4 consumer data types retail enterprises should prioritize
We all know how important data is to help make intelligent business decisions and improve customer service and marketing.
In general, there are four types of customer data to collect, each playing a unique role in understanding your audiences better. These data types help you personalize customer experiences and stand out from the competition.
This article will explore the four customer data types that your retail enterprise should prioritize and how to leverage them to drive business success.
What is consumer data in retail?
Consumer data in retail is information collected and analyzed about individual customers or groups of customers who engage with a retail business.
Let’s explore the different types of data in more detail . . .
4 types of consumer data for retail enterprises
The four customer data types we’ll look at are: identity, transactional, behavioral, and social. These data types are the most relevant and what you should be focusing on to enhance your marketing campaigns and understand your customer base.
1. Identity data
This is personal information about customers, such as names, addresses, contact details, and demographic attributes. Use this data to personalize marketing messages and promotions, and improve customer segmentation and targeting.
2. Transactional data
Transactional data refers to information related to customer purchases and interactions, including previous purchases, order history, average transaction value, and frequency of transactions.
Transactional data helps you to answer key questions about your business and customers, understand customer purchase behavior and history, and identify popular products or services to inform inventory management
3. Behavioral data
Behavioral data tracks customers’ actions and interactions with retail brands across various touchpoints. It includes data on website browsing behavior, product views, cart abandonment rates, click-through rates, and responses to marketing campaigns.
During the analysis of behavioral data, you should ask the following questions to extract the most value:
- How recently did a specific customer make a purchase?
- How frequently does this customer purchase compared to other customers?
- Are there any consistent patterns in customer interactions before they make a purchase?
4. Social data
Social data is information obtained from a social media platform, including customer reviews, comments, likes, shares, and social media interactions. This data helps with social media audience segmentation, allowing you to identify and categorize audiences based on social media behaviors, interests, and demographics.
When it comes to social data, start by considering:
- Trending topics and conversations: Look for patterns in hashtags, mentions, or keywords related to your industry or brand. By understanding what topics are currently popular or generating significant engagement, you can tailor your content, join relevant conversations, and leverage these trends to increase brand visibility and engagement.
- Competitive analysis: Social data analysis can offer insights into your competitors’ activities and industry trends. Monitor your competitors’ social media presence, engagement metrics, and content strategies to identify patterns and trends that may impact your own business.
Consumer data applications in retail
1. Audience targeting
Audience targeting is a key application of consumer data in the retail industry.
Taking a close look at the various types of consumer data, such as demographic information, purchasing behavior, and browsing patterns, allows you to segment your audience and target specific customer segments with personalized marketing campaigns.
You can use tools like Audiense to discover powerful insights about your audience, whether it’s their digital habits or their likes and dislikes. This approach ensures your marketing efforts are directed towards the right audience, increasing the likelihood of customer engagement and conversion.
For instance, Starbucks gathers data through its digital rewards scheme and mobile app, enabling the company to market specific products and features individually. As a result, customers feel that they have a more direct relationship with the brand, and Starbucks can make better decisions when it comes to new store locations or products.
2. Price optimization
Price optimization is another crucial application of consumer data in retail. Transactional data, including market trends and competitive pricing information, prompts optimal pricing strategies for your products.
Integrated payment systems play a vital role in this process. Providing retailers with real-time access to transactional data it promotes a deeper understanding of customer purchasing behavior and preferences. Use this customer data to adjust prices to maximize profitability and competitiveness while still meeting customer expectations.
As an example, Walmart uses a price mapping strategy to analyze its prices against competitors and adjust them when needed. This data indicates the price most customers are willing to pay. Meanwhile, transactional data shows which products are not selling, so that Walmart can offer discounts on those lines.
3. Improving customer satisfaction
Personalized recommendations, customized promotions, and enhanced customer support based on consumer data insights contribute to higher levels of customer satisfaction and foster long-term customer loyalty.
Amazon is highly successful at getting to know its customers’ preferences and making tailored recommendations. It uses behavioral data based on past purchases and browsing activity, and recommends products the customer is likely to enjoy, increasing customer satisfaction and making their next purchase easier to find.
4. Streamlining operations
Operational data analysis pinpoints bottlenecks, inefficiencies, and areas for improvement in the supply chain, inventory management, and fulfillment processes. Keeping close track of consumer data like purchasing patterns and demand forecasting helps optimize inventory levels and reduce the likelihood of stockouts.
The Wegmans supermarket chain figured out that the best way to streamline operations was to control the whole distribution process themselves. As well as collecting consumer data, they sync it with local and national suppliers to ensure that their stores never run low on key items.
Similar logic can also be applied across other elements of your business. Whether it’s combining your finance data with your marketing data to better determine your budget or using an online payslips software that feeds data to your accounting software to improve your payroll process.
Ultimately, by considering how you can leverage the data available to you, you’ll be able to streamline processes and make your entire operation more efficient
Optimizing different customer data types for your business
It’s no secret that consumer data plays a critical role in the success of your retail enterprise.
By harnessing the power of identity, transactional, behavioral, and social data, your organization can gain valuable insights into your customers’ preferences, behaviors, and interactions.
This data, in turn, facilitates personalized marketing messages, improves customer segmentation, optimizes pricing strategies, and enhances overall customer satisfaction.
Ultimately, helping you make better decisions, will make your business more efficient and improve your customer’s experience!