Breaking Through Customer Engagement Barriers

Survey Report: Breaking Through Customer Engagement Barriers 2
Introduction................................................................................................................. 3
Key Findings................................................................................................................ 3
Marketing Budgets Span Channels.............................................................................. 5
Facilitating Marketing Efforts Across Channels..............................................................7
Striving For Real-Time Marketing................................................................................. 9
Effective Use of Data: The Power Behind Relevant Campaigns...................................11
Different Types Of Data Impact Promotional Strategies.............................................. 12
Mobile POS: The Near Frontier.................................................................................. 14
Advancing The Overall Benefits Of Mobile Technology .............................................. 15
In-Store Wi-Fi Trends................................................................................................. 16
Embracing The Future With New Technology Investments......................................... 17
Conclusion................................................................................................................ 18
Respondent Demographics....................................................................................... 19
About Yes Lifecycle Marketing...................................................................................20
About Retail TouchPoints...........................................................................................20
Table of Contents

Introduction
Retailers emphasize that providing the best possible experience for customers is a
top priority. But are they implementing the strategies and technologies to deliver on
that promise? Innovative marketing technologies designed to articulate customer
relevancy, trigger engagement, excite shoppers and elicit cross-channel sales are
becoming more sophisticated and often more affordable by the day.
Please rank these factors regarding the importance when it comes to
obtaining approval for investments in sales and marketing technologies.
Ranked 1 on a scale of 1-5
We want to provide the best possible
experience for customers with our brand 65%
We need to constantly be experimenting to learn
what works the best to serve our customers 14%
We need to make investments to lower our cost
of doing business 7%
We need to keep up with what our competitors
are doing 14%
Key Findings
A recent survey of 100 retail executives, conducted by Yes Lifecycle Marketing,
collected candid responses to marketing and technology questions. Among the
key fidings:
• Retailers are lagging in their adoption of technology. For example, less
than one third of retailers have implemented tools such as: in-store Wi-Fi
(32%), mPOS (26%), and purchasing through social channels (24%).
• Retailers are struggling to combine multiple sources of data. Leveraging
customer data was the greatest concern for 84% of retailers.
• A small percentage of retailers are integrating campaigns across
channels. Just 37% said they are providing a consistent multichannel
marketing message across all channels.

Though marketers are inundated with consumer information, much of it is
fragmented across channels and internal/external silos, according to a recent study
from Yesmail Interactive, in conjunction with Gleanster Research. Lack of alignment
constrains marketers as they seek to meld customer data with marketing strategies,
program creativity and results measurement.
However, “7 out of 10 organizations easily could boost customer profitability, capture
more revenue and increase customer satisfaction if they had access to a more robust
and sophisticated view of customer behavior, purchase history, socio-demographic
data, household information and propensity to purchase data,” said Ian Michiels,
Principal and Managing Director of Gleanster Research.
Following is a summary of the 9 key marketing, data and technology issues retailers
face most often and how they plan to tackle them.
Please rank these marketing issues, in order of greatest concern.
Effectively utilizing the data
we already have
Integrating new data
Finding the right technology
Obtaining buy-in from senior management
47%
Using analytics
11%
Integrating social/mobile
18%
8%
8%
8%

I. Marketing Budgets Span Channels
To best reach the goal of
providing stellar customer
experiences, retailers are
committed to marketing
across all channels, with
brick-and-mortar stores
receiving the greatest
percentage (72%)
of funding.
Retailers anticipate that by
2018, brick-and-mortar
stores still will receive the
greatest share (50%) of
the marketing budget.
They also revealed that
some marketing dollars
would shift from brick-
and-mortar to other
channels. This move
seems to underscore
retailers’ ongoing
commitment to
marketing across
all channels.
Please rank the following channels in terms of percentage of
annual marketing budget dedicated to each in 2013.
Brick and mortar stores
Online (brand website)
Mobile (smartphones)
Social channels
Mobile (tablets)
72%
22%
2%
2%
1%
anticipated annual marketing budget dedicated to each by 2018.
Social channels
Mobile (tablets)
50%
31%
9%
5%
4%

