March 2008 - Electronic Retailer Magazine

channelCROSSING
research
BY DAN NEELY
68 electronicRETAILER | March 2008
You’re Listening to Your Customers,
But Are You Hearing Them?
Every retailer would love to know exactly
what’s on their customers’ minds. Most
retailers have adopted technologies on
their sites that engage customers with
their products and their brands, including
customer forums, product reviews
and ratings. These features have done a
great job of making retail sites more
interactive and forming relationships
between your business and customers. In
addition, companies can access the information
customers submit to gain insight
into their opinions and thoughts. While
these current forms of customer interactivity
are well intended and do provide
value to retailers, there is tremendous
opportunity to gain rich, informative
insights from customer interactions. In
this capacity, they fall short. Forums,
reviews and ratings fail to deliver information
indicative of an entire customer
base, make it time-consuming and difficult
to analyze the wealth of information.
They don’t deliver information to the
retailer in real time—a key requirement
for any retailer looking to stay competitive
and keep customers happy.
Current customer interaction mediums
are very successful at encouraging
customers to talk, but do not provide a
way for the retailer to analyze what
customers are saying.
THE LOUDEST PERSON
IN THE ROOM
Forums and product reviews are
designed to help customers make purchase
decisions, and to potentially
encourage sales of popular products.
These mediums allow a customer to take
the floor and endorse or criticize a product,
generally only highlighting the voice
of the “loudest person in the room.” This
is the person who has free time, strong
opinions and the confidence to post in
front of large groups of people. For the
most part, while this person can provide
valuable insights, he or she is not necessarily
indicative of the rest of a retailer’s
customer base. A company that draws
information about its customers from
current mediums is playing a guessing
game when it comes to deciding whether
to take action on the customer feedback.
There is no way to know whether sentiments
are felt customer-wide.
Current customer interaction mediums
are very successful at encouraging
customers to talk, but do not provide a
way for the retailer to analyze what customers
are saying. If a huge portion of a
retailer’s customers participate in forums
and post thousands and thousands of
comments and sentiments around that
brand and its products, the process of
gaining valuable and actionable information
from this vast amount of data is
nearly impossible and often can be inaccurate.
It’s generally a manual and timeconsuming
process that fails to identify
and accurately weigh the influence and
importance of a customer’s content and
the valuable social information about
their interactions.
For most retailers, responsiveness to
customers is key to customer loyalty,
maximizing sales and staying competitive.
Whether you’re competing with
huge online retailers or trying to maximize
sales during a busy time of year,
being able to accurately identify customer
sentiments and take quick action is
a necessity. Receiving this information in
real time is essential to making this happen,
and current forms of customer
interaction do not allow for this.
Knowing in real time that a product’s
price is too high, or that customers don’t
like the new design of a product, can give
retailers the information they need to
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