The astute around us have grown more vocal in calling attention to all the ways merchants are losing control over their customers. We likened the trend to the relationship between hotels and OTAs in an article in January. Yet no matter how much we care to write, the truth still fails to sink into brick and mortar merchants.
We thought to enumerate some of the ways merchants have been losing control over their customers as the industry has moved along over the past five years.
- Google knows your wait times better than you. Using quasi-anonymous location data from Android mobile devices (or any device with a Google app installed), Google is able to understand dwell times and total traffic to your business. Google has gotten so granular with this information that they’re even able to recommend when a user should make a reservation (and they have a service for that, too). This means Google could build a better labor and inventory forecasting model than 99% of merchants. That’s sad.
- Google and the credit card networks know your customers better than you. They know where else your customers are shopping, when they’re shopping, and how much they’re spending. This data becomes critical in helping to design marketing programs that target your customers by their interests. Google has even gone so far as to recommend new businesses for you to try. These networks are intercepting your customers before your marketing has a chance to reach them. Mastercard Advisors is a billion-dollar entity within Mastercard that has found creative ways to put this data to work. But most merchants would never even consider using data to improve their business. Because who needs data, right? Point: data companies.
- The proliferation of 3rd party ordering and delivery services mean that customer data is stopping short of your four walls. These companies are becoming the face of your business across new channels of commerce. Consumers don’t want to download your app. Customers don’t want to settle for only one option either. Aggregation wins out and the Grubhubs of the world are building and supporting consumer-facing apps better than you. These providers keep your customer data and remarket to them as needed. The result? All those customers that you pushed to your 3rd party “partners” are customers you just lost.
Why does this keep happening? Because merchants are not business people. They have a hobby that they’re hoping to turn into a viable enterprise with none of the acumen to really get there. This is why POS personnel are critical to a merchant’s survival: a good POS system will monitor these data sets and help a merchant compete, usually with a combination of automation and advisory services to fix problems before they become catastrophes.
Or you can buy a POS that doesn’t do anything more than a cash register. Your choice.
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