Commentary

OPINION Retailers should embrace geocoding to gain the edge in a challenging environment

Barley Laing, UK managing director at Melissa, discusses how retailers can improve address accuracy and enhance customer experience through geocoding.

As I write this article, the Covid-19 outbreak is ravaging the retail sector. It might be a long time until things get back to a semblance of what they were, but once the virus begins to abate in the coming months and the restrictions start to ease, it’s important for retailers to be fighting fit. This means operating as cost effectively as possible, providing standout customer service, and maximising marketing and sales efforts.

The good news is that geocoding plays a significant role in supporting retailers in all of these areas.

What is geocoding?

In simple terms, geocoding takes a verified postal address and enriches it by appending rooftop latitude and longitude location coordinates. With geocoding, retailers can obtain precise, plotted coordinates to improve logistics and decrease shipping costs, while reducing the chance of the dreaded and costly—both in monetary and customer experience terms—‘return to sender’ scenarios.

Geocoding is particularly important in logistics because location and address aren’t necessarily the same thing. Different locations may share an address such as a plot of land or the street edge of a driveway, for example. This makes a specific latitude and longitude location most accurate, and makes it possible to accurately determine the shopper’s distance from distribution points which generates real-time calculation of shipping costs. The quickest distribution route to the customer can also easily be identified. This information, in turn, enables retailers to offer a number of delivery options and price levels depending on how fast the customer wants to receive the item.

Generate foot traffic

Geocoding can power retail store location and local search lookups. This can help drive footfall and improve the shopping experience, increasing customer satisfaction. Customer experience can be enhanced with geolocational offers targeting audiences based on their location, and the nearest outlet or distribution point to them.

Also, for certain types of products, such as technology, furniture and jewellery, customers might want to see and touch the product before ordering. Being able to do this at the most convenient outlet can be driven via locational intelligence garnered by geocoding.

Analysis for better sales and marketing

Further good news for retailers is that geocoding goes wider than logistics and can aid broader sales and marketing efforts, such as via sales clustering, through the analytics opportunities it provides. With geocoding, it’s possible to map the location of customers and find like-minded prospects in specific geographic areas. They can then be targeted based on similar sites where there has been identifiable interest in your product or service. This insight can also be used to plot customer clusters, facilitating decision making around distribution and customer support locations.

Start with clean data

A very important point to note is that for geocoding to work effectively, retailers must have the correct customer address data in the first instance. Clean data can be delivered via industry leading data cleansing, standardisation and verification services that provide data quality in batch, as well as data entry verification, such as an address autocomplete service, in real-time. This type of service is crucial since many consumers are filling in contact forms on their mobiles, and therefore more liable to make mistakes. In fact, approximately 20 per cent of addresses entered online contain errors including spelling mistakes, wrong house numbers, and inaccurate postcodes, which not only impacts the geocoding process but delays deliveries of products and can lead to ‘return to sender’ packages.

All of this has a negative impact on the customer experience. An address autocomplete service will prevent this while also reducing the number of keystrokes required—by up to 70 per cent— when typing an address, accelerating the checkout process and lowering shopping cart abandonment. It’s also worth noting that in many instances a good geocoding tool will fix spelling errors and autocomplete addresses that have missing or invalid components to provide more precise results.

Make time for geocoding

While many retailers are struggling to see the positives right now, they should use the additional time they may have away from the distractions of the office to look at the bigger picture and think about what they can do to come back even stronger. Geocoding is something they should seriously consider because of the many benefits it offers, from improving logistics and delivery for standout customer service to analytics for improved sales and marketing performance.