Gaining deeper customer insight is the key to gaining a competitive edge in the retail

Loyalty cards give retailers a better guide to customer preferences study finds."Customer loyalty is based on the extent to which merchants connect with
customers' interests, values and needs," said Nigel Holloway, research director
in the Americas for the Economist Intelligence Unit- according to Understanding
the customer, the first of three parts of a new Economist Intelligence Unit
report entitled Intelligent Merchandising: Creating a Unique Shopping
Experience. The report is based on a worldwide online survey of 180 senior
retail executives conducted by the Economist Intelligence Unit for SAP. The
executives were also interviewed for more in-depth responses and analyses.

Other key findings of the report include the following:

* Retailers opt mostly for traditional methods to keep customers loyal. Over
half of the executives use new products (63%), local store activities (56%) and
discounts for special customers (52%) to enhance customer loyalty.

* Customer satisfaction and retention are key measures of the success of
promotional efforts. The success of promotions is tracked through customer
satisfaction (55%), customer retention (52%) and sales per square meter of
retail space per week (40%).

* Executives rely heavily on sales staff to monitor the "customer experience."
The lowest-paid member in the retail industry is considered the most reliable
observer of customer behaviour. In-store traffic (31%) and customer opinions
(31%) are seen as important indicators of customer satisfaction.