August 1, 2023 ↘︎

Why retailers should be like Kmart and Target and review their tech stacks

As marketing budgets continue to shrink, many in the C-suite are trying to find ways to save money while maintaining, or preferably increasing, sales.

As marketing budgets continue to shrink in the face of economic uncertainty, many in the C-suite are trying to find ways to save money while maintaining, or preferably increasing, sales.

It’s no surprise that June data from last-mile delivery platform Shippit showed that people were both spending less on each purchase and making fewer transactions than at the same time a year ago.

If your business is in this boat, and chances are it is, now could be the perfect time to take a good hard look at your back end to see where costs could be reduced.

Australian retail conglomerate Wesfarmers is doing exactly that as it undertakes a merger of the back-end services of its discount department store chains, Kmart and Target.

But it’s not just the retail behemoths that can save money and even improve customer experience with a back-end review. Smaller retailers can, too.

Start with analytics

If customers are both transacting and spending less, it’s important that your customer experience is top-notch. Customer experience (CX) is something that can’t be measured by traditional analytics platforms.

You might see in a report that X per cent of customers stopped their path to purchase at a certain point, but you can’t tell why.

Often product teams ask for new product or promotion pages to be heavily tagged to report on success. These tags are then left racking up server calls long after attention has moved on to the next new thing.

Rather than ‘measure everything’ across the web and apps in your analytics platform, perform an audit of analytics tags to reduce your server call costs. You want to measure only key interaction points.

You can then invest the savings in a CX intelligence tool that will show you not only interaction clicks, but full customer journeys including pain points such as dead links, navigation issues, and aborted checkout journeys.

Some of these tools can even automatically flag a low Net Promoter Score (NPS) customer journey so you can see exactly what issues affected your score.

Think of this as the digital ‘qual’ to your ‘quant’ of analytics, providing a deeper understanding of what’s happening with your digital assets.

Review your systems

As technology stacks grow, it’s common to find systems that replicate part, but not all, of the functionality of an existing platform. This is often because the newer system relies on specific data already captured elsewhere to perform its function. This can create data silos where similar data is captured in multiple locations. The danger here is that the data might not match, and there’s no source of truth.

It’s good practice to map the data systems in use to find overlaps. You can then look at ways to automate data exchange between the platforms to ensure they are all working from the same information. This could be in the form of a data experience platform or a customer data platform, depending on what needs to be shared.

You don’t want to have team members spending their time downloading and uploading files between systems. Not only is this not a good use of their time, but also any manual process creates multiple potential points of failure.

Ways of working

If you’re under pressure to grow revenue through marketing while keeping headcount to a minimum, you’re not alone. A Gartner survey of 405 marketers found that 61 per cent of respondents said they lacked internal capabilities to execute their strategy.

However, larger organisations often find themselves with teams that have overlapping roles where headcount could be deployed to other tasks. Examples of overlap could be separate call centre and online chat teams; teams that are split by product or service category that all manage their own content, paid, and social media, and so on.

Each of these teams has probably developed its own way of reporting, and combining results to see total effectiveness is often difficult. By analysing such situations and revising your ways of working, and the systems in use, you can decrease overhead, standardise reporting and often improve results.

Marketing technology generally accounts for around 25 per cent of any marketing budget; however, it’s a complicated landscape with multiple platforms to choose from for any given task. So you want to have a strategic approach to implementation.

With shrinking budgets, you not only need to find the best tools for your business but also ensure those systems aren’t wasted. If a platform isn’t used to its full potential due to factors such as overlapping features, lack of training, or ingrained ways of working, it’s well-intentioned money down the drain.

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