Continued support of
brick-and-mortar makes
sense, since this channel
generated in the greatest
amount (76%) of annual
revenue in 2013, and is
expected to continue on
that trend.
More specifically, retailers
anticipate that by 2018,
the brick-and-mortar store
would still generate as
much as 70% of
annual revenue.
This report also identifies
which technologies
retailers believe will be
most effective in the next
five years, along with
some surprises.
The overarching question
for retailers is: Where
does your company stand
in the commitment to new
technologies, customer
relevancy marketing and
exceptional customer
experiences, compared to
100 of your
surveyed peers?
Please rank the following channels in terms of percentage of annual
revenue in 2013.
Social channels
Mobile (tablets)
76%
18%
2%
2%
2%
anticipated annual revenue by 2018.
70%
24%
0%
Social channels
Mobile (tablets)
3%
3%

II. Facilitating Marketing Efforts
Across Channels
Multi-source customer data accessed before, after or during a retail transaction
can assist marketers in a multitude of cross-channel initiatives, such as message
continuity. Yet 63% of survey respondents said they are not providing consistent
marketing messages across all channels. Half of marketers said they coordinate
marketing campaigns across some channels, and 13% admitted that their marketing
efforts are isolated within individual channels.
Please describe your current marketing strategy.
We provide a consistent
multichannel marketing
message across all channels
We market within each
channel separately
We coordinate marketing
messaging across some,
but not all, channels
50%
37%
13%
This means that today, when the industry is more intent on multichannel consistency,
just one third of marketers are integrating campaigns across all channels.

To succeed, retailers must become more deliberate about consolidating cross-
channel marketing efforts, said Ian Michiels, Principal and Managing Director of
Gleanster Research: “The future of brand marketing is about building relationships
through relevant and timely communications delivered across the channels each
customer prefers. Companies need to start thinking in terms of the customer lifecycle
and relying more on the data and insights that inform and develop the applicable
lifecycle strategy.”
Moving The Needle On Social Commerce
Consolidation becomes more vital as changing customer behaviors alter retailers’
demands for channel technologies. For example, Facebook and other social
channels initially failed to develop as direct sources of revenue: only 24% of retailers
surveyed deploy social purchasing today. But by 2018, almost half (46%) plan to
leverage social as a way to facilitate direct purchasing.
Please indicate if you have deployed purchasing through
social channels or plan to by 2018.
24%
46%
30%
Planned by 2018
Not planned
Deployed
today

Real-time isn’t yet ready for prime time: Only 23% of
marketers reported using real-time data to generate
customer offers on a regular basis; 30% said they use
real-time data, but infrequently; and 36% would like to
leverage it. Another 11% said they are not able to use
up-to-the-moment data to generate customer offers.
Of the offers generated by the 53% of retailers who
utilize real-time data, most (38%) are triggered by
website purchases, followed by in-store visits (37%)
and in-store purchases (36%).
Are you able to use real-time data to generate
customer offers?
Yes, but
we do so
No
No, but we
would like to
36%
30%
11%
23%
Yes, and we do
so frequently
Which of these events trigger real-time offers
to your customers?
Website purchase
In-store visit
In-store purchase
Website visit
Email response activity/
Shopping cart abandonment
Customer location (geo-
Life event (birthday, move,
Not applicable
38%
37%
36%
35%
34%
30%
29%
24%
24%

To confirm these statistics, a 2013 IBM survey of more than 500 companies
worldwide segmented the top performers in terms of cross-channel integration
and the use of technology for customer outreach. Among this subset, 40% actively
provided real-time customer offers based on customer context — a “relatively
sophisticated process,” according to a June 2013 eMarketer article. Among the
remainder of companies surveyed, only 15% had generated real-time offers based
on context during 2013. The key to real-time marketing, eMarketer indicated, is to
“use data and analysis to deliver real-time messaging through automated technology,
which can rapidly respond to customer actions by pushing out ads, marketing
collateral and other content to the appropriate channels.”
In addition, “retailers can leverage apps that customize offers individually, in real time,
based on a customer engagement event and/or what retailers already know is in a
customer’s closet, locker, garage or pantry,” said Boston Retail Partner’s Morris. “As
more store offers become real-time, back-office processes will change considerably.
In fact, real-time retail has the broad potential to impact everything from the store to
workforce management, loss prevention, merchandising, the home office and more.”
The reality is that many retail marketers struggle with real-time offers because
available customer data is difficult to align and centralize. Extracting and leveraging
non-integrated customer data makes most marketing programs ineffective, as do
the fragmented legacy technologies often supporting the data. This especially is
true for retailers that engage multiple agencies, marketing service providers and
technology vendors.
However, the retail industry can now access next-generation customer lifecycle
engagement solutions capable of addressing the real-time marketing challenge.
More powerful digital technologies; faster transmission speeds; the ability to access
centralized, core systems of customer data; and more affordable
pricing have helped create this shift. In addition, the essential, always-
on smartphone — a prime avenue for delivering real-time offers — has
become a ubiquitous touch point.
Combined, these developments are moving real-time marketing to the
forefront of advanced customer engagement and relevancy marketing
techniques. The shift is great news for the 89% of surveyed retailers who
are or would like to leverage real-time marketing practices.
“Real-time retail
has the broad
potential to
impact everything
from the store
to workforce
management,
loss prevention,
merchandising,
the home office
and more.”
-Ken Morris
Boston Retail Partners

