From club memberships to mobile apps, merchants encourage customers to return by offering them incentives like discounts or gifts in exchange for their loyalty. But are these retail marketing strategies really worth the investment?

According to the RJMetrics 2014 Ecommerce Benchmark Report, repeat customers are one of the best assets a company can have. The study found that the top 1 percent of a retailer's shoppers provide more business than the bottom 50 percent combined, Practical eCommerce reported. Therefore, it's well worth the time and effort to foster lasting relationships with customers.

Loyal customers spend more often and buy more each time
The RJMetrics report corroborated findings by an Adobe study from last year indicating that return customers spend greater amounts on each purchase, the source said. Repeat shoppers also tend to require less customer service, reducing human resource costs.

Therefore, while retail marketing campaigns often focus on converting shoppers, it's essential for merchants to maintain good relationships with existing customers. This is a consideration for email marketing and other ad campaigns, where loyalty can be won or lost depending on whether emails are helpful or seem like spam. 

Loyalty programs
Offering customers incentives to return is an excellent strategy for building loyalty. These programs are most effective when they make use of technological options and focus on relationships, not just numbers. For example, retail customer intelligence makes it possible to offer shoppers personalized rewards based on their shopping activity. 

At the National Retail Federation (NRF) Convention, held January 12-15 in New York City, industry leaders discussed some of the ways they are using mobile to transform their loyalty programs. Representatives from Century 21 explained how they created a mobile app to optimize their four-year-old loyalty program, the convention newsletter said. The app makes the loyalty program more exciting and interactive by giving customers the opportunity to spin a prize wheel and it informs loyal shoppers when there's a flash sale, the source explained.

Loyalty programs are strongest when they foster a relationship between consumers and retailers. At the NRF Convention, representatives from Sephora emphasized the importance of having employees involved in promoting loyalty programs, particularly when they're excited about engaging apps, the newsletter said. Merchants can include loyalty apps in their POS retail management software to make it easier for employees to add customers to their program.

This entry was posted by Retail Pro on Friday, January 24th, 2014 at 10:18 am .

Merchants that want to improve customer engagement, data analytics and retail inventory management require streamlined, efficient retail technology. According to a recent report by the National Retail Federation (NRF), Demandware and the University of Arizona, 35.8 percent of retailers are considering a single-platform solution to help them manage their multichannel operations.

The survey polled more than 200 retail business technology executives in the U.S. and Europe and found that the majority plan to upgrade their retail software and increase or maintain technology investments. With the growth of ecommerce and omnichannel marketing, many companies see single-platform solutions as the best choice.

"In this consumer-led industry, retailers are working overtime to keep up with the expectations and demands of their savvy customers, and are intent on integrating the digital shopping experience like never before," said NRF Vice President of Retail Technologies Tom Litchford.

A single platform is advantageous because it seamlessly integrates information from all channels. Store associates can have instant access to updated inventory information on their retail POS devices after an online sale occurs. It also facilitates comprehensive customer intelligence. As IBM CEO Ginni Rometty said at the NRF Convention, big data is becoming a "natural resource" for the retail industry, and businesses need access to consolidated, up-to-date information.

This entry was posted by Retail Pro on Friday, January 24th, 2014 at 4:31 am .

The 2014 National Retail Federation (NRF) Convention, held January 12-15 in New York City, showcased some of the brightest innovations in retail technology. However, research shows that new strategies like social media advertising and mobile apps are no replacement for some of the classic tools of the trade. Just as the importance of customer service will never die, email is likely to remain a winning strategy for years to come.

According to a recent McKinsey & Company report, email marketing is nearly 40 times more effective for customer conversion than Facebook and Twitter combined. Despite the gains made by Facebook messaging services, email remains the primary means of electronic communication, which means that it's generally the most reliable way to reach customers.

Of course, merely getting a message to an inbox is not enough. There are a few best practices that retailers can follow to make sure their emails have a greater impact.

1. Always be useful. Justin WIlliams, a marketing strategist for StrongView, reminded retailers that usefulness is the key to having customers open emails time and again. Whether merchants are sending email receipts or deals, they should use retail customer intelligence to personalize the message and options.
2. Give subscribers options. Williams and McKinsey & Company agree that bombarding customers with emails can be counterproductive. Regular contact is a good thing, but not when it's unsolicited or annoying. Letting individuals choose which types of emails they want to receive or how often they want to see deals can help retailers foster positive engagement. Merchants should make it easy for customers to unsubscribe and resubscribe so they don't feel like they're being spammed.
3. The click is not the goal. McKinsey & Company suggested that customized landing pages, rather than links to generic home pages, are far more effective because they're more useful for customers and they draw people deeper into the shopping journey.
4. Plan for mobile. As individuals increasingly read email on mobile devices, email marketing strategies must incorporate designs that are optimal for the platform. That includes designing buttons and links that are easy to select with fingers rather than a mouse.
5. Be trustworthy. The need for secure links and ecommerce software is a no-brainer, but retailers must also make sure their emails are reassuring and dependable. Williams recommended keeping language, style and images consistent so customers know what to expect. This also helps consumers recognize emails that falsely claim to represent a company.

