The rise of subscription e-commerce



Shoppers want personalized experiences that are convenient and easy. Subscription commerce fulfills that need.

Of course, for retailers, that one, seemingly simple desire can be filled in a multitude of ways, which can sometimes be at odds with each other.

For example, a personal shopping experience may mean going to a neighborhood store, being greeted by name and engaging with an associate who knows your shopping history by heart.

It can also mean logging onto a favorite online store, also being greeted by name, but then interacting with a recommendation engine and having a package shipped directly to you.

When customers want certain items on a regular basis, subscription commerce is bridging the gap, letting customers feel a personal connection without having to expend the effort of a physical visit or performing endless online searches.

With subscription commerce, or "subcom," retailers can delight customers while simultaneously benefitting from a source of recurring revenue.

Subscriptions have exploded in popularity, growing from $57 million in sales in 2010 to more than $2.6 billion by 2016.

McKinsey & Company reported that 15 percent of online consumers signed up for subscription services in 2017.

Retailers offering such services report having a much closer idea of warehouse staff and stock requirements, delivery destinations, shipping costs and likely future income.

Retailers generally have a greater sense of predictability, but in the most popular programs, what is delivered often includes a surprise—a carefully curated amalgam of products that the retailer has determined the customer will want.

The concept is popular because it's fun and customers believe they are getting good value.

While shoppers can order specific items for delivery at specific times by subscription, (e.g., Harry's Razors), samplings and curation are two common types of subscription services.



Birchbox (cosmetics), Graze (snacks), and BarkBox (dog supplies) are among the most popular sampling services that consumers can sign up for by subscription.

Birchbox, which launched the curated sample subscription box trend in 2010, mails subscribers four to five new beauty samples and lifestyle items to try for a $10 monthly fee.

Curation is based on shopper profiles submitted by users on the Birchbox website.

Retailers earn recurring income on these subscriptions of sample products; they pay little or nothing for the products they ship on a regular schedule.

Customers join the service and understand it's typically a sampling of trial-size products; those that aren't desired are simply discarded rather than returned.

For example, Birchboxes can't be returned. By offering trials of popular products, retailers hope to increase product interest that will carry over to their online stores.

The boxes offer retailers opportunities to delight customers, with curation, personalization, and pricing strategy being crucial factors.



Curated services are personalized with the shopper's profile in mind.

For example, customers of the higher-end clothing subscription Stitch Fix, benefit from a personal stylist who selects several pieces of clothing based on the shopper's style profile.

Upon receipt of the shipment, the customer has three days to decide what to buy and what to send back.

By sending the stylist feedback, shoppers can receive more personalized selections the next time.

Subscription services answer customers' calls for more personalized offerings.

Shoppers are willing to pay for convenience and subscription services provide that as well as an element of surprise.

Successful retailers understand that subscriptions aren't simply fulfilling a request — that can be accomplished with any sales transaction.

The surprise element of curation and sample subscriptions makes shoppers feel as though they're getting gifts from close friends who understand the recipients' taste — despite the recipients having placed the orders themselves.

The experience delights the customer, and therefore, the trend is likely to continue to be popular well into 2019.




A little data-driven loyalty goes a long way



Retaining existing customers by keeping them satisfied and engaged is far less costly than identifying and appealing to new customers, yet too often retailers let their regulars drift away.

Why do retailers allow that to happen, especially when the costs of customer acquisition are so high?

Many retailers are primarily focused on expanding their customer bases: More customers equal more revenue.

However, if current customers aren't nurtured, they begin to feel taken for granted.

Once a customer feels unappreciated, the separation from the retailer begins.

For example, stores will offer introductory rates, special financing, free shipping or percent-off savings to new customers — while leaving loyal customers to feel left out in the cold.

Savvy retailers understand that to win against all the competition out there — online as well as brick and mortar — new customers shouldn't be favored over the current ones.

Loyalty programs can help show "the regulars" just how appreciated they are.


Reward all paying customers.

Cash-paying customers can't take advantage of certain loyalty programs; some merchants require customers to download an app or link to a credit card in order to get loyalty points.

Retailers are recognizing the problem and are starting to look for solutions.

For example, the AppCard loyalty and personalized marketing platform is a multi-tender solution, which means customers can pay how they want, and still reap member benefits.

In addition, retailers such as Target, which offer rewards through its credit card offerings, are launching a more neutral system in order to reward more customers through its loyalty program.

