's current retailers are already very good at mining their transaction records, looking for overlooked data points to help them understand customers more deeply.
However, there is one thing that will never be understood by only analyzing the data of customers in the store, that is, the transactions of customers outside the store and with competitors.
Before, cross-shopping preferences were relatively fixed, and different consumer groups would have different and relatively fixed choices when buying different categories. For example, some loyal customers may like women's clothing in this store but prefer children's clothing in another store. This may be a zero-sum market, but it is easy for retailers to grasp and adjust accordingly.
And now, the online shopping market is complex, with many competitors, and physical retailers simply cannot grasp these data, and it is difficult to find ways to make money in the pockets of consumers.
When it comes to online shopping, what makes physical stores hate the most is-Amazon! E-commerce, led by Amazon, is revolutionizing the lives of physical stores. Even large chain retailers are still living on their meager profit margins. Amazon’s threat covers all areas of retail, and what’s even more frightening is that almost no customer is completely immune to its temptation.
Amazon has rich, multi-dimensional and massive data, which can conduct a comprehensive analysis of consumer behavior in various categories. If brick-and-mortar retailers only want to compete with the online shopping market based on consumer transaction data in their stores, they are fighting a battle that does not know each other or themselves, let alone the enemy's weapons are much more advanced than you!
In order to win this war, you must fully understand your market and your competitors as you know yourself. This means that you need to start with your customers-know who they are following with before they know you. How to respond. It is very undesirable for the
entity to ignore the network. I still remember that in 2008, Zappos.com won the top 10 best customer service awards. After the awards, the host took the microphone and said disdainfully: "Zappos? What?" The host probably didn't have sufficient information, and ignored this rising star in the retail industry.
In order to make everyone more fully aware of the threat from the Internet, let's take a look at the data provided by Amazon Consumer Intelligence Service. The chart below shows the consumer mix of Keer, Macy’s and Target. Each of them has 30% of regular customers who are also Amazon Prime members.
Think about it: 33%, 37%, 39% of customers of a retailer are also paying members of e-commerce competitors. What an impact! The point is that 10 years ago, not many people talked about this competitor. It was the neglect of physical retailers that made them passive.
Moreover, even electronics and non-staple food retailers have to join this carnival initiated by Amazon. Publix and Best Buy are also being eaten by Amazon.
and these Amazon Prime members are retailers’ most valuable customer resources. They live happily, have higher incomes, and are willing to spend money. In other words, for any retailer, they are the customers who create profits.
There may be some retail executives who are still unwilling to admit the threat from Amazon. I can only say that I hope they can survive until the day they retire and get cash in stocks and pensions to enjoy their old age. For those who still hope to strive to recreate glory, they must go beyond their own transaction data analysis and integrate external data to recognize and respond to the threat of Amazon!