This entry was posted by Retail Pro on Thursday, January 23rd, 2014 at 9:41 am .

As the fallout from Target's data breach continues to develop, one question lingers on retailers' minds: How can they prevent this from happening to them? The attack, which is now reported to have affected up to 110 million customers, slipped past Target's security measures and stole hordes of data from the retail chain's servers. And it wasn't just Target: Neiman Marcus announced that its data had been stolen and the same malware strain has reportedly been linked to at least six other retailers. 

As new information continues to emerge about the scope, nature and source of the attack, industry leaders are seeking solutions to bolster security and protect customer data from multiple angles. 

Emphasis on chip-based payment cards
The recent data breaches have renewed industry interest in the latest technology for credit and payment cards. 

"The technology that exists in cards out there is 20th century technology and we've got 21st century hackers," Mallory Duncan, National Retail Federation (NRF) senior vice president, said at the annual convention, according to Reuters.

The promising card technology, known as Europay MasterCard Visa standard (EMV), has been used in Europe for years. It stores consumer information on computer chips, rather than magnetic strips, and requires PIN numbers. These chip-based cards might not have prevented the Target hack, but they would make it much more difficult for cybercriminals to use stolen data. 

However, a number of hurdles remain before the technology can become widespread in the United States. First, banks and card companies need to implement the technology and agree on conversion costs and liabilities. Retailers also need to implement systems that are capable of reading the chip-based cards. Many leading POS software systems are EMV compatible or can be retrofitted with the technology, the NRF Convention newsletter noted, and retailers can ensure the greatest security by staying current with software upgrades.

Best practices for point of sale systems
Even before EMV cards become widely available, businesses can take a number of steps to make sure their point of sale systems are less vulnerable to attacks. Newer POS systems have the capability to encrypt data from end to end, which adds layers of protection to customer data, Forbes reported, making it more difficult for hackers to steal identities. POS devices should be used only for POS, Search Security emphasized: A set up where POS applications are used on a computer alongside other programs leaves the POS data exposed to multiple entry points for malware. Instead, POS systems should be on isolated and segmented networks that are protected from the rest of the system by multiple safeguards.

This entry was posted by Retail Pro on Thursday, January 23rd, 2014 at 3:09 am .

Things are looking up for the global economy. Both the International Monetary Fund (IMF) and the United Nations anticipate that the next few years will bring growth. According to PricewaterhouseCoopers' (PwC​) 17th Annual Global CEO Survey, business leaders are optimistic about the coming year and plan to use retail technology to help bolster a period of expansion.

The survey found that despite worries about over-regulation and deficits, CEOs are more optimistic about the global economy and their business prospects than they were last year. This means that they can turn their attention toward growth and gaining a competitive edge, instead of fortifying a survival strategy.

Business leaders expect the U.S., German, U.K., and emerging markets to provide the greatest opportunities, the report said, rather than BRIC countries (Brazil, Russia, India and China) which were a focus in previous years. Their strategy for making the most of more positive economic conditions has a strong technological component – 81 percent of CEOs believe that technological advancements will play a strong role in their future success, Business Today indicated.

Business Standard reported that, according to a recent Tata Consultancy Services study, CIOs want to capitalize on the positive economic conditions with multichannel integration, ecommerce software and retail business intelligence. The source said that CIOs are planning to implement mobile strategies including payment and POS services.

This entry was posted by Retail Pro on Thursday, January 23rd, 2014 at 3:09 am .

Recent developments in retail technology are focused on shopper-centric marketing strategies. Retail customer intelligence helps businesses personalize ads and deals to individual consumers. One of the latest areas of exploration, called geofencing, uses customers' locations to send them retail information they can use immediately.

Geofencing works through mobile apps that identify a shopper's location and send him or her relevant messages. For example, Apple's new iBeacon protocol can help retailers engage customers on location. This means that consumers can receive deals and suggestions while they are in the store or shopping center, which can lead to more immediate responses.

Retailers can take advantage of this technology in a number of ways. The ABA Banking Journal described a scenario in which customers could receive information or coupons when they stop in front of a specific display, such as a shelf of Keurig products.

The application of this technology must be done in a non-threatening, non-invasive way to prevent customers from feeling bombarded by ads or violated by location tracking, the journal cautioned. Apps that allow shoppers to opt-in on services like coupons or suggestions can help. At the same time, consumers are beginning to feel more comfortable about having their location shared through apps. A recent Life360 survey revealed that nearly two thirds of smartphone users allow apps to share their location.