Being flexible — or payment agnostic —is a smart business strategy, because cash payments make up over a third of all transactions.


Understand how customers want to be rewarded.

Customers enjoy earning — and spending — rewards.

A recent survey of approximately 1,000 online shoppers conducted by Bizrate Insights for Internet Retailer found that 70% of respondents wanted free shipping in exchange for their loyalty.

An impressive 61% also enjoyed receiving reward points they could redeem for discounts.

Unpopular perks: early notification of sales (11%) and exclusive access to products or store events (9%).


Develop personalized loyalty programs.

Successful loyalty programs "speak to" your customers' tastes.

Shopper identities can be tied with SKU-level purchase information from POS like Retail Pro, and this data is used to automatically deliver personalized offers that see increased conversion rates and provide a better shopper experience, which in turn gains shopper loyalty.

Deep learning uses that historical transaction data in your POS to provide loyalty programs with customer preferences and anticipates a shopper's next move, delivering recommendations to increase engagement and prevent churn.

AI built into solutions such as AppCard, help you "learn" your customers’ unique buying cycles and anticipate customers' desires, delivering the right message, to the right customer, at the right time.

Every retailer should understand what its best customers want and design a loyalty program for those shoppers, based on data analysis.

One loyalty program does not fit all customers, so understanding the differences and how to best reach them is imperative to preventing shopper "drift."

Using insights generated from unified data, you can build a loyalty program and overall retail experience that helps you put shoppers first.

Book your NRF 2019 meeting with us to start the conversation on how you can unify commerce with Retail Pro.





6 Essential Elements of a Winning Independent Retail Strategy



Looking to improve inventory productivity and control?

Watch this final part of our 3-part Retailer Success webinar series to see principles and tactics that will help you manage inventory better and compete profitably.

Part 3: Six Essential Elements of a Winning Independent Retail Strategy

  • See how high-achieving independent retailers differentiate themselves to compete successfully in the changing world of Amazon retail
  • Learn the major factors you can implement immediately to differentiate your business in this 6-point plan from Management One


Customer-sourced innovation: How retailers leverage direct customer insight to drive innovation ROI



86% of shoppers will pay more for a better customer experience.

Your team can brainstorm and implement ways to innovate CX… but when you implement changes, how do you know which factors help or hinder improvement?

And how do you know what really is a “better” customer experience?

Watch this webinar to see how customer-sourced innovation can help you close the gap between what retailers think shoppers want, and what shoppers actually want – because innovation really shouldn't hurt the bottom line.

You'll see:

  • Real stories of customer-sourced innovation
  • How to set and improve on your Customer Experience Baseline
  • Tactics to reduce guessing in your innovation initiatives

5 types of data to shape your customer experience



In today’s real-time global economy, retailers are hunting for strategic optimizations to improve experience and spark long-lasting brand engagement.

Data is key to building those one-to-one connections with customers that give them a loyalty-inspiring, memorable experience. And data is key to keeping your brand relevant in the context of shoppers’ lifestyle needs and interests.

Here are 5 examples of data retailers use to shape shoppers’ experience with their brand.


1: Product story



At their inspiring new London flagship store, United Colors of Benetton shares content on selected products, on the Benetton brand initiatives and, thanks to the use of an integrated RFID antenna, they release technical information about the products that are placed on any of their three digital interactive tables.

Product storytelling draws customers in, inspiring both a purchase and a longer-lasting relationship with your brand.


2: Shopper details



Aesop uses user-defined fields (UDF) in Retail Pro to capture the specific type of data they need for their merchandising, marketing, or clienteling strategies.

The retailer tracks data like skin and hair types for each customer, so their retail associates can make relevant recommendations to returning customers.

Acting on shopper details like these lets customers know you’ve noticed them, and you care that they shop from you.


3: Preferences



Rimowa uses Retail Pro customer management and analytics features to actively manage their customer profiles and mine their demographics data. With Retail Pro, they access and act on their shoppers’ preferences for special editions and colors.

Keeping track of shoppers’ preferences allows you to offer a higher level of contextualization in customer engagement, and ensures you’re giving customers what they want.



4: Geolocation



Worldwide Golf Shops use shoppers’ home address to segment their email marketing for store events like sidewalk sales and demo days in shoppers’ area. They also use other customer information collected at the POS to personalize their emails.

Using geolocation data for store events helps you keep your brand a part of shoppers’ everyday life, in a memorable way.


