Last year’s Cyber Monday saw online shoppers spend an average of £19million an hour in a bid to get the best bargains in the run up to Christmas.
Online sales are likely to be even higher this year and the opportunities for retailers and marketers have never been greater.
For well prepared online retailers the multiplier effect on business performance can be significant, but for those who cut corners, it will be a lost opportunity. To a great extent the difference between success and failure will come down to how well marketers can utilise their data.
Firstly, most retailers will be focusing on maximising basket size by proposing additional and related products or personalised offers to drive impulse purchases. These include everything from bundles and ancillary products through to accessories and recommendations on ‘what others bought’.
Such personalisation relies on the transactional data held in retailers’ databases. However, such data is often held in siloes based on where the purchase was made - web, mobile or in-store, for example. What will really set apart the great from the good during Cyber Monday, are those organisations that have removed these siloes and unified the data from all channels, creating a complete picture of the customer’s shopping habits.
This gives such retailers a much higher likelihood of generating an offer that resonates with the customer and results in a sale.
Another key consideration is speed of data analysis. Many retailers still do data analysis offline, thereby losing precious time. Cyber Monday winners will have real-time data tools and be able to act on customer profiles days in advance of the competition.
The ultimate capability, however, is being able to mine large volumes of data relating to an individual shopper beyond purely transactional information. Shoppers who live online continually leave valuable data that provide retailers with a true 360° view of their interests, locations, sentiments and searches.
The retailers that will get the most from Cyber Monday are those equipped with heavy data appliances and technologies which support Big Data analysis - such as open source Hadoop - leveraging social media listening and clickstream data.
Another major success factor will be the extent to which marketers can reduce instances of abandoned ‘baskets’ - occasions when a consumer abandons their shopping due to a slow online experience.
This is usually caused by system slow-downs from large volumes of concurrent transactions pushing retailers’ infrastructure to its limits. The best retailers will use sophisticated performance testing tools to stress test or spike test their systems.
The absolute winners, however, will be those organisations that have shifted into cloud-based infrastructure, where they pay per use, and avoid the worries of volume spikes.
But it is not just about ensuring that people don’t abandon their baskets, successful marketers will also retarget consumers who had previously abandoned their shop. By using cookies (while respecting data privacy laws of course), marketers can retarget those customers with offers and product suggestions that can bring some shoppers back to buy. When it comes to offers, moreover, testing will be vital.
The best practice in any highly competitive environment is to test offers in as many variants as possible before going big on the most effective and most revenue-generating days. Retailers must ensure that they complete all offer testing in the build-up to Cyber Monday so they are ready when the day comes.
Finally, there is pricing. Pricing plays an important part in a retailer’s strategy, and price matching is fairly commonplace. Responses to changes in competitors’ pricing, however, usually take about a day to put in place.
This Cyber Monday, marketers that can use technology to constantly monitor market price adjustments are at a huge advantage, allowing them to immediately adjust their own prices to any fluctuations. This is yet another example of where real-time data analytics will provide competitive advantage and it is now just a matter of waiting to see which companies get in there first with such innovations.
It is very easy for retail marketers to get distracted by the vast amounts of data analytics offers, and it can be difficult to know where to start. Success depends on having a strategic focus and a corporate desire to transform their business into a truly consumer-centric enterprise.
This often requires new organisational capabilities and buy-in from the senior management team. If this can be ensured, and the above best practice guidelines put in place, Cyber Monday 2012 could turn out to be the most profitable yet.