These days, the big box chains aren't the only ones using social media to drive sales. Many smaller retailers are trying to keep pace with the way their consumers shop and also trying to understand how to take advantage of these new social marketing techniques.
Today's consumers judge retail brands by how they engage shoppers, whether retailers are listening to consumer preferences, understanding what consumers want to buy and when they want to buy. Consumers want retailers to offer them ideas for future purchases based on their "personal" preferences.
This stream of instant customer feedback via social media is generating a seemingly unmanageable amount of information. We call it big data. It's data about consumers: what they buy, when they buy and how they want to buy. As a result, companies are constantly rethinking the ways they design, produce and market products and services.
New social media sites are being created every day, which constantly change the way consumers stay engaged with retailers. Social media has opened up a direct two-way conversation between brands and their customers, giving consumers an influence never seen before.
Now that big data is placing new demands on the marketing profession, chief marketing officers have the ability to understand each and every consumer, not as a demographic or type, but as an individual. This enhanced understanding of individual consumers enables marketers to adjust campaigns in real-time, and tailor pricing and promotions across thousands of offers for millions of customers, which creates a personal relationship with a brand. These personalized offers make marketing more like a welcomed service, instead of a nuisance.
The question for many retailers, large and small, is this: Are retailers willing to take advantage of the marketing "intel" social media and advanced analytics can provide?
In speaking with a number of small- and medium-sized businesses (SMBs), many of them want to use new analytics capabilities to help better understand their consumers. However, smaller businesses are taking a bit more time when it comes to adopting these advanced capabilities simply because they want to be sure they will see an immediate return on their investment.
Without analytic insight, most SMB owners are just shooting in the dark and relying on their gut feelings to determine their customers' needs and wants. Without a way to accurately measure web traffic generated from social channels in relation to an increased online or mobile presence, there's simply no way to connect the increased number of qualified leads. Without this level of insight, how can a retailer adapt, plan and grow?
Big data is expected to be truly transformative for SMBs by offering insights into business operations, understanding competitive landscapes and driving informed decision-making. SMBs have begun to recognize the competitive advantages big data technology offers. The first to take advantage of this will be in the best position to change the rules of engagement.
Compared to larger enterprises, SMBs typically face three core obstacles: lack of money, time and resources. Regardless of these challenges, SMBs also have substantial advantages over their larger counterparts. They're more flexible, more adaptable and more responsive, if they do it right.
More and more SMBs are turning to managed service providers to manage retail web sites, which are becoming more complex and require interactive applications to target consumer attention. It's these local technology providers who can take on the responsibility to manage the growing amounts of consumer data in the cloud, while also helping retail web site operators to run their sites and scale up with the necessary computing power and data storage.
The greatest marketing challenge is to gather all this disparate data and exploit it in the most cost-effective way, while staying a step ahead to anticipate the future demands of the individual consumer.
Yes, SMBs need to focus on growing their customer base and keeping their customers happy by targeting marketing messages as precisely as possible. In order to attract and keep customers, retailers need to ask customers, "What would you like?" and then provide it.
But smaller retailers also have to understand that customers will not always anticipate their own needs. They don't know what's technically possible or what will be desirable to them as social, cultural and business environments change.
Having the foresight to know what is possible and giving it to consumers before they even ask will be key to set a business' retail brand apart from the competition.
All small retailers have to do is take a step back, look around and gain a little analytic insight to see the next big trend around the corner that will attract the individual consumer.
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Find out more about IBM's CMO study and how that affects midsize businesses.