Countering the 'filter bubble' effect in retail
None of us likes to be pigeonholed, told that we’re a certain kind of person. Yet equally, when we go into a store or we shop online, we want personalised service. We want retailers and retailers’ staff to understand us.
It’s not often highlighted, but within modern retail there’s an inherent tension here. As companies increasingly base their offerings on customer data, the risk is that these offerings are based on patterns of behaviour that may not reflect an individual’s tastes and circumstances. Many of us will have had the experience of, for example, searching for garden furniture online, hardly a regular purchase, and finding we’re shown patio chairs long after we’ve bought a set.
It’s the filter bubble effect and it can have a huge impact on profitability. So what can retailers do to counter this kind of scenario? Firstly, we should be clear we’re not arguing against personalisation. Rather, the filter bubble often occurs when personalisation is implemented with insufficient care and subtlety, and when personalisation is based on incomplete or inaccurate data.
In contrast, get data ‘right’ and businesses can be quicker, more agile. For this reason, it’s as important as ever to work towards getting a single view of stock, sales and customers (learn more). Get that data updated live to all your channels and staff, and you have a much better chance of offering a customer experience that’s genuinely personalised rather than simply offering products based on crude segmentation.
To implement this kind of sophisticated personalisation, retailers need rich data from their consumers. That means sustaining conversations with customers who are often very well informed not only about retailers’ products and services, but about the value of their own personal data too. Indeed, as GDPR legislation comes into effect, we can expect customers to become even more conscious of the importance of data, to expect more personalised and tailored offerings in return for sharing information.
This new business landscape can seem daunting, yet there are tried and tested techniques for reaching out to customers. Well-implemented loyalty schemes, for instance, are a great way to begin and sustain conversations.
In addition, while automation is often seen through the prism of retail jobs being lost, what’s less often talked about is the idea that sales staff need to be more highly trained in order to offer a better customer experience. In the future, clienteling won’t necessarily just be the preserve of high-end retailers and multichannel businesses need to make sure their sales assistants are at least as knowledgeable as smartphone-wielding consumers.
To return to where we began, the prize for retailers that do get things right here is to move beyond the customers-who-bought-this-also-bought-this filter bubble towards personalised conversations that, it follows, in turn yield far richer data on which to base future conversations.
To read more about how to make buying experiences better for your customers, download the Internet Retailing IREU Top 500 Customer Dimension, proudly sponsored by Cybertill.