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An advanced order management system is also important to build an endless aisle experience at stores. An integrated platform is needed to manage stores and online checkouts. Many apparel brands have this system at present.
To orchestrate a personalized journey, organizations need marketing technology software that captures consumer data. To get the best results, this should be embedded with product recommendation engines. A scalable and modular architecture is critical to add/modify components as the scale of operations and complexity grows without disrupting daily business. Retailers should also build the right API structures and create a unified data layer.
Building a profitable DTC model, however, also requires a critical review of the unit economics of the business. A strong consumer lifetime value is important to build the margin pool. While there should be disintermediation of channels as needed, there is also a need to strike a balance to ensure appropriate proximity to consumer location. Retailers should build hooks and content for consumers to keep returning to the brand.
Customer first-party data
Traditionally, companies would curate personalized experiences through third-party data. However, that is changing. With privacy concerns and major browsers blocking third-party cookies, retailers will, in the near future, not be able to collect and harness third-party data.
Broadly, there are three types of customer data in play.
First-party data: This is the data captured by a brand/retailer directly from the consumer with explicit consent via channels they own or can influence. For example, websites, apps, surveys, CRM, feedback, offline activations.
Second-party data: First-party data of other platforms, or walled gardens, which the brand/retailer is directly working with. For example, data from platforms like Facebook and Google.
Third-party data: This is data that is owned by various apps in content, publishing, social network, etc., where the brand/retail is not directly working with but leveraging ad networks and intermediaries, such as Google.