Numbers can be deceiving. In this complex and ever-changing industry, it’s difficult to find a meaningful method to measure how successful your strategies are. Are you getting enough customers? Are they having a good experience? What’s their favorite channel? The common mistake most marketers make is focusing simply on conversions, impressions, revenue. And, honestly, can we blame them? These days, consumers are exposed to somewhere between 4,000 to 10,000 ads per day while fewer than 1 in every 2,000 of those actually get clicked, and customers are getting more and more demanding, with 90% demanding consistent content and interaction across all different channels. It’s never been this difficult to cut through the noise and actually connect with consumers while still achieving efficient results for your business. 

These days, the customer journey is more complex than ever, crossing different channels, each playing their own role. As such, it can be easy to rely on the last click, still one of the most popular attribution models within digital marketing, which focuses simply on… well, on that one click that drove a conversion, ignoring every action that came before. By focusing on just this final step, the results can seem simple.

But they’re also misleading.

Why programmatic and last click aren’t a match

When working with your programmatic media partner to define the best strategy, last click is never the way to go. Why? The result of last click optimized display media is a cannibalization of other digital media channels. If you launch a display campaign optimized on last click, the high conversions you’ll get in the display channel will come at the cost of the others. What does this mean? It means your display media focused on last click is not prompting incremental conversions, but instead is only creating a more convenient way back to a site for a customer who has already decided to purchase. If my mind is set on buying a pair of sneakers, for example, I might just click a display ad to get to the website – by just attributing that last click, you’re ignoring where in the journey I was influenced to make the purchase.

So how do you ensure your media executions are delivering true incremental value in a multichannel marketing landscape? There are a variety of complex multi-touch attribution models that can be applied to your marketing initiatives to help you understand the real value your media is driving. However, regardless of the complexity of these models, attribution should not be confused with incrementality. Understanding which conversions are incremental and can be attributed to your media executions is difficult. A good programmatic agency/provider should make the complex simple and support rigorous test and learn studies to help you understand the real value of your programmatic media executions.

We recently supported two large international brands in France and Germany on head to head tests against a large retargeting competitor. Each had their own attribution methodology, heavily skewed towards last click, but were open to measuring the incremental value that each side of the test delivered. And the results were as unequivocal as they were consistent: the competitor had higher last click results but when you compared the progression in spend of each side of the cookie pool, the results changed completely. Our pool clearly had increased their spend in comparison with the other half of the cookie split. Being able to demonstrate the value of our approach led to further marketing investment in this channel from the brands involved.

So, can we estimate how much actual value programmatic media delivers? The answer is yes, and we recently helped a large travel client in Germany to do just that. The client held back a small portion of their customers from programmatic media, while continuing to expose all their other media channels to these customers. That enabled them to isolate the impact of our retargeting executions by comparing the spend between the groups who did and did not receive programmatic advertising. And the results again were unequivocal: the exposed customers made 19% more purchases, creating 16% more revenue. On the basis of these results, the brand scaled up their programmatic budgets.

The solution

If last click isn’t the solution for your display campaigns then, what is? The simple answer is to utilize display media to actually influence customer behaviour throughout the entire customer journey. You can leverage a multi-touch attribution partner or deploy more advanced holdout executions that will allow you to better understand the actual incremental impact display media is having in combination with your other digital channels. Work with your programmatic media partner to ensure your strategy manages to assess the real impact that display media is having on your brand and its customers – and for that, you need to focus on more than just one click.

Display advertising should be used to follow the customer and their journey, reaching out to them in the right channel with the right message. This will facilitate that difficult balance between each channel and their value, making sure they all work together for one unique, valuable customer experience. Last click misses the big picture. A marketer’s approach should address the entire marketing funnel – because, ultimately, that’s the only way to enhance and improve the customer journey. And if your brand is  not there along with them, someone else will be.

Promotions are a key mechanic for every retailer to build surprise and delight into the customer experience, yet there is still huge complexity surrounding effective management of promotions. Many retailers waste too much time struggling to identify which promotional offers actually drive footfall and spend amongst their Customers. With streamlining processes to create efficiencies high on the agenda of many retailers, this month we talked to Krista Gettle, Promotions Product Director for dunnhumby, to learn a little more about how developments in simplifying the promotional planning process is helping retailers save time and money.

With constant pressure for retailers to improve margