Fifteen years covering retail and I’ve seen numerous power shifts take place within the retail enterprise. The CIO was king at Y2K and around the tech boom, the CFO during the economic crisis, the e-commerce guys had their day, and the Chief Merchant has ruled the roost off and on for decades.
The ‘customer-centricity’ mantra has been written about and dissected for several years now and is still by and large a concept that the industry buys into. So it is no wonder that marketing, a function that has largely sat in the shadows in the retail world, has come to the fore.
Marketing executives have been gathering sales and campaign data in their own silo for years and using that data to drive promotions and sales. It stands to reason that every department wants access to this data. We have hit a tipping point where technology is able to deliver on the promise of delivering insight into purchase behavior/patterns as well as ‘one view of the customer.'
So while it may feel like an overnight phenomenon, the marketing function has at last become very important in the retail enterprise. The ultimate validation of this theory is the fact that in the last few weeks I’ve talked to several vendors that have historically targeted IT, who told me they are now targeting marketing executives for their solutions!
In addition, I’ve spoken to several retailers in the last six months have hired a Chief Marketing Officer. My first question has been—“Are you looking to better synchronize marketing with merchandising?” As we know, merchants have historically been the ‘lone wolves’ of retail and they have until recently fought the introduction of science into the art of retail. However, to my surprise, most retailers have answered that yes, they are looking at synchronizing marketing better across all departments, including merchandising.
It is generally accepted at this point that consumers are driving demand, so retailers' ability to harness ‘structured’ purchase data as well as ‘unstructured’ behavior data (e.g. social media metrics) has become a must. The unstructured data, in most cases, sits in marketing and everyone within the organization wants to get their hands on it. This is not to mention the customer loyalty program data that also sits in marketing in most organizations. These factors have combined to give marketing a new source of influence in the organization.
The good news is that several vendors now offer analytics with accompanying dashboards for different functions (i.e. marketing, merchandising, IT) that enable each department to view the same data points in the manner that is most useful to them. Of course this requires a centralized customer database—something that still needs work at most retailers. However, customer analytics are a competitive differentiator that can be used across departments and can be especially useful in marketing (see Rethinking Customer Analytics for the Age of All-Channel Commerce
And while these tools are better than ever, and even though marketing will continue to play a larger role in the retail enterprise, the real value will be realized when retailers learn to synchronize marketing with IT, merchandising, and operations, so that a ‘customer-centric,’ ‘engagement-centric’ or ‘customer-aware’ strategy can be real.