Understanding what consumers want is foundational to a successful consumer packaged goods (CPG) brand or retail business. You can’t sell what people won’t buy. Furthermore, it allows brand manufacturers and retailers to identify their markets and tailor their products and merchandise mix specifically to those demographics. It’s simply a better way of doing business: The brand or retailer uses data to focus its strategy, make smarter decisions, and run more effective promotional campaigns.
Consumer data collection methods often include:
- Purchase and customer service records
- Focus groups
In the past, consumer data collection was a largely manual process. In-person or telephone surveys, paper questionnaires, records review, and live focus groups generated data that businesses used to inform decisions about products in development, advertising, and customer service performance.
Internet surveys have replaced many one-on-one and paper surveys and questionnaires, not only for their capability to reach more people, more cost-effectively within a timeframe but also because they randomize and dynamically adapt questions to ensure the most accurate results. However, unless the business is prepared to use it as a part of a larger data collection and analysis strategy, the results of those surveys often cannot be correlated with other data to provide deeper insights.
Integrating AIDC Technology
A growing trend is using AIDC technology to augment traditional consumer data collection methods to learn more about a market, buyer preferences, and the perception consumers have of a retailer or brand.
- QR codes: Businesses are using QR codes in several customer-facing applications. They can be printed on packaging to connect users with the business’ website for additional information, traceability data, and to promote engagement through promotions or gamification. When a user scans the code, the business can capture personal data the user is willing to provide or collect location or time data.
QR codes can also give brick-and-mortar retailers a way to associate in-store customers with their online activity when a shopper scans a code with the store’s app.
- Bluetooth: Bluetooth beacons can collect data on shoppers using their smartphones in a store, showing popular traffic patterns, popular displays, and time spent in different parts of the store. Customers with a store’s app may be specifically identified so the business can correlate their in-store and digital behaviors.
- RFID: Businesses use RFID for inventory management, but this technology can also collect data about customers. Products with RFID tags can show movement throughout a store or enable displays in fitting rooms to show items in other colors or styles or provide information on apparel. With customer opt-in, the system can associate their activities with their account.
- GPS: Geofencing uses GPS to create a boundary that triggers an action if a person moves in or out of it. To learn more about consumers, for example, businesses can have the system send a simple survey question when a person leaves a store.
Best Practices for Gaining Deeper Insights
Using these technologies can give businesses the tools to identify and capitalize on trends and assess and improve performance. It is, however, necessary to use them responsibly. Although a business could potentially track customers’ movements and their shopping behaviors without their knowledge, it can come across as underhanded — and it may be illegal.
Consumer protection laws, such as the California Consumer Privacy Act, give consumers the right to know what a company collects about them and not to have their data shared with third parties.
The best way to proceed is to be upfront about the data you collect and to get permission to collect and use data associated with specific consumers. Of course, comply with all data security requirements that CCPA or other regulations require.
It’s also essential to take a step back before investing in the technology and time to collect any data. Identify which information is relevant to company goals, how to collect it, integrations that break down data silos and how to enable the business to have the insight it needs.
In short, ask the question and find the best solutions for getting the answers.