Retailers are utilizing customer data-or “insight”-to improve marketing programs and merchandise offering, to tailor product and shopping experience to a customer, a trend known as “customer centricity,” the National Retail Federation (NRF) said in a report.

Customer insight is a fundamental goal of retailers' customer relationship management (CRM) programs, and the Customer Centricity Study-conducted by Ogden Associates for the NRF-also showed 65% of retailers who responded said their technology expenditures for CRM will increase this year.

The study found overwhelming support among retailers for strategies that improve customer experiences, with nearly 98% responding that improving customer experiences was “important,” while another 97% cited that increasing customer satisfaction was “a priority.”

The survey also found that retailers are deploying a wide variety of techniques to build customer understanding, including market and customer research, focus groups, store intercepts, supplier input, Web statistics, third-party data and Internet research.

Of those who responded, 35% of retailers said they obtained direct customer feedback on a daily basis-an increase from 2004, when less than 10% of retailers obtained weekly customer feedback.

An increase also occurred in retailers who said they used customer information for merchandise planning, 67% this year compared to 42% in 2004. NRF also reported retailers see customer insight as important in developing marketing strategies (92%), advertising budgets (69%), catalog targeting (67%), promotions (83%) and customer service (78%).

The study was based on a detailed survey of retailers that was conducted in December 2005. Results of the study were released at the Retail Advertising and Marketing Association's Retail Advertising Conference last month.

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