Harnessing the power of data for Victoria's recovery

A personal touch with customers has long been the hallmark of a successful business, and in the post-Covid-19 era, this will be no different. But with today’s technological possibilities, harnessing the power of data will be an essential driver for recovery strategies, write Sudha Viswanathan and Francois Ehly from Pitcher Partners.

Loyalty is a valuable commodity for business, with studies showing a growth of 5 per cent in customer retention can result in profit increases of 25 per cent or more. Building trust and loyalty with customers through personalisation was an important goal as the rapid shift to e-commerce occurred during the Covid-19 pandemic.

Businesses bore much of this burden alone and Governments have a role to ease the burden by deploying measures that drive confidence and investment in the post-pandemic world, because even with a blossoming e-commerce platform, business alone cannot power the recovery.

Melbourne

Melbourne’s status as a commercial stronghold is suffering. More than 600,000 Victorians were either unemployed or under-employed in October and people have only just started to return to Melbourne’s CBD – an absence that has crippled businesses that rely on foot traffic.

Yet the response from the Victorian Government in the recent State Budget to drive investment was limited, with measures such as temporary payroll tax credits rolled out instead of embracing genuine reform.

Businesses cannot afford to stand still, and they need to become more data-focused than ever to ensure they not only rebound from the pandemic but return stronger than before the crisis. In practise, this means being agile and tapping into the information that is now readily available from newly minted e-commerce platforms.

Data is crucial to personalising interactions with customers. Beyond the economic recovery from Covid-19, personalisation is a society trend driven by millennials who look local and respect values such as products created from local-sourced materials.

Online shopping

Almost overnight in March, organisations were forced to move from a brick-and-mortar model supported by an online presence, to existing solely in the digital marketplace. Many companies quickly pulled together a website for online sales or to facilitate click-and-collect for the first time earlier in the year without considering what the customer experience might be like.

It didn’t take long for people to be drawn to online retail. One in five Australians made their first purchase from a new website between March and August, according to Australia Post, and Victoria became the online shopping capital of the nation. But many people were also left unsatisfied by their initial online interactions. The same Australia Post survey showed almost half of those customers were either unsure or said they would not shop online with that retailer a second time.

First impressions are everything in online retail because, with so much competition, it’s hard to entice people back after a poor digital experience. Luckily, the weapon that allows business owners to personalise customer offerings also allows them to pinpoint problems.

Data-driven insights

The data allowed business owners to identify customer experience issues and online behaviours that drove them away, rather than use guesswork. The key question business owners must ask themselves is, how well do I really know my clients, their habits and preferences?

E-commerce platforms are more than just a channel for click-and-collect and one of the characteristics of businesses that have thrived since the outbreak of Covid-19 is productive use of the insights gathered from online interactions. Insights from customer data help business owners learn more about customers than ever before, to innovate and tap into new markets, and tailor online interactions to the individual.

Sudha Viswanathan is Director of Analytics and Insights at Pitcher Partners, Francois Ehly is Data Science Manager at Pitcher Partners.