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CRMC 2013 "Power to the People"


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dunnhumby presentation at the 2013 CRMC conference in Chicago, IL.

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CRMC 2013 "Power to the People"

  1. 1. © dunnhumby 2013 | confidentialPower to the PeopleA New Model forCustomer-First CRMJune, 2013
  2. 2. © dunnhumby 2013 | confidential● Driving forces behind Raley’s● Raley’s no longer a conventional grocery chain● Raley’s has a loyalty approach, not just a cardprogram● Rules that build customer engagement● Innovations in advocacy● Customer data driving the business2
  3. 3. © dunnhumby 2013 | confidentialRules changing at an aggressive pace● Customers’ and their needs● Buying decisions● Retail options3
  4. 4. © dunnhumby 2013 | confidential4The competitive landscape is changing rapidly– especially in CaliforniaNew threats fromold competitors inexistingchannels…New threats from newcompetitors in newchannels…Suppliers sellingdirect toconsumers…Competitors leveragingnew models…Growth of clubs…Saturation of grocery…LOW ENDHIGH END
  5. 5. © dunnhumby 2013 | confidential“Raleys makes our customers lives easier andbetter by delivering a personalized foodshopping experience.”Mission Statement“We build lasting relationships with our customers byanticipating their needs and exceeding theirexpectations.”Our Core Values
  6. 6. © dunnhumby 2013 | confidentialTraditional product centricCustomers treated thesameMass marketingOne size fits allRisk averseWe can do it ourselvesCustomer centricManaging change &engaging the organizationNew talent to deliverTechnologyStrategic partnersFrom ToRaley’s transformation is centered aroundpersonalizing the customer experience
  7. 7. © dunnhumby 2013 | confidential7Transactional/functionalEmotionalengagementDid I getwhat I want?How did thatmake mefeel?How do I feelabout thisretailer?Taking meaningful steps to emotionally engage ourcustomers
  8. 8. © dunnhumby 2013 | confidentialThe Raley’s and dunnhumby partnership was initiatedthrough common beliefs8Best-in-ClassProven ResultsA-Team on siteGlobal LearningCultureFlexibilitySpeedTest & LearnValues AlignmentOutrageous ThinkingFuture thinkingInnovationPassionVision
  9. 9. © dunnhumby 2013 | confidentialRaley’s wanted to reward and retain our bestcustomers but knew a loyalty program alone wasn’tthe answer9
  10. 10. © dunnhumby 2013 | confidentialA loyalty card is the business enabler for insight,improved customer and employee engagement10
  11. 11. © dunnhumby 2013 | confidential11directcommunicationmore effectivemass mediacustomer-baseddecision toolstest & Learnsmarterpricingrewards(loyaltyprogram)customer-ledassortmentmore efficientpromotionsstaffmotivationchange waysof workinggetting thestore / brandrightgettingcomms rightgetting the rightprocesses rightorganic growthbase salesdirectcommunicationmore effectivemass mediacustomer-baseddecision toolstest & Learnsmarterpricingrewards(loyaltyprogram)customer-ledassortmentmore efficientpromotionsstaffmotivationchange waysof workinggetting thestore / brandrightgettingcomms rightgetting the rightprocesses rightorganic growthbase salesA ‘loyalty approach’ creates the breakthrough valueretailers are looking for
  12. 12. © dunnhumby 2013 | confidential…rewards you for being you.Launched Aug 2012700,000 active customersPoints based programDigital bias with paper variationsLoad to card
  13. 13. © dunnhumby 2013 | confidentialSomething Extra provides members with five overtkey benefits● Personalized Offers● Extra Points● Rewards● Inspired Ideas● Extra Surprises13
  14. 14. © dunnhumby 2013 | confidentialOur approach combines loyalty and advocacy todeliver on our promise to give customers ‘SomethingExtra’14Increase LOYALTY ofRaley’s Best CustomersCultivate ADVOCACY forRaley’s and our Suppliersboth online and offline