5: Purchase history



Minor league baseball team, the New Orleans Baby Cakes, uses deep reporting in Retail Pro Prism to target and engage with VIP shoppers with fun merchandise unveiling events for those loyal customers.

Today's fans have many choices of where to buy so stores must constantly evolve to meet customers' tastes and create a customer experience that provides something for that fan who has "everything."


These are just a few examples of how your retail data can shape customer experience. Here at Retail Pro, we care about helping you build a strong foundation for powering a unified experience of ease and inspiration across stores and digital retail.

Visit us at NRF to see how you can unify your digital and store experiences for unified commerce that puts shoppers first.



Photo credits: United Colors of Benetton, Aesop, Worldwide Golf Shops, Ryan Micklin

What can leading indicators do for the bottom line?


Think of the data that makes up your Business Intelligence as being made up of cause and effect factors.

Those two factors are lagging indicators and leading indicators.

The difference between them isn’t complicated, but it is critical.


Lagging Indicators = Effect

These are made up of accounting and historic measures.

In other words, these are the financial ratios you build based on the income statement.


Leading Indicators = Cause

These are also historic but look at internal processes and external events that occur prior to revenue.

Some examples of what they are include the number of qualified sales leads, time to market, conversion ratios, employee satisfaction, etc.

These are the indicators you should focus on if you want to improve results.


Why the big difference?

According to Gartner, 80% of current Business Intelligence content is made up of lagging indicators.

However, all of that current Business Intelligence content should actually be made up of leading indicators.

Why the big difference? One word: value.

Lagging indicators are valuable if you only want to look at current conditions, but it’s important to look at future projections to better guide your company toward greater success.

Leading indicators give retailers the ability to “look into the crystal ball” and take proactive instead of reactive action, which can save both time and money.


So what can leading indicators do for the bottom line?

When you have the right information and understand what truly impacts success and failure in your business, the investment brings dividends quickly and abundantly.

Leading indicators are truly valuable for businesses of any size because they:

  • Define what is critical for your business
  • Direct where investment is needed
  • Direct where focus is needed
  • Act as a big data filter to help you focus on what matters
  • Point you to relevant, company-specific data sources


Business Intelligence and analytics is what a particular clothing retail company uses to closely monitor what’s hot and what’s not in stores throughout Europe.

The precise control of inventory, turnover, and production has delivered improvements to the company’s bottom line by an estimated 30 percent.

The old adage “you have to spend money to make money” couldn’t be more true when it comes to investing in Business Intelligence and analytics.



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This blog is an excerpt from the Retail Pro Decisions whitepaper, From KPIs to Profit: Understanding Your Leading Indicators for Better Retail Results. Get this whitepaper today to read more.


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Mobile Apps: Building Unified Loyalty In-Store and Online



Loyal customers are repeat customers.

They are particularly valued because the cost of customer acquisition is high.

However, loyalty is not just about repeat business – otherwise, all repeat customers would be considered loyal, and they aren’t.


Repeat customers vs loyal customers


The difference is that loyal customers make a conscious choice to do business with a company even when a less expensive, more convenient or higher quality alternative is available somewhere else.

So why are customers loyal to a retailer when sometimes it seems illogical?

Because of that store’s superior customer service.

Creating an easy, frictionless shopping experience makes customers happy -- and that satisfaction can be parlayed into loyalty.


Converting online browsers into in-store customers


Only a few years back, brick and mortar stores were dying on the vine.

Customers were going online, finding the lowest price for items, checking them out in stores but buying them via e-commerce.

Soon, though, traditional retailers realized that those shoppers who were browsing but not buying could be turned into customers -- after all, they were in the store already.

Shoppers were saying they enjoyed the efficiency of e-commerce, but they also wanted to touch and feel certain items.

And other items benefited from having knowledgeable salespersons educate shoppers on features, uses, etc.


Building loyalty through mobile apps


Retailers are answering customers’ demands for more efficiency by adding mobile apps to their sales processes.

App Annie, an app market data and insights company, tracks usage and consumption for the average smartphone owner:

  • Average daily use: 2 hours and 15 minutes
  • Average number of apps installed: 60 to 90
  • Average number of apps used monthly: 30
  • Average number of apps launched daily: 9

With so many mobile phones in use, retailers are finding that the mobile app customers could be a key to increasing brand awareness, driving sales and increasing mindshare.

A survey of more than 500 mobile shoppers by research company Clutch, found that not only are consumers using e-commerce apps, but they’re also looking for features that go beyond browsing and buying: “Consumers want an easy, frictionless, and entertaining experience when using apps.”

