for customer relationships continue to invest in digital technologies,” write the market researchers in a study.

Many possibilities thanks to data linking

In order to address customers individually, not only do retailers need a great deal of information about them, they also have to link it correctly. The number of data interfaces to each individual customer is constantly growing because communication takes place via more channels. Only if all this information comes together in one place can it be evaluated in a meaningful way by the software and converted into offers.

This requires recognizing patterns in the behavior of customers in order to derive the best possible approach. This means that someone who has made purchases in the morning so far will also receive an email with offers in the morning. Someone who likes to shop with their smartphone will be addressed differently than someone who would rather sit in front of a stationary computer. And a customer who has already bought something after clicking on an Instagram advertisement, for example, will continue to receive offers there.

Ideally, the CRM system helps to accompany every single customer individually along the digital journey and offer them compatible products via their preferred channel. Only in the first step is it a matter of extending existing interests into the future: People who have already bought books or designer fashions will most likely continue to be interested in such things. The data should also enable predictions: If someone just bought a coffee machine, they will need coffee pads tomorrow. Someone who buys diapers today will need toys in the near future and a schoolbag in six years. Someone who bought skiing gloves in the winter may want hiking boots when the weather gets better.

A tremendous amount of computing power is needed to evaluate the enormous volumes of data. That is why the trend is towards cloud-based CRM solutions – meaning programs that do not run in the company’s own IT systems, but rather leased from providers who offer software-as-a-service. According to a study, more than 80 percent of CRM softwares were still running on local computers in 2008, whereas today the reverse is true.

The high performance software is even able to incorporate real-time data, such as from social networks or other sources, into the forecast. Consequently, solutions for CRM and big data are coming together more and more. Even information about the weather, regional events or statistical surveys on demographics or income can be included in the decision of which product the company offers to which customer and on which channel.