Last year accelerated a trend we have been seeing for many years on the British high street. From the collapse of Arcadia to the liquidation of Debenhams, 2020 was characterised for the retail industry by blows to the traditional high street and an increasing emphasis on ecommerce.
And last year’s digital transformation will define the retail industry’s future. More than ever before, consumers have made the transition to online and mobile as a direct result of the pandemic, introducing a whole new wave of customers to the convenience of shopping online for everything from groceries to clothing, in addition to allowing them to experience the ease of direct delivery.
Undoubtedly, smart retail brands must boost their online presence if they want to survive in this new world – but this doesn’t mean in-store shopping is over.
Although many high street retailers had an online presence before 2020, the pandemic has highlighted the difficulty of competing with online retail giants, such as Amazon. This is not just due to these retailers’ size or brand recognition, but crucially, their data capabilities.
Understanding customers better
For large online retailers, the investment in their first-party data has clearly paid off as retail becomes more focused on the connected customer. Further, they have the advantage of a more holistic, end-to-end customer view, allowing them to understand their customers’ journey across many more different touchpoints and devices. Similarly, if high street retailers could better understand their customers, they could learn what items they prefer to buy online versus in-store, or how to better anticipate their needs.
These data-driven retailers have major advantages in measurement and analytics too, and are able to analyse data across wide-ranging product suites and customer interactions: for example, Amazon has access to consumption data of everything from video to music to grocery transactions. The first-party data that retailers like these are able to therefore collect, from life events to demographic to film preference to brand loyalty, allows them a much richer and deeper understanding of their customers.
The result? High street brands can help customers much more accurately to find products that they want – or recommend products that they are more likely to be interested in.
Data collaboration can drive insights that strengthen or enhance first-party data.
Improving and using first-party data sets to their full potential will be critical to long-term survival. Brands will be able to better reach and support customers, and gain deep customer insights that result in a better conversion rate and a better customer experience.
And the challenges brands face are being compounded by rapid changes to how they can engage their customers through advertising, the most significant change being the disappearance of third-party cookies. Losing cookies across all major browsers will reduce brand visibility into a customer’s activities and potentially limit a brand’s ability to reach and drive conversion at this most crucial time. This will have a detrimental impact for advertisers across many key marketing workflows: targeting, attribution, frequency capping, suppression and measurement, to name a few
At LiveRamp, we believe data collaboration offers an opportunity to align with strategic partners across industries to enhance data insights about customers, drive sales and create a better customer experience, while respecting consumer privacy.
Data collaboration can drive insights that strengthen or enhance first-party data. For example, a tea brand might partner with a supermarket to help them to measure the impact of an ad campaign. Through this partnership, it will gain access to store-level data they couldn’t ‘see’ before – the items people tend to buy their tea with, how different times of the year impact tea sales, the demographics who favour their brand most. All of this, done in a privacy-conscious way, helps the brand to better reach its customers and plan its advertising campaigns more efficiently.
Alternatively, a sports brand that stocks its products in a high street shop does not have access to the first-party sales data that the shop has. But by connecting its data with the shop, the sports brand is able to make better decisions based on sales data, and can work with the shop to offer more relevant promotions to customers – benefiting the brand, the shop and the consumer, who gets a better deal.
Thriving through collaboration
The potential of data collaboration doesn’t stop there either – connections can be made between more obscure sets of data, such as the crossover between customers who buy vegan cosmetics products and those who buy alternative milk or specific vegan food products. This kind of collaboration can open up new insights and define new audiences across product lines in a creative way that many brands’ first-party data couldn’t do alone.
And for the high street, such collaboration can help brands thrive, not only online in a world of ecommerce but also in physical stores. By driving these deeper insights and using their data in a privacy-first way to open up new revenue streams, high street brands can connect to their customers more effectively, adapt quickly to suit their customers’ needs, and drive the sales that can help them stay open and compete against online retailers.
The high street, retail at large and the adtech industry have all been impacted by the events of 2020, but as we face the future, there is plenty that brands can do to ensure success. They must embrace the power of first-party data, ensure they are always putting the individual first, and foster collaboration with like-minded partners to connect data and drive the insights that can help the high street to survive in a new age.
LiveRamp is the leading data connectivity platform for the safe and effective use of data. We enable companies and their partners to better connect, control and activate data to transform customer experiences and generate valuable business outcomes. For more information, visit www.LiveRamp.uk.
Vihan Sharma is European managing director at LiveRamp.