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How Smart Brands Handle Personalization in Retail

Personalization is one of the most effective ways for retailers to reach customers and drive conversions. Equally obvious statements include 1 +1 = 2, the sky is blue, and babies and puppies are super cute.

A man and woman using personalization in retail to provide a superior customer experience. 
Today's customers want personalization in retail, not just low prices.

In all seriousness, personalization in retail isn't a new concept. For more than a decade, brands have invested in marketing automation platforms and experimented with ways to personalize emails, product recommendations, discount offers, and even product packaging. How can you not get a little thrill when you find a Coca-Cola bottle with your name on it?

However, it's no longer enough to personalize content for individual customers and buyer personas. Forward-thinking retailers are personalizing experiences. They're making smart investments in technology that can help them retain customers by delivering a seamless, personalized omnichannel retail experience.

Yes, the retail communications game has changed again, and this time, the pace is faster and the stakes are higher.

Personalization in Retail: Customizing the Experience

This isn't the worst of times for brick-and-mortar stores, but it's not exactly the best of times.

Traditional retail leaders such as Macy's, Sears, J.C. Penney, and Kohl's are closing stores en masse. The Denver Post reports more than twice as many stores closed during the first few months of 2017 than during the same period in 2016, and retailers laid off workers at the fastest rate in seven years. Throughout 2017, retail sales have been up and down from month to month, and this time, the economy isn't to blame for the retail roller coaster ride. It's Amazon and off-price stores that deliver what customers want: a seamless shopping experience with the lowest possible prices.

Industry experts say these shifts — or disruptions — don't mean the end of traditional retail. However, brands will need to step up their investments in e-commerce and customized communications to stay relevant in the digital world.

Personalization in retail isn't just about delivering relevant insights. It's about delivering those insights via the right channel at the right time.

Brands can customize content and the overall customer experience by leveraging customer data to have personalized, real-time communications with customers as they bounce from online to offline channels and from brand-owned digital properties to third-party sites and apps.

That's a lot of ground to cover, but the following three technologies can help:

1. Custom — and Customizable — Apps

Apps are where it's at for retailers, particularly if they can get customers to not only download them, but also enable notifications and GPS tracking. This way, retailers know users' proximity to physical stores and can lure them inside with personalized discount offers. Retailers that use beacons or other near-field technologies can also deliver personalized recommendations and discounts to in-store shoppers based on their browsing and buying histories.

Sephora's robust, customizable app also acts as an in-store companion, with features such as the Digital Makeover Guide. A customer takes a "before" picture of herself in the app and then gets an in-store makeover from one of Sephora's stylists. While the stylist works, she notes the products and techniques she's using directly in the customer's app for future reference. Later, the customer receives personalized emails with tips and product recommendations based on her makeover.

2. Chatbots

Remember that list of obvious facts retailers already know? Here's another: Social media and instant messaging are important customer touchpoints.

After all, consumers are far more likely to download social apps. Just look at any list of most-downloaded consumer apps — the only retailer to break the top 15 is Amazon.

The challenge is that there are so many social sites and apps that it's hard for brands to have a meaningful presence on them all. Chatbots extend a brand's reach and enable one-to-one conversations with customers across third-party platforms. For example, consumers can now order a Subway sandwich or book a Sephora stylist appointment via a Facebook chatbot, or get H&M product recommendations from a Kik chatbot.

3. Communications Platform-as-a-Service (CPaaS)

Personalization in retail isn't just about delivering relevant insights. It's about delivering those insights via the right channel at the right time — meaning the time and channel of the customer's choosing.

CPaaS enables retailers to do that by integrating all the company's real-time communications features, such as video, voice, text, and instant messaging. Using APIs, brands can embed these contact options into company apps and websites, as well as social media and messaging platforms. CPaaS also interfaces with chatbots across platforms, feeding the bots data and enabling them to pass customers off to human representatives when necessary.

Custom apps, chatbots, and CPaaS are just some of the ways retailers can deliver a seamless, personalized experience across channels. That experience goes a long way toward engaging customers, earning their loyalty, and driving both foot traffic and conversions.

Do you want to learn more about communications technologies for retailers? Speak to a Vonage Business consultant.


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