Inflation is increasing by 8.5 percent compared to last year. Major sectors such as food and gas are leading the trend with double-digit price increases, but all retail categories are affected.
In this environment, customers are often unpredictable, more sensitive and more demanding. Delighting the customer is essential to retention and revenue, and rapidly rising prices are challenging retailers to maintain customer satisfaction without losing money.
Brands cannot be in a reactive position right now. Successfully navigating a volatile economy requires a thoughtful, informed approach. Retailers must adopt data-driven strategies, relying on analytics and technology to make intelligent decisions on pricing, inventory, promotions and customer experience.
Analytics can explain apparently ambiguous customer behavior and predict future behavior and preferences to ensure brands don’t lose key customers. Powered by artificial intelligence, digital experience intelligence tools capture and analyze 100 percent of online customer interactions, providing companies with key insights, actionable recommendations, and data-backed predictions.
Retailers can use this information to determine which products are eligible for price increases, when is the best time to change prices, and how to adjust inventory levels to reflect changes in demand. Predictive analytics can also be used to automatically deliver tailored pages or products to customers based on customer data, which can increase conversions and loyalty.
Ultimately, incorporating predictive analytics into all aspects of the company enables brands to use their resources more efficiently, saving them money and improving their ability to quickly adapt to inflation.
Leveraging VoC Intel
Voice of the customer (VoC) encompasses customer feedback, allowing businesses to better understand customer preferences, needs and expectations. With ongoing pricing and/or merchandise fluctuations, it is important that brands continue to analyze VoC data to identify how the changes are affecting customers. Business leaders can leverage this information to identify the most frustrating areas for customers, then prioritize changes to minimize any revenue loss.
Customer service analysis
It’s important to collect all digital customer experience data because many consumers never reach out after a disappointing experience (they’ll take their business elsewhere). Viewing and analyzing information generated by the customer support team will provide the brand with clear and unambiguous customer feedback.
Customer service analytics can be used to identify key pain points, which teams can use to make informed decisions, ideally providing solutions in real time.
Creating great experiences in the unknown
Margin-slimming inflation is out of a business’s control, but they can control the quality of their customer’s digital experience.
The emphasis should be on creating a seamless, personalized customer experience, using data to improve all aspects of the customer journey. If customers are happy with their experience, they may be willing to ignore select price increases.
To further improve customer satisfaction, brands should consider opportunities for deals/promotions, determining which products are most important to maintain low prices. To make a margin, retailers may raise prices on other less sensitive items.
With inflation showing no sign of leveling out, retailers must prepare for the future. A customer-centric, data-driven approach will help brands chart uncertain waters. All brands need sophisticated analytical tools and technology to help them overcome inflationary challenges with agility and flexibility.
Gaby Koren is Chief Revenue Officer at Glassbox, a digital customer experience analytics company.