Tuesday, March 27, 2007

Gaining Insight The Prada Way

The segment Prada seems to be targeting is the upper-class female who likes to be on the forefront of fashion and has plenty of disposable income. In terms of this particular segment, I think Prada’s use of technology is appropriate. Because these women are considerably wealthy, they usually are used to getting spectacular customer service. And Prada definitely delivers it. In the article, “Prada Gets Personal,” it is noted that Prada spent $20 million on technology, installing video cameras and “Staff Devices” to further personalize each customer’s shopping experience. These new technological devices allow their segment to find exactly what they have in mind, without even having their favorite sales associates leave their side. In addition, Prada has surpassed traditional use of RFID tags to install them onto virtually every item in the store according to the “Prada Case Study” article. Unlike Walmart’s use of RFIDs mostly for inventory purposes, Prada uses them predominantly to build relationships and gain customer loyalty. For example, the RFIDs installed inside their “magic dressing room mirrors” allow women to see themselves twirling with chosen clothes on and enables them to save all the items they brought in into a “digital closet” that can be viewed online at a later time. For women who are a part of the elite society, this type of new innovation establishes an instant connection because it makes them feel special and understood. The Prada stores seem to know everything about their segment just by scanning a simple customer card.

I think that Prada’s use of technology can be useful for other companies and retailers as well. Regardless of what company it is, the main goal (besides earning profit) is to enhance customer experience. And sometimes that can only be done through the use of technology, since humans may not have the necessary means to perform certain functions. Other retailers do not have to be as extravagant as Prada, but they can definitely learn something. The underlying concept is to make the customer feel like you understand them- their needs, preferences, and even their motives for buying certain products. With the advanced RFIDs, sales associates are in sense able to gain greater understanding into each of their customers, personalizing their browsing and purchasing behavior step-by-step. Using similar technology will also allow customers to save time. Real-time inventory capabilities may allow customers know exactly what is in stock currently, what items are offered in different store locations, and what may be in stock a week later. This makes shopping so much easier and convenient. In a world where consumers demand instant and top-notch service, other companies should definitely consider following in Prada’s tracks.

Overall I think Prada is doing a wonderful job at using technology, in terms of really personalizing the customer shopping experience. They are clearly stirring creative juices in the technology sector! The concept of being able to scan an item and learn more about it is such a simple concept, but Prada has taken that idea to the next level. I really think they will benefit from increased customer loyalty and image branding in the market. Customers want to feel unique, and Prada delivers exactly that service. Many times, it is not about the actual product they purchase, but the way they feel when shopping. Customer experience is more than just going into a store and purchasing an item; it encompasses all the sights, sounds, and emotions attached with the experience as well.

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