From Customer Loyalty to Advocacy

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dunnhumby & BzzAgent presentation at the 2012 ARF Audience Measurement 7.0 Conference

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From Customer Loyalty to Advocacy

  1. 1. From CustomerLoyalty to SocialAdvocacy Photo Photo *1-pt black border *1-pt black border shadow shadowMalcolm Faulds Matthew KeylockSVP Marketing SVP, New BusinessBzzAgent, a dunnhumby company Development & Partnerships dunnhumbyUSA
  2. 2. Joint Research Initiative Analysis on the SHOPPER intersection of social ADVOCACY and shopper behaviors LOYALTY to improve advocacy SOCIAL
  3. 3. Joint Research Initiative Advocacy matters Target advocates through shopper and social behavioral data Grows loyal customers and a substantial sales lift Greater impact than targeting with demographic or social influence targeting alone
  4. 4. BackgroundMarketers Collect Rich Data on Customer Behaviors Extensive data is collected on all purchase activities Enables customized communications and more relevant offers Must know how to use data to improve performance
  5. 5. ProblemCustomer Insights are Underused in Social Media For many marketers, online customers are anonymous Loyal customers aren’t prioritized Organic social media activity isn’t connected to in-store purchases Social marketing isn’t typically evaluated by sales impact
  6. 6. Problem“Likes” are Not a Business Success Metric Facebook “Likes” and engagement are not financial metrics Marketers need to focus on advocacy Target by combining – Demographics – Social influence – Purchase behavior
  7. 7. OpportunityAdvocacy is Important in Marketing More trust recommendations and Advocates visit more, buy more items, and spend more overall online reviews than editorial coverage and brand messages (Nielsen) Leading retailer estimates advocacy is a $5.3 Billion opportunity Advocates are: – self-directed consumers – have large social circles – influence purchases of many others Index to All Customers for National Retail Chain
  8. 8. MethodDefine Your Best Customers Correctly Most companies do it wrong Incorrect Correct Emphasizing profitability is a Customer Shopping frequency narrow-minded view profitability Spending per year Get this right. Use the wrong lens and you won’t be able to Buying across leverage this insight categories
  9. 9. MethodIdentify Your Best Customers in Social Media Loyalty card data from national retailers with SHOPPER BEHAVIORS advocate community BUYING SHOPPER PATTERNS CLUSTERS IDEAL BRAND ADVOCATES DEMOGRAPHICS/ PSYCHOGRAPHICS SOCIAL BEHAVIORS AGE HOBBIES GENDER LOCATION
  10. 10. AnalysisPrior Brand Behavior Drives Increased Advocacy Level of Advocacy ActivitiesConsumers with Advocate Behavior Indexheavy/mediumadvocacy activityIndexed to theoverall buyer profile Types of Shoppers
  11. 11. AnalysisBest Targeted Advocates Make More RepeatPurchases Repeat Purchases by Targeting Segment Purchase behavior groups make twice as many post campaign repeat sales as demographic targeted groups
  12. 12. ConclusionStrong Sales Lift at the Market Level Measured sales lift across the Average Campaign geographic market averaged 8% Sales Lift Determined by 2-cell Match Market Tests conducted by dunnhumby 8%
  13. 13. ConclusionSales Sustain Months Later 10% 6 months after the campaign, 50% of the sales lift sustained (avg lift 4%) 8% People kept buying after push from Sales List 6% 50% of Lift company ends - unlike any other media Maintained 4% Social got them in the door, and they stuck with the brand 2% 0% Campaign 6 Mos Later
  14. 14. SummaryPower of the Informed Introduction A group of the right people can drive a sustained lift in sales A few customers identified by their Test Market Control Market purchase data can influence an entire 8% Sales Lift market 4% After 6 Mos.
  15. 15. Summary3 Key Drivers of Higher ROI in Advocacy Marketing1. Target participants based on Purchase behavioral data Behavior2. Products with higher baseline sales3. Products with higher product Higher Baseline Priced price points Product Sales
  16. 16. What’s Next Expand dataset and establish category benchmarks Correlate additional shopper attributes with advocacy Study integration with in-store promotions and other media Understand broader influence of social on shopper behaviors
  17. 17. Thank You Please leave your card for more information on this study Feel free to contact us with any additional questions Malcolm Faulds Matthew Keylock mfaulds@bzzagent.com matthew.keylock@us.dunnhumby.com @mfaulds @mattkeylock

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