Monday, December 2, 2013

3 challenges for Retailers attempting "Test" and "Control" Campaigns

Campaign Management with A/B Testing seems to be quite the norm for eCommerce companies of late. But is it as easy to achieve for Brick and Mortar Retailers too?

Increasingly, I can see retailers being attracted towards products/services that integrated their CRM and their Campaign Management platforms. Among the many products that make this easy for eCommerce are Responsys (for executing email marketing campaigns) and Optimizely (for Website Optimization). They have incorporated the A/B Testing into the very DNA of their product, and this therefore, transforms into the way their clients use their products.

While it is easy to have all of the systems integrated in the context of eCommerce or web-retailers, this becomes a lot more difficult to achieve for Brick and Mortar Retailers. And that is where an opportunity lies for open systems who can automate campaign management and feed results directly back into the CRM.

In some of my conversations with retailers, I have observed that the number #1 problem that retailers today face when executing campaigns is the movement of customer data from one platform to another. Let alone A/B Testing, even executing campaigns is sometimes "put off" by retailers because "moving customer data from here to there is not that easy and time-consuming!"

In my mind, there are 3 reasons why this is difficult to achieve for Brick and mortar Retailers:
  1. 1. Legacy Point-Of-Sale Systems: A lot of the POS systems that many of the retailers still use are built on legacy hardware/software and therefore make it difficult "capture" data from. Besides, these store terminals often don't "speak" to each other, so maintaining a Single View of the Customer becomes a challenge.
  2. 2. eCommerce as a separate channel: while getting data from eCommerce is fairly easy to filter into the Campaign management system, at every step, there is a need to "de-dup" the customer data form eCommerce with the data from Retail Stores. This problem is, of course, pronounced only for Omni-Channel retailers (present across BOTH Brick 'n Mortar and eCommerce channels), which most mid-sized to large retailers are today.
  3. 3. Open Systems with well-documented APIs: While there are a bunch of integrated CRM/Campaign Management offerings in the market, integrating with store systems remains a challenge, since POS systems might not be as "Open" as their eCommerce counterparts and therefore might not be very easy to integrate with.
It is for these reasons that I believe the "Culture of Testing" (as Andrew F. Chen of the GILT Group refers to it) and the truly successful omni-channel retailer of tomorrow will be one that manages to run integrated campaigns with real-time measurement and is able to use results of A/B Testing towards getting engaging more meaningfully their store customers as well!