Data-rich loyalty programmes can boost retail businesses in SA
"In May this year, the market research firm BrandMapp and consultancy Truth published their 2023/24 Loyalty Whitepaper, which revealed that 76% of South Africans now use a loyalty programme in some form or another,” comments Stefan Gerber, Co-Founder at Tregter.
The study confirmed that 30% of respondents were using loyalty programmes more than the previous year, indicating that consumers are eager for discounts or deals against the backdrop of a rising cost of living in our country.
Gerber believes that consumer demand for financial relief from loyalty programmes is increasing, providing a golden opportunity for businesses that manage data-heavy systems: “As digital technologies continue to evolve rapidly, so will companies, whether in retail or otherwise, evolve in how they choose to manage their data and the systems they use to leverage it.”
That being said, he cautions against businesses rushing to integrate artificial intelligence technology into their operations to streamline business processes without pausing for thought on the current condition of their data management systems.
“Before advancing their systems into the age of intelligence, companies must adopt the principle of effective data management. If you were to simply skip this step and input garbage data into your AI applications, garbage data is bound to be the product. Businesses that are heavily reliant on data should avoid scrambling to collect it on an ad-hoc basis. To leverage AI to its true potential, businesses need to begin with data warehousing first,” adds Gerber.
Begin with data warehousing
A data warehouse is a centralised depot that stores data from numerous sources in a single location, making it easily accessible and crucial in supporting business intelligence and analytics.
Gerber explains: “To make this more relatable, imagine a big library with countless books, with each book representing a different type of data, such as sales, customer information, or website engagement. A data warehouse is like a catalogue that collects and organises all these books into one place, enabling the user to find specific information more easily, see relationships between different data points, and gain valuable insights.”
“The work of a data warehouse is complemented by the functioning of a customer data platform (CDP), a software application that collects, unifies, and organises customer data with the primary purpose of providing a single, comprehensive view of each customer, allowing for personalised marketing, sales, and customer service. In simple terms, think of a CDP as a magic scrapbook that collects and combines all the relevant information about each customer from various sources. In summary, the data warehouse is the repository for all data, while the CDP uses this data to create a personalised view of each customer,” shares Gerber.
Providing consistent and cohesive brand experience
Omnichannel experiences will also prove useful in this economic environment according to Gerber, and refer to integrated customer experiences across multiple channels and touchpoints, whether online or offline.
The goal of an omnichannel approach is to provide a consistent and cohesive brand experience for customers, regardless of how or where they interact with a business. An example of an omnichannel experience in retail would include the process of a customer browsing for a product online, checking in-store availability, and then picking up their purchase at the physical store.
On top of personalisation and omnichannel experiences, data warehousing and CDP systems also help businesses satisfy another desire of today’s digital consumer: instant responses and feedback.
"If you can use these tools in a manner that leverages AI-based analytics, you can guarantee a rapid transformation that will make your company far more competitive in the South African (and even global) market. This is exactly what makes a retail giant like Shoprite so successful, especially when executed through its various loyalty programmes. With the right data management systems in place, aided by machine learning infrastructure, any business has the potential to build a data kingdom like Shoprite and retain customer loyalty through personalisation and instantaneous feedback,” concludes Gerber.
In the age of intelligence, where data is the new currency, businesses that prioritise effective data management and leverage AI-driven insights will be the ones to reap the rewards of loyalty, retention and ultimately, reign supreme in the market.
