By Andy McNab, VP EMEA at Fanplayr
The UK’s relaxation of lockdown restrictions is set to expose how some brands have become disconnected from consumers during the coronavirus crisis. In the post-Covid economy, companies need new technologies to understand customers and their preferences and persuade them to book holidays, hospitality and leisure experiences or return to stores and showrooms.
A survey by global management consultants McKinsey in February found 72 per cent of UK consumers have changed stores, brands or the way they shop as a result of Covid, while 92 per cent say they will continue purchasing online. Big prizes are at stake for all brands in this new and less familiar landscape, considering that Britons have amassed £180bn extra in savings during the pandemic.
For many brands the shift from physical retail is part of their strategy, recognising that consumer behaviour has changed forever. But for more considered retail purchases such as new kitchens, furniture, vehicles, or luxury goods, consumers will still want to come into a store or showroom. Brands in these sectors will have to understand consumers better and tempt them back, not just with Covid-related safety measures, but with the right offer and the right experience.
In the travel sector, for example, as restrictions ease, consumers may prioritise visits to family and friends overseas over more traditional beach holidays. There are many variables. Companies need to know whether prospective holidaymakers in their niche or segment are ready to congregate with large groups of strangers again. Automotive companies and their dealerships want to know if car buyers are seeking to reward themselves with a higher spec new model or have new responsibilities that require a more practical vehicle.
It’s not just the consumer sector that needs greater understanding of consumer behaviour. Any company that wants to optimise its website – whether in professional services or wholesale – needs to know who and how to prioritise from thousands of visitors.
More personalisation insight from consumers’ website behaviour
Addressing these challenges requires a more insightful, 360-degree view of prospective customers that triggers personalised communications based on each individual’s behaviour.
The most critical element in all this is consumer behaviour on a company’s website. Firstly because of the mass shift to online and secondly because it generates the best possible insights into what interests individual consumers and what will encourage them to become customers.
But the ability to make the right offer or intervention at the right time based on personal preferences requires insights from AI-power segmentation and behavioural analysis. If brands are to build refreshed or new relationships with consumers, they will need AI-driven technologies to analyse and act on the data generated by consumers visiting their websites.
This is not just more sophisticated, it is also more effective, more profitable and is an approach for the long term. It overcomes all the difficulties that will arise next year when Google joins the other big browser companies and bans the use of third-party cookies, which have provided the data fuel for marketing and advertising for years. We can see from Google’s own analysis how this ban may reduce revenues. Google analysed the 500 largest Google Ad Manager publishers globally over three months and found that where no cookie was present, revenues fell by an average of 52 per cent compared with traffic where there was a cookie.
The new AI-driven segmentation technology stores just the unique ID of the user in a first-party cookie, in a similar way to Facebook. This means it is not affected by the third-party cookie ban or privacy restrictions such as EU GDPR (General Data Protection Regulation) or the CCPA (California Consumer Privacy Act) in California.
The first-party cookie remembers each visitor and their visit. Then, as the consumer moves around the brand’s website and examines products, explores features or places items in their basket, the AI solution behind it generates important insights. It will show, for example, when a consumer’s behaviour indicates they are close to buying, or, when they are about to leave the website.
Real-time analytics enable the brand to deliver a discount, offer, promotion or recommendation at exactly the right moment, using the consumer’s current and previous behaviour and what they may have put in their basket. This guides a consumer through their journey with persuasive recommendations and avoids the highly unprofitable scatter-gun approach, firing off discounts at consumers without any insight into whether they work or are even necessary.
A company will see from its metrics how this type of segmentation and interaction technology raises conversion rates, average order values and revenues per visit. It also increases the chances of customers remaining loyal by improving their overall experience. The online merchandise store of a famous Italian car brand found, for example, that after just a month of using this approach, revenues with its target segments had risen by 35 per cent. The average order value was up 29 per cent. Average order value increases of 130 per cent are common after longer periods of implementation.
In the post-Covid economy, brands will also need to engage with consumers across multiple channels. AI segmentation and personalisation will deliver this as part of single, integrated platform. This generates the data and analysis to personalise marketing content in SMS messages and emails sent to consumers who consent. The precision of this marketing delivers far better results than standard approaches. It also has many advantages in efficiency, simplicity and ease of implementation compared with a complex of separate solutions for different parts of the customer journey such as reduction of basket abandonment or upsell tactics.
This is the optimum approach, given that the ban on third-party cookies is looming. Apple and Firefox have already ended third-party cookies, but with more than 60 per cent of the browser market, Google’s decision is the most significant.
This will have major consequences, ending the flow of data from third-party cookies about where customers go online and what their browsing habits are. Unless organisations implement far more innovative personalisation solutions using their own website data, they are likely to witness a big dip in revenues instead of bridging the gap with consumers to reap the rewards of consumer “blow-out” expenditure. They will pretty soon find the market has left them behind and they no longer understand what their individual website visitors and customers want, nor can they intervene effectively.
If brands act now to put AI-powered segmentation in place, they can rebuild relationships with consumers beyond the immediate relaxation of pandemic restrictions. They forge new connections with new website visitors and overcome the loss of insight from the ban on third-party cookies. From retail to travel, brands will have the power to interact quickly in a targeted, personalised and unobtrusive way to provide a better a outcome and experience for everyone, tempting consumers back to stores, showrooms, airports and hotels.