Clutch noted that shoppers use e-commerce apps primarily for four reasons:

  1. To receive deals and offers (68%)
  2. For the flexibility to buy at any time (64%)
  3. To compare products and prices (62%)
  4. To save time at the store (54%)


The problem with mobile shopping apps


Too few retailers create apps with the consumer in mind.

What shoppers want to do with a retail app is what should drive app creation.

Retailers should develop a focused strategy when developing an app that targets the way shoppers use apps.

Many shoppers want apps that personalize the in-store experience, such as deal alerts, which are enabled when the customer is inside the physical store.

Also, Clutch reported that if an app syncs a business’ loyalty rewards, more than 80% of consumers would use the feature.

Mobile shopping apps are the future of unified retail.

Retailers should continue to increase their capabilities according to shoppers’ requests and usage patterns, and look to include discounts, rewards, personalization, and even augmented reality in the near future.


Which data is most valuable for analysis in retail?


For all the good that data can do for retail businesses, there is one major issue it presents: information overload.

Many companies try to focus on too many different metrics without focusing on those that truly matter.

They have an ocean of data inside the company from every type of software supporting their business processes.

In our experience, marketing departments typically have three to five different systems and manufacturing departments have even more.

As the big data tsunami overflowed the media and blogs over the past years, many companies try to grasp what to do with all that external data that is becoming available.

Some companies have started to collect external data but are not yet effectively utilizing it.

According to Gartner, the confusion around big data is so apparent that they indicate companies will delay spending on analytics and Business Intelligence in general until they figure out how to handle data better.

Actually, most big data investments made to date have been big data services, such as consultancy projects to clarify what they should be examining.

And only 8% of respondents in a recent Gartner survey of CIOs say they have deployed big data investments.

But big data -- or any data for that matter -- doesn’t have to be a daunting task if you start from within.


Determine your end goal

As with anything else in life, the way to successfully move forward, even with developing KPIs and identifying leading indicators, is to first determine your end goal.

That can be anything from increasing revenue to reducing costs.

Next, consider what in your internal and external environment can truly impact whether you are capable of reaching those objectives.


Internal Data

Internal data has to do with the internal processes of the business (product design, corporate vision, etc.).

You most likely own this information inside your company solutions already.

Otherwise, it is time you start tracking and registering.


External Data

External data has to do with economic factors outside of the company that still have an effect (the needs of customers, competitor actions, etc.).

The data needed to understand the external indicators is what is traditionally referred to as big data or external data sources.

Don’t worry too much about whether it’s big or small data; worry about what impacts your company.



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This blog is an excerpt from the Retail Pro Decisions whitepaper, From KPIs to Profit: Understanding Your Leading Indicators for Better Retail Results. Get this whitepaper today to read more.


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4 Ways to use POS data better with Retail Pro



More retailers today are recognizing value in the raw data they collect from every transaction and seeing the need to use it more strategically to create a unique customer experience that will boost their bottom line and keep customers coming back for more.

The challenge then becomes knowing which data to single out from the torrent of data you have available: which data should a retail company track which would give direction for marketing efforts and lead to more conversions and repeat sales? And how do you put that data to good use?

Here are 4 ways you can take advantage of data gathered in Retail Pro POS to personalize your customers’ experience and boost your bottom line.


1: Collect better data with user-defined fields


Relevant data is where data-driven profit begins, and user-defined fields in Retail Pro POS give you flexibility to add the fields for which you want to gather data.

You can start by collecting the basics, like customer names and emails, and put that to good use immediately to personalize your communications.

Or, get more detailed with information like skin tone when you’ve just helped them pick out the perfect face makeup, so your marketing team can make more tailored offers on items like lipstick or blush.

Plus, you can grow your bottom line more efficiently by reaching out to past and repeat customers. This is where collecting emails at the POS really makes a difference.

Retail Pro Prism’s scriptable XML/CSS user interface lets you collect the data you’re interested in to better understand your customers and reach them more effectively.

Because you can entirely reconstruct the POS workflow to reflect your operations, you can create a popup prompting the sales associate to ask the customer for this information, helping you increase the amount of data points you’ll have to analyze.


2: Upsell with customer management features


Upselling is easier than selling to a customer for the first time and can help a store’s revenue grow faster. It should make customers feel as though they are winning – not as if they are simply shelling out more money. And when they’re winning, you’re winning too.

