A heartfelt forward
We all had plans. We were marching forward with our infrastructure projects, we were “journey mapping” our way towards marketing goodness. We were modeling the connections between customers, planned inventory, and our upcoming seasons. Hard to believe that was just a few short weeks ago.
Like the iceberg to our Titanic – Covid arrived to throw our world into turmoil – creating a new reality that defies reality. I’ve been involved in a few dozen conversations with retailers over the last few weeks. The chaos I’ve seen – knee jerk re-actions by some, the focus of a select few – it’s made it clear that we need to talk about this reality…that we need a customer strategy. That we need it now. Not tomorrow. Not a month from now.
This isn’t about selling products in the middle of a pandemic, but about keeping our teams employed.
I get this seems crass. People are dying. Our economy is in turmoil. That said – I would be failing the 50+ brands I’ve worked with and for if we didn’t talk about the path to keeping product moving through our sales channels, keeping cash flowing, and keeping our teams employed.
The Era of Covid
I’m not a doctor, nor do I play one on TV , but I’m viewing the arrival of Covid in 3 discrete tranches of time; Covid Triage, Covid Recession, Covid Recovery.
- Covid Triage is what we are living in now. This is marked by the most severe Customer change and volatility. Why? There is no pattern. We are living in the midst of Covid and people aren’t responding – they’re reacting. Based on best available data – we will be in this phase for another 3 – 9 weeks (I’m betting closer to the latter).
- Covid Recession is more than the inevitable result of the economic upheaval Covid is causing. It is a window of time that Covid is still among us. I believe we will experience “false starts.” These are early attempts to return to “old normal” disrupted by Covid clusters re-emerging and sending us back into our barricaded existence. I’ve heard timelines between 12 – 18 months of this reality.
- Covid Recovery is not a return to old normal, but a stabilization of new normal. It is unwise and contradictory to assume that our customers will emerge from a 12 – 18 month economic and social upheaval unchanged. That, my retail nation, is the point.
We sell products to people: making personalization personal
As we move through the phases above as retailers, we have to be aware our customers are doing the same. Each of these phases are marked (marred) by stressors – Economic, psychological, social. These stressors materially change our customer – what they prioritize as a purchase, and who they are going to choose to purchase from.
Now is the time we focus less on who our customers are – and focus more on who they need us to be.
Your job, as a retailer who doesn’t merely want to survive the Era of Covid, is to get in front of these customer changes…and there is a path – a genuine methodology.
First, know who your shopper is
The concept is called a “pragmatic persona” – personas that are data driven. This uses appended data to identify customer clusters to create a description of who your customers are (you can do this based on spend within product lines and/or predicted purchase by line – if you have the ML).
Covid Customer Clusters – our job is to understand how our customers are most likely being impacted.
The goal is to identify less the usual “appends fodder” but rather get to a stronger characterization of who your customer truly is. Now is the time where a suburban family with moderate disposable income will mean something radically different than a single city dweller living paycheck to paycheck – and appended data can be that descriptive. We create a meaningful customer definition that allows you to gain perspective on their reality – to empathize.
Next, Thematic Empathy (guiding your customer strategy)
Retail nation – This is an exercise every retailer should be doing with every line launch, every season, and every meaningful shift in your shopper community – but only a few of us do.
Under normal circumstances – this is a process of developing the messaging that supports securing share of wallet – for both your retail brand and your hero/anchor products. It’s a process of defining “what a shopper needs” in order for them to make the choice that 1.) They want to purchase the product. 2.) They want to purchase that product from you.
Ignore the science of purchase lifecycle in the Era of Covid is knowingly putting your retail brand in more risk.
In the Era of Covid – this needs to look different. You will be competing for share of wallet knowing that wallet has shrunk. Knowing that the level of scrutiny and criteria for purchase has changed – you are not only defining for the persona, but also against your competition.
This is an exercise in empathy – if all you come away with is a discount strategy – you’ve already lost.
The result should be something – humanized. A “theme” that, while may use discounts, also speaks to your personas – illustrating product value in ways they need to hear it, articulating (and revising) your retail brand value in language that will resonate with their new reality.
Put the effort to work
Once the work is done, it’s time to use it. The framework below was specifically designed to bridge persona, sub-personas (when applicable) to theme, to customer life-cycle execution.
Your themes create the conversation. Applying the themes to customer life-cycle transitions themes into strategy – creating value for both your brand and customer
For some retailers I’ve worked with, the above is simply an expression of your general “corporate branded” themes – a representation of the retail brand at large. For others, they use this template within every hero/anchor product line they have, within every season, reconciling product to the overarching “corporate” version of this framework. In essence – a tool to manage line level customer messaging that also insures global messaging and offer continuity. In the Era of Covid – start somewhere, start anywhere…just, for the sake of your business, start.
And don’t forget the data science
The competition for share of wallet is going to be fierce. This isn’t a game of “expanding share of wallet” but rather – for many of you – preserving share of wallet – or…well…survival. That said, I truly believe data science and the insights produced are your weapons in surviving this fight.
In the Era of Covid, data science is the pillar to your art of customer optimization
I’ve gotten a deluge of questions – retailers have been asking “How does Covid affect our models?”… the answer is – massively. It’s a global pandemic. That said, I have 2 recommendations.
Recommendation 1: Forget accuracy and focus on utility. For most of you- your data science is project – not product. In other words, the insights you rely on aren’t going to self adapt to these changes. Many of them will still be “directionally” accurate when it comes time to execute – and that will have to be good enough.
Product propensity is still propensity, just the customer likelihood of actually acting on it has changed.
Use the data science you do have, treating the insights less as “truth” and more as signals – and you will be better off than most.
Recommendation 2: Data science as product vs. project (context is the path). Context creates understanding – for humans and machine learning. Real learning – learning that is sustained, self adapting, and responsive – it’s not actually about the data…but rather how you enhance it.
The difference between data science product and project is the ability to craft “context” around your source data.
This is “context” – the process of creating additional description around all of your data. The role of context is as it sounds – to vividly (analytically) describe the customer’s line level relationship, sales channel relationship, the how/why/when a transaction occurs, and who the customer was (and is).
For those of you who have crafted context into your data science – you are miles ahead of your competition and have the opportunity to move substantially ahead of them in the coming months.
In closing – we will get through this…but…
Covid19 Recovery won’t be a return to old normal, but a stabilization to a new normal. Again, it is unwise and contradictory to assume that our customers will emerge from a 12 – 18 month economic and social upheaval unchanged. Retailers who blend Empathetic Thematics with insights to engage their customers with relevance and understanding will be brands who emerge stronger and positioned to achieve.
by Angel Morales