IV. Effective Use of Data: The Power
Behind Relevant Campaigns
Retail marketers strive to capture, analyze and utilize the right amount of customer
data in order to maximize the relevancy and impact of marketing offers and
campaigns. Today thousands of data points deliver information about customers’
personal interests, family make-up, products last purchased, age, residence,
at what hour they are most likely to open and click through an email, and much
more. Marrying all or parts of this data treasure trove with innovative marketing
technologies creates the power that pierces through customer engagement barriers.
As noted in the chart on page 4, almost half (47%) of surveyed executives ranked
utilizing existing customer data as their primary marketing challenge. Integrating
social/mobile data (18%) and new data (8%) as well as using analytics to explore
data (11%) also topped the list of greatest concerns. In total, leveraging customer
data was the greatest concern for 84% of surveyed retailers. Findings underscore
marketers’ ongoing struggle to combine multiple sources of data to deliver the
customer relevancy and personalization required for improving the experience for
customers across channels.
Do You Want Fries With That?
Some retailers do an excellent job of increasing basket size based on customer
profiles and previous behaviors. But for most retailers the act of capturing, cleaning,
processing and updating cross-channel data is difficult to manage.
But today, retailers that find the right partners can blend multi-source customer
data to target, personalize, cross-sell, up-sell — more thoroughly, quickly,
effectively and affordably than ever before. Retail marketing partners specializing
in customer intelligence are ready to share synchronized databases of extensive
customer information — available in real time. For example, mobile sales associates
equipped with a customer email address or portion of a mailing address can tap
into contextual customer data that many retailers never knew existed.
Consumers interacting with their smartphones, tablets, laptops and
desktops can access real-time marketing offers triggered by an in-store
visit, website purchase or other event.
Leveraging
customer
data was the
greatest concern
for 84%
of surveyed
retailers.

V. Different Types Of Data Impact
Promotional Strategies
The majority (58%) of surveyed retailers indicated that transactional and purchase
history data are the most valuable types of customer information. Only 5% said
social media data was the most valuable, and only 2% valued web browsing history
data above all other types.
What type of customer data do you think would be most valuable to you,
regardless of whether you currently collect it?
Transactional/purchase history
Behavioral/attitudinal data
Demographic information
Campaign response history
Social media data
Web browsing history
58%
14%
14%
7%
5%
2%
Marketers may be wedded to transactional information because it is easily accessible
and offers explicit customer data, ideal for segmentation and offer optimization.
Social media and web browsing data is more difficult to embrace because it reflects
a shopper’s inferred intent only.
“Social data provides a valuable and unique opportunity for retailers to determine
what people are saying about their products and customer service as well as
determining where there is “buzz” that may be relevant,” reported Michael Penney,
Managing Director of Agency Services for Yes Lifecycle Marketing. “But the value
of that data is limited because its impact is not as actionable and measurable to
retailers.”