A quick glance at a shopper’s purchase history (or all those customer details you’ve started collecting!) in Retail Pro can equip your sales associates with the information they need to determine what products your customer would find most interesting and relevant, and make the offer for an upsell when they’re in the store.

Make it clear why you deserve these customers’ business, and why you offer a better value proposition than competitors. Most importantly, let them know how they’ll profit too.


3: Report on and analyze all your data for deeper insight on what your customers want

Getting holistic, real-time data in the hands of key decision makers allows them to take immediate action and improve performance in your stores. And when you give customers what they want, they come back for more.

To help you maximize the value of your data, intuitive dashboards and clear graphic visuals in Retail Pro Reporting allow you to summarize performance, analyze results, and explore trends.

Plus, when you integrate all your data sources in Retail Pro Decisions – like data from your database, ERP, CRM, external statistics, Google Analytics, social media, and any other data to which you have access – you can better understand what happened, why, and what’s coming next.


4: Integrate POS data with your CRM and personalized marketing platform to build loyalty and boost sales

Analyzing transaction data as a whole, like what customers purchase from you, when and how often, can be more useful for your longer-term marketing efforts, to better segment your shoppers and create personalized email offers based on their purchase history.

Personalized marketing solutions like AppCard for Retail Pro use transactional data from Retail Pro to trigger behavioral-based campaigns and keep shoppers engaged with your store.

It can help identify brand advocates and nurture prospects with AI-driven, highly personalized offers that helps convert prospects to customers and turn customers into delighted customers.

Watch our recent webinar: How to Use Loyalty Data NOW to Boost Holiday Sales

By combining those data points, retailers can infer a level of interest and reach out accordingly. Remember, actions can speak louder than words.


Proactive retailers are constantly striving to increase visibility into exactly who their customers are, how they’re interacting with your stores, and what they want. And, with Retail Pro, you can collect and act on the data you need to drive more sales.

Want to see how you can put POS data to good use? Request your demo today >

Millennial Shoppers Love Retail Personalization



In a day and age in which “automation” and “self-service” are terms often applied to retail sales, it’s eye opening to learn that millennials seem to prefer an in-person, brick and mortar experience, particularly because this is the first generation that is truly digital.

These young adults spend $600 billion in the United States, according to Accenture.

It’s therefore worthwhile for retailers to understand this group’s unique characteristics and requirements and tap into what they want from the stores they frequent.

Personalization tools can greatly help retailers connect with the millennial shopper, but retailers need to understand these shoppers’ mindset.


1. Millennials come prepared and want sales associates to add value to their research

First, sales associates must offer value to the transaction.

While older shoppers may welcome a friendly sales pitch or having the associate function as a sounding board for potential purchases, millennials are looking for experts and answers to questions.

They’ll often have done their homework online, and having read reviews are coming in-store to “touch and feel” and discuss features and comparable options.

It doesn’t hurt if the retailer makes them feel a little special, as well.

For example, retailers can use intelligent appointment scheduling (IAS) combined with artificial intelligence (AI) to recognize a customer’s upcoming birthday and send a celebratory message in advance with coupons, gift suggestions – or a link to set up a wish list that can be shared with family members.


2. Millennials are on the go, so catch them when they're on their iPhone (which is always)

Second, millennials rely on mobile devices to compare prices.

While many retailers offer in-store promotions, having mobile scanning capabilities rather than printing out coupons is a must for this age group.

They are also active users of social media and will interact with a brand – but, once again, it should add real, tangible value to the shopper.

Accenture found that millennials view social media relationships with retailers as transactional, and a way to get deals.

Creating positive buzz, and becoming a topic of conversation with this group, is hard work.


3. Millennials expect every experience to be technologically inerrant

Third, millennials want a seamless, integrated experience more than other generations.

The transition from in-store visit to smartphone and back again must be frictionless.

In fact, the entire experience must be seamless: From research phase to delivery to possible return/exchange.

Retailers will need to partner with technology, data, analytics and process specialists to give millennial customers what they want in terms of service.

For instance, a third-party logistics provider can supply same-day delivery services for online purchases as well as a buy-online, pickup in-store program.

Scheduling solutions company TimeTrade conducted a survey and analyzed census data to conclude that retailers lost $150 billion in potential sales in 2016 by failing to provide shoppers with personalized service.

Most interesting is that millennials would pay up to 20% more for better, highly personalized retail experiences.

By investing in personalization, retailers will not only appeal to millennial customers, but they’ll also open the door to others as they become more comfortable with omnichannel retail.