Conventional wisdom has maintained that Personalization Utopia can be obtained by 1-1 Individualization. Sounds like a novel idea, but the reality for eCommerce executives is that it is not only difficult to achieve, it is simply not scalable. Thus, these initiatives eventually never take off and often find a home in the archives of failed plans.
Why is it so hard? What can retail leaders do to get close and what can technology do to assist?
Well for starters, cross-functional alignment is absolutely needed to determine the KPI impact. If there is a new program to reduce churn, eCommerce needs to lay out the strategy, corporate provides content, legal approves the media, merchants agree on categories that may be impacted, and lastly, the CFO approves the budget.
Many times, somewhere, one of these key links goes missing, and the programs never take off or never realize their full potential.
Most companies are quick to jump into initiatives like Improved Search when only 10% of the users use search. What about the 90% that don’t? And if browsing is key, then start with browse. Then, work your way to clearly understand the user’s journey.
You will be surprised with the results of the exercise. And don’t just rely on the eCommerce team – pull in your merchants (buyers) into the conversation. It shapes their demand planning too!
While popular initiatives take precedence, it is crucial to focus on YOUR business and see what makes sense to start from! So what gives? How does an eCommerce executive start? Here is a simple recipe for getting results fast!
- Identify the revenue or savings goals of the stated imperative – In fact, let the goal and the KPI drive the imperative, not the other way around! I have had dozens of executives and practitioners tell me they are locked in on a CDP or a Client 360 or a Personalization/email initiative. But three questions in, I realize that the KPI goals were not clearly defined, participating teams were not identified, and the ability to measure, correct, and re-launch had no place in the slide show used!
- Find out the ability to attribute the exercise – aka build a Pro Forma for the ROI, NPV savings, or simply incremental Cash Flow. If the goal is to drive revenue, understand how you will measure specific impact so you don’t dilute other initiatives or worse, double-count benefits – that’s the worst case. Sounds basic, but I have been surprised before!
- Get to real-time audiences first – before you can personalize, you need to know who to go after. Then we can worry about how to get to them. Pulling in-store transactions can provide a world of insights because they are the best evidence of success. However, if they are not used to influence your online behavior then it’s not useful to anyone. Understand where your shoppers spend time and derive audience behavior to choreograph experiences online.
In summary, as macroeconomic conditions create a lot of concerns on spend, it is imperative to go back to the basics of building a solid business case with a strong financial benefit tied to it.
The numbers are the easy part. Bringing cross-functional agreement along with user stories that are evidence-based (e.g. online conversions and store transactions) and justifiable in front of your CFO will drive success.
Companies that are willing to focus on the above will come out winning on the other side of the uncertainty because they invested in areas that matter the most – and not just because it ‘sounded right’.