Retail’s Partnership Revival: Leveraging Unified Customer Data to Increase Revenue


Recent partnerships between large big-box retailers and brands in struggling categories showcase the advantages of seamless experiences that are truly customer-centric, particularly when they are fueled by customer data.

Beauty product retailers Ulta and Sephora recently partnered with Target and Kohl’s, respectively. The deals give the smaller brands the obvious benefit of exposing their products to a larger audience. For the big box retailers, advantages include the opportunity to enhance the online experience (virtual try-ons, personalized recommendations, etc.) and to drive a buy online, pick-up in-store (BOPIS) or curbside experience, which often lead to additional purchases with relevant offers for complementary items.

Success of the partnerships will likely depend on a single customer view that is updated in real time, one that provides a deeper understanding of customer preferences and intent. A seamless and personalized customer journey rests on this data, to deliver an experience with high relevancy and value. Consider a customer who shops at an Ulta display inside of a Target retail location. If that customer’s journey then continues online, a positive experience will depend on the brand knowing everything there is to know about the recent store visit – what products did the customer try on? Did she make a purchase? What colors and styles did she like?

With instant access to real-time updates, the brand will be able to create a hyper-personalized website experience, including personalized recommendations and offers. The opposite is also true; when an online shopper makes an in-store visit, the brand can pick up where the customer left off – enhancing the omnichannel experience.

Because Target, Kohl’s and other big box retailers have the resources to create an accessible BOPIS experience, niche brands can piggyback off this success. Small retailers – especially at mall locations – usually lack the resources and/or customer data to create a seamless in-store or curbside pickup service. Intricate logistics include sending timely SMS or email reminders, ensuring online and in-store inventory are in synch for a given location, and offering preferred pickup times. Done well, a BOPIS experience could also include sending an SMS offer for a complementary item once the customer arranges for pickup. All of this requires real-time customer data to ensure a consistent experience between the online purchase and in-store pickup.

One of the retail lessons from 2020 is the rapid acceleration of a digital-first mindset and the need to deliver a personalized customer experience. According to recent McKinsey research, 73% of U.S. shoppers said that they’ve tried a new shopping behavior this year, such as curbside pickup. And 80% said they will continue the behavior in the future. Further, in a Redpoint survey conducted by Dynata, 70% of consumers said that they will shop this holiday season with brands that personally understand them.

Ulta, Sephora and other forward-looking brands understand that partnerships with large retailers do more than expose the brand to a larger audience; they put the smaller retailers on equal footing in terms of collecting and using customer data to create innovative experiences that drive revenue.

-John Nash, Chief Strategy Office, Redpoint Global