GDPR: What does it mean for the future of retail?

For many retailers, getting to grips with the best methods of utilising customer data was no easy feat. Brands worked hard to unlock the potential of data to enhance the customer experience making it more unique and personalised. It appeared that many had cracked it too. From adapting their marketing content according to customers’ needs, to providing rewards based on their buying habits, data use had become extremely efficient. However, regular data breaches and hacking scandals may have put paid to these methods. The impending introduction of the General Data Protection Act (GDPR) on 25th May 2018 is likely to leave many retailers feeling that just as they’ve got their house in order, the rug is pulled from under them. One likely outcome of the introduction of the GDPR is more shoppers choosing to conceal their data from retailers. Brands can no longer assume that consumers are happy to be targeted based on previous data shared. Instead, they will have to convince customers to actively opt-in again to enable data access, explaining why they are seeking specific information and outlining how they plan to use it. While many companies may be underprepared for these changes, and may fear the depletion of the all-important shopper database, it’s not all bad news. The opportunity to build trust and brand affinity is one that should not be underestimated. GDPR puts the control firmly back in the hands of consumers, who will expect more personalised benefits in return for sharing their data – this in turn can lead to a more profound relationship between brand and consumer. In fact, a study by Awesomeness showed that 59% of Gen Z wanted brands to use their personal information to give them better product recommendations. A brand that develops the right proposition for shoppers – delivering innovation and enhanced customer experience while also guaranteeing protection of their personal information – can only strengthen their customer relationships. Conversely, failure to reassure consumers that their data is safe will see retailers shunned. The key to overcoming the potential issues that come with the GDPR is in highlighting the value that data sharing can provide. Debenhams in Stevenage, Hertfordshire, has trialled a system that sees customer shopping habits used to tailor the in-store product range based on online demand within the catchment area – a solid example of a retailer digging into data to reduce wastage and drive sales. M&S has used smart data to create its Try Tuesday personal shopper website. Shoppers share their preferences and team of “online stylists” pick the outfits based on these choices, before redirecting to the M&S retail site. This showcases the high level of personalised service available to customers that consent to sharing their data, but also how it can build a direct route to sales. AI, too, could be an area for retailers to utilise customer data with an emphasis on providing an omnichannel experience that delivers a seamless transition from online to offline spheres. The increased use of customer-facing chatbots is a good example of this. Their improved level of responsiveness means that customers who choose to share their data are likely to receive a more tailored service. Customers can have questions answered simply, have products recommended based on their previous purchases and receive insights that will encourage them to transfer their journey in-store and experience the same level of attentive customer service. Ultimately, retailers have a genuine opportunity to demonstrate to shoppers that the more data they are willing to share, the better their shopping experience will be – and regaining and maintaining consumer trust will be pivotal to minimising the perceived risk of the GDPR. Valentina Candeloro is the marketing director of Mood Media. The group offers experiential design and marketing solutions, helping brands connect with their customers by providing music, digital signage, scent, integrated audio visual, and interactive mobile marketing solutions that help to improve customer experience.