Forrester: Few brands can anticipate and act on consumer needs

Dive Brief:

The pandemic showed that brands that respond quickly to their customers' needs have the upper hand. However, recent data showed that only a few brands can respond effectively, according to Forrester's report emailed to Retail Dive titled "Anticipatory Experiences: The Challenges."
Forrester's report shows 58% of respondents that anticipate consumer needs have holistic profiles of their customers, 42% have assembled their data to make simple customer profiles and 79% gather all data needed to target customer experiences.
Data from the report indicate that firms that have too many silos and groups within the company and don't use automation have separate versions of events and profiles.

Dive Insight:

In a time when businesses are constantly having to adjust to the needs of their customers, the brands that have the resources to justify decisions and costs can gain a competitive advantage against competitors.

While it may be one thing to recognize the need to predict trends before they happen, figuring out how to collect data on a large scale and knowing how to respond is a different set of challenges in and of itself.

Too many businesses still rely on manual data collection and very few firms automatically update existing data, the report found. Only 33% of the respondents that anticipated customer needs and only 9% of those that didn't said they updated all the data in their custom profiles in real time automatically.

Collecting data in a way that doesn't make consumers wary of giving away their personal information are among the challenges that brands face. Attempting to collect data at a hasty pace will make consumers wary, which means brands must pursue a paced approach to build trust with their customers, the report indicates.

However, some things can be out of companies' control.

Some consumers tend to trust big-box retailers (40%) with their personal data more than e-retailers (36%) and local small businesses (22%), according to a November report from Generali Global Assistance. About two-thirds of shoppers said they were worried about possible data breaches during the holiday season, the report said.

"Solution providers offer answers to portions of the larger puzzle, but no one has all the answers or technology," Forrester wrote. "Achieving this vision will take time. Businesses need to build or buy technology and data — it may take years to obtain the zero- and first-party data they need — as well as gain customer acceptance."