  15. 15. © dunnhumby 2013 | confidentialExecuting a predominately digital program means wehave to be relevant to cut through the clutter15We are all bombarded by…1. Other grocers!2. National retailers3. Specialty retailers4. Local retailers5. Travel sites6. Service providers7. Financial services8. Entertainment9. Magazines10. News articles11. Google alerts12. Bill collectors13. Social media sites14. Personal emails15. etc…16. etc…
  16. 16. © dunnhumby 2013 | confidentialThe key to cutting through the clutter is consistentquality, not quantityThe key to quality is RELEVANCE16We ARE incentivizing our customers toshop with us every tripRewardsExtra Points
  17. 17. © dunnhumby 2013 | confidentialEmail provides a base communication to reach ourmost engaged customers● Initial emails designed to:– on-board shopper into the program– experience the benefits quickly● Shoppers receive a consistent flow ofoffers based on their visit pattern● Limited number of offers to increaserelevancy● Offers based on items customers arebuying already● Takes customers to whereadditional offers & information can befound
  18. 18. © dunnhumby 2013 | confidentialThe Quarterly Rewards Statement is the flagship ofSomething Extra● 1% reward for every customercollecting 500 or more in aquarter● 95% of coupon combinationsare unique● Limited number of offers toincrease relevancy● Offers based on itemscustomers are buying already● Paper and digital versionsbased on preference
  19. 19. © dunnhumby 2013 | confidential19Success is coming by doing the hard work to make iteasier for the customer● >60% sales on Something Extra● 75% of all members participated in the Rewards Statement or Email● Open rates up to 65%● Up to $7 Sales to Cost● Average 32% coupon redemption● Over 1200 coupons available● 500 attendees at vendor summits● Reporting available to all participating vendors
  20. 20. © dunnhumby 2013 | confidential“What I love are the coupons for itemsthat are usually on every shopping list,like coffee and yogurt. My brands andmy packs. Raley’s is paying attention tome.”Myrle Pardedd
  21. 21. © dunnhumby 2013 | confidential“Wow! I just received my first “ExtraRewards.” Six coupons, all of which I canuse plus a $5.00 credit. I am impressed!”Richard Charles Paul
  22. 22. © dunnhumby 2013 | confidentialSomething ExtraTry-It is theplatform whichallows us tocultivate advocacyat Raley’s
  23. 23. © dunnhumby 2013 | confidentialThere are four basic steps to every Try-it program2323MEASUREAdvocacy impact acrosskey metricsENGAGEExclusive Raley’sExperiencesTARGETLoyal shoppers invited toparticipate based onshopper data, profilesurveys & influenceACTIVATEParticipants spread WOMand share digital content
  24. 24. © dunnhumby 2013 | confidential60% of sales come from our loyal customers (20%),yet we are just capturing 60% of their share of wallet24
  25. 25. © dunnhumby 2013 | confidentialAddressing price perception where it matters most25● Recognition that all customers aresensitive to price● Tailor the store to reflect itscustomers● Which customers respond tostimuli● Tactics to drive sales whereopportunities exist
  26. 26. © dunnhumby 2013 | confidentialDriving efficiency in promotions● Stop negative-lift promotions● Actions to improve revenue– Adjust discount depth– Try different promotion type– Stop promoting– Shift to 1:1 targeted communications26
  27. 27. © dunnhumby 2013 | confidentialImprove assortment decisions and get insights onmerchants’ desktops● Product assortment optimization– Protecting SKUs loyal customers buy andremoving inefficient ones● Differentiated store assortmentbased on customer needs● Space planning– Layout and adjacencies– Navigation
  28. 28. © dunnhumby 2012 | confidentialImproved collaboration with vendors with a collectivefocus on the shopper28dunnhumbyManufacturerRaley’s Improved Sales ImprovedCommunication ImprovedRelationships SimplifiedCollaboration
  29. 29. © dunnhumby 2013 | confidential29So, do you have a LoyaltyProgram or Loyalty Approach?