This entry was posted by Retail Pro on Wednesday, January 22nd, 2014 at 10:02 am .

In late December, Amazon patented a process for shipping products before shoppers buy them. The process, which the company calls "anticipatory package shipping," uses retail customer intelligence to streamline and expedite delivery services. 

The Wall Street Journal blog reported that by analyzing data about consumers' previous purchases, search history, wish lists, shopping carts, returns and cursor hover trends, Amazon believes it can discern customers' needs before they make a final decision. By adding this technology to its shipping drones and delivery lockers, Amazon makes one thing clear: To stay competitive, retailers need to find creative ways to take advantage of new technology, like Big Data analytics.

Although Amazon's idea is both patented and dependent on a large-scale operation, companies across all industries can use retail business intelligence to streamline their processes. For example, shoppers' online activity or in-store inquiries can be used to launch personalized marketing campaigns, and stores can identify items that consumers generally purchase together to organize their displays more effectively. 

At the same time, Amazon's efforts to get goods into consumers' hands faster could indicate the strength of omnichannel marketing, suggested Bob Hetu, research director at Gartner. Omnichannel stores have a home-field advantage when customers want instant gratification, he noted, and Amazon might feel pressured to compete with their combination of online and on-hand resources.

This entry was posted by Retail Pro on Tuesday, January 21st, 2014 at 6:50 am .

If the holiday season holds retailers' sales dreams, the subsequent months hold their returns nightmares. A side effect of ecommerce growth has been an increasing number of returns, the BBC reported. However, retail technology can also help to reduce some of the stress for merchants.

According to the source, online sales often result in more returns than in-store purchases, since customers aren't able to try out items in advance. To help shoppers make more informed decisions, retailers have improved product descriptions and images, but analysts still estimate that between 25 percent and 50 percent of online purchases are returned, the source noted.

With inventory flowing out and in through multiple channels, retailers need integrated systems that can accurately track what they have in stock. RFID tags can help businesses better monitor individual items, and merchants can use retail management software to immediately update information across their systems, as industry leaders at the 2014 National Retail Federation (NRF) Convention explained.

Retail business intelligence can help companies transform returns data into an advantage. For example, customers who buy two sizes of the same shoe are more likely to return a pair, and merchants can use this data to better analyze their sales figures. Stein Mart explained at the NRF Convention that it uses business data to prevent fraudulent returns and reward customers who make returns less frequently.

This entry was posted by Retail Pro on Tuesday, January 21st, 2014 at 6:08 am .

Retail customer intelligence and other forms of data analysis can help businesses target their advertising strategies and optimize store operations. However, while Big Data is on the rise, many companies are struggling to make effective use of the information they have gathered. To achieve the greatest gains from retail data, merchants need to implement the right tools, processes and support.

Only four percent of businesses believe they are managing data effectively, a KMPG​ study revealed. Although nearly all companies think data and analytics is important to their business, the majority find it difficult to use the information to make strategic decisions, and many struggle to integrate data technology into their systems.

As they struggle to take advantage of the possibilities offered by retail business intelligence, American merchants are falling behind their European counterparts on predictive analytics. According to Computer World, U.S. retailers are using predictive analytics only for email, whereas European companies are finding additional applications for the data. However, European retailers could learn from U.S. companies in areas like customer data banks and multi-channel data integration, the source said.

In an effort to solve some of these deficiencies, businesses are expected to invest more in retail technology that assists with Big Data insights and real-time analytics, RIS News reported.

This entry was posted by Retail Pro on Sunday, January 19th, 2014 at 5:42 pm .

Digital receipts are environmentally friendly and convenient for customers. They reduce paper consumption, avoid toxic chemicals often found in receipts and help buyers keep track of their documents. According to Retail Week, Twitter founder Jack Dorsey is encouraging retailers to focus on an often over-looked benefit of electronic receipts: customer engagement.

At the National Retail Federation (NRF) Convention on Jan. 15, Dorsey explained how businesses can use digital receipts as a component of their retail marketing strategies, the source reported. He suggested merchants use interactive digital receipts that can be sent as an email or text message, a venue for opening the door of communication between the store and the customer.

"Sometimes the receipt isn't taken –  the reason it's not taken is it's not useful," Dorsey said in his keynote address, according to Retail Week. "We see the receipt more as a communication and publishing medium – a product in itself that people want to take home and engage with."

POS software makes this form of customer engagement easier for businesses. For example, Retail Pro, in partnership with flexReceipts, offers eReceipts through its retail management software. By sending eReceipts, retailers can include personalized promotions to engage consumers and encourage additional purchases.

This entry was posted by Retail Pro on Friday, January 17th, 2014 at 8:52 am .