June 13, 2010, 12:29 PM

Get to know your customer, or a competitor will

By better understanding shoppers, retailers can create loyalty and increase sales.

Major brands like Blockbuster, Yahoo and Barnes & Noble, once leaders in business-to-consumer technology, have taken hits in the past decade from new Internet-based brands like Redbox, Netflix, Google and Amazon.com, David Blakelock, vice president of technology for web and catalog retailer Boston Apparel Group, said at the Internet Retailer Conference & Exhibition last week in Chicago.

The reason that newcomers have overtaken such established brands, he said, is because the incumbents failed to understand what their customers were looking for.

Web retailers need to learn the same lesson, or fall behind new players more in tune with consumers, he said.

“As Internet retailers we’ve been the ones attacking big brands,” he said. “But what do you do about the guys in garages just starting up and coming up with the next big idea?”

Retailers need to home in on who their customers are and what they’re seeking, he said. “You need to know what interests your customer.”

For instance, Blakelock recently received an e-mail from a favorite dress shirt retailer. The e-mail’s subject line read, “Special promotion just for you.”  “I thought ‘Finally, someone gets it,’” he said. But when he clicked on the e-mail it led to a sale of suits. And Blakelock doesn’t wear suits. “Now I don’t open their messages,” he said.

To listen more effectively to customers, Blakelock urged retailers to organize in a central location the data they already collect—from product reviews to purchases to customer complaints. Then they can segment their customers and send them targeted messages.

“The only way you can break through consumers’ cluttered inboxes is by creating something relevant to the customer,” he said.

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