However, “just because you know what your customer purchased doesn’t mean you
know your customer,” stated Michiels. “Marketers need to layer on third-party data,
as well as online and offline data, to really engage customers on an intimate level.
Unfortunately, that is not happening very well today, even at the largest and most
innovative B2C organizations.”
Most consumer-facing companies have an undeveloped understanding of their
customers beyond basic demographics and purchase history, Michiels said. In fact,
“many executive level marketers think they know their customers well, and consider
their customer engagement strategies — including optimal messaging, channels and
timing — to be effective. In reality, they lack the deep data insights that would enable
them to send personalized, targeted campaigns based on relationship-oriented
customer data. This suggests that most retailers are limited by what they perceive to
be successful albeit legacy marketing tactics.”
“Just because
you know what
your customer
purchased
doesn’t mean
you know your
customer.
Marketers need
to layer on third-
party data, as
well as online
and offline data,
to really engage
customers on an
intimate level.”
-Ian Michiels
Gleanster Research

VI. Mobile POS: The Near Frontier
The majority (51%) of retailers acknowledge that mobile POS (mPOS) is a must-have
by 2018.
However, almost one quarter (23%) have no plans for this strategy, possibly waiting
to determine which companies/facilitators and technologies will rise to the top.
In the meantime, Best Buy Canada, Home Depot, Nordstrom, Perry Ellis and Urban
Outfitter are just some of the retailers currently embracing mPOS.
Perry Ellis pursued mPOS primarily for clienteling, said Luis Paez, CIO of Perry Ellis
International, in an article published by Retail TouchPoints. “Being able to approach
and work with the customer more effectively was very important. Employees and
store managers now are equipped with the tools to build that relationship with
shoppers and create more interactive experiences.”
At Best Buy Canada, mPOS “is just one part of our multichannel offering that
allows for a flawless experience, in-store and online,” said Robert Pearson, VP of
E-Commerce for Best Buy Canada, in another Retail TouchPoints article. “Our focus
is on creating a seamless shopping experience for our customers and we have
invested in building out both our multichannel and fulfillment capabilities to support
this vision.”
Please indicate if you have deployed Mobile POS or plan to by 2018.
26%
51%
23%
Planned by 2018
Not
planned
Deployed
today

VII. Advancing The Overall Benefits Of
Mobile Technology
There’s no question that as mobile technology continues to improve, retailers will
have an increasingly powerful and flexible vehicle for capturing customer data and
triggering increased sales. Mobile tools facilitate more intimate discussions with
customers and therefore better relationships. Equipped with mobile devices, sales
associates can glean valuable information as they help customers browse and buy
— then use that knowledge to generate synchronized, cross-channel customer data
for new and developing sales strategies.
Based on the breadth of customer data collected, with mobile technology in-
hand, associates can improve the brand’s value proposition. For example, they
can provide more relevant offers or adjust offers in real time — change a $5-
off proposal to $50 off — to capture a sale. Developing a more personalized
approach, store associates could snap a photo of a customer; determine the size
and color of jeans previously bought in-store or online; produce an image of the
customer wearing a matching top or jacket; then click to order it in the size, color
and delivery method the buyer prefers.
This “guided selling” technique is the future of retailing, said Ken Morris, Principal
of Boston Retail Partners. The next step in mobile “will create a true customer-
centric omnichannel shopping experience where a sales associate can be
empowered to interact with customers in new and innovative ways. Retail is
never going to be the same.”

VIII. In-Store Wi-Fi Trends
Surprisingly, almost 40% of retailers had no plans to deploy free in-store Wi-Fi,
despite the rise in mobile.
Wi-Fi deployment trends could depend on how a retailer perceives the customer
experience: For smaller retailers that can deliver effective engagement strategies over
cellular networks, investments in in-store Wi-Fi may not be imperative.
But for retailers intent on delivering sophisticated customer experience apps that
necessitate extensive bandwidth, free in-store Wi-Fi is highly valued. Personalized
offers made by sales associates equipped with mPOS, delivered directly to
shoppers’ mobile devices, or available from tablets affixed to store shelves, for
example — all streamlined by access to centralized customer data — require robust
Wi-Fi implementations.
“Retailers want technologies that give their customers a reason to come to
their stores,” said Penney “and for many consumers, in-store Wi-Fi will enable
those reasons.”
Going forward, Penney sees retailers taking one of two approaches: “Some
marketers will advance the quality of customer engagement execution by developing
sophisticated personalization strategies that demand the capacity of in-store Wi-Fi.
Other marketers either won’t require the bandwidth provided by Wi-Fi — or believe
that in a few years, communications carriers will provide adequate bandwidth to
power sophisticated apps to mobile devices.”
Please indicate if you have deployed free in-store Wi-Fi or plan to by 2018.
32% 29%
39%
Planned
by 2018
Not planned
Deployed
today

IX. Embracing The Future With New
Technology Investments
Retailers are lagging in their adoption of technology: less than one third of retailers
have implemented tools such as free in-store Wi-Fi (32%), mPOS (26%) and
purchasing through social channels (24%).
Only easy-to-implement QR codes are close to being widely adopted, with 45% of
On a macro level, the recent recession challenged most retailers in terms of
technology investments. In addition, many solutions require adjunct expenses,
such as upgrades to legacy hardware, further slowing technology adoption. Some
retailers still are focused on the most fundamental applications, such as capturing
contact information. Others concentrate on investments that lower the cost of doing
business or mirror competitors’ next operational moves, rather than on technologies
that can enhance the customer experience.
Please indicate if you have deployed the following technologies or plan to by 2018.
In-app
purchasing
Geo-targeting/
localization
Shoppable
videos
QR codes RFID tags
29%
45%
26%
30%
46%
24%
21%
40% 39%
45%
33%
22%
18%
33%
49%
Deployed today
Planned by 2018
Not planned

As noted, providing the best customer experience was the No. 1 factor for most
(65%) of retailers seeking approval for sales and marketing investments. “The lion’s
share of technology investment, therefore, should be going to solutions that enrich
the customer experience and break through engagement barriers,” said Penney.
“The most compelling, integrated personalization marketing campaigns rely on a
cohesive repository of customer knowledge. Brands that don’t invest in providing the
relevancy will falter as consumers seek competitive brands that do.”
Conclusion
The battle for market share now rests on building and leveraging intimate
customer relationships.
“Winners are embracing cross-channel marketing techniques that create and
communicate true customer relevancy, trigger engagement and lift sales, said
Penney. “The gap between retailers utilizing these techniques and those that don’t is
growing wider.”
Penney continued: “Catching up will require significant realignment and investment
in technologies that deliver relevant data-driven customer marketing. Meanwhile,
retailers already focused on leveraging customer data to provide relevancy are
developing distinct advantages in the marketplace.”
With advanced business intelligence (BI) tools in hand, retailers will be able to
collect actionable data that identifies the right customers at the right time in order
to implement more effective marketing strategies. The best BI solution partner will
deliver a custom mix of products and services tailored specifically to your business
and customer.
“The gap between
retailers utilizing
these techniques
and those that
don’t is growing
wider.”
- Michael Penney

Respondent Demographics
Of the 100 retail executive respondents, most (30%) represented specialty hard
goods, big box (20%), grocery (12%) and specialty soft goods (12%). The remainder
represented electronics, pharmacy/convenience and office supplies.
Please describe your retail vertical.
Specialty hard goods
30%
Specialty soft goods
12%
Big Box
20%
Pharmacy/convenience store
8%
Grocery
16%
Electronics
9%
Office supplies
5%

About Yes Lifecycle Marketing
Yes Lifecycle Marketing is a solution provider that brings together
multichannel marketing platforms and data, with creative and strategy
services honed on the optimization of delivering relevant marketing
messages. This gives marketers the ability to source best-of-breed
technology and creative and strategy services from a single vendor at a
cost-effective price point. For more information, visit:
www.yeslifecyclemarketing.com
About Retail TouchPoints
Retail TouchPoints is an online publishing network for retail executives,
with content focused on optimizing the customer experience across
all channels. The Retail TouchPoints network is comprised of a weekly
newsletter, special reports, web seminars, exclusive benchmark
research, an insightful editorial blog, and a content-rich website
featuring daily news updates and multi-media interviews at
www.retailtouchpoints.com. The Retail TouchPoints team also
interacts with social media communities via Facebook, Twitter
and LinkedIn.
200 W Adams, Suite 1400
Chicago, IL 60606
P: 877.937.6245
sales@yeslifecyclemarketing.com
411 State Route 17 South
Suite 410
Hasbrouck Heights, NJ 07604
P: 201.257.8528
F: 201.426.0181
info@retailtouchpoints.com

Breaking Through Customer Engagement Barriers

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