Customer Data: Good For More Than Marketing - Lift361

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Customer Data: Good For More Than Marketing

By Ed Higdon. Posted in Action

September 03, 2014

It was once true that customer data was a tool wielded exclusively by retail marketers. After all, what could anyone else do with sales numbers? What can big data do beyond tracking performance?

Turns out, a lot. If you analyze and organize your data correctly, you can perform a customer understanding study to learn more about your top customers’ lifestyles and habits. Customer data can show you who your best customers are, and how you can keep them loyal. Do you know if your primary base consists of high-income families? Young suburban couples? High-rise condo dwellers? Determining who’s buying your products can help you make decisions at all levels of your organization.

Get A Move On

For one, customer data can help determine real estate options. Your store’s success depends on its location. Does it belong in the suburbs, where people need cars to get there? Or does it appeal to commuters riding the bus daily? Are your best customers high-income retirees? If you choose a location that is not close to, or surrounded by, your target customers, you could be setting your store up for failure. In order to avoid this, you can use your customer data to create city-specific profiles of your customer base and find real estate that matches.

For example, our research shows that stores that can find the perfect mix of customers and population density are profitable 95 percent of the time. Customer data can help you to find the perfect location and increase revenue.

Lay It All Out

Data on top profiles can also help retail and regional managers with merchandising ideas and direction. Take tech retailers as an example: do you stock the newest gadgets at the front, or entice window-shoppers with discounts and sales?

It’s a trick question—there’s no right answer. It actually depends on your customer base. If your best customers are high-income families, then children’s merchandise in your front window is excellent at drawing in both parents looking for innovative gifts and children wowed by flashy window displays. But if your most consistent customers are high-income singles, the latest tech gadgets are a better call, because they more likely keep up with the latest trends and want to see what’s new and exciting.

If your biggest numbers come from value-seeking customers, don’t scare them away with your most expensive merchandise—lead instead with clearance items or a rotation of fresh weekly sales to cater to those loyal to you.


Not sure where to start? Make sense of that big data so you can put it to good use.

A Proven Example: The Macy’s Way

You’re likely familiar with Macy’s, the massive American department store. Macy’s began a localization effort some years back, and localized 15 percent of their merchandise by giving more power to their regional managers, rather than approaching each store with a blanketed design.

The managers analyzed their individual data to determine the personality makeup of each store. And it worked. Combined with other initiatives in omnichannel branding, their profits rose by 5 percent, and share earnings rose by more than 6 percent in a single year.

The take-home message is this: don’t keep big data within just the walls of your marketing department. By strategically analyzing your information, you can effectively use your information across your entire organization. From where you locate your store to what you should display in the front window, big data helps you to appeal to your target audience; and this approach is proven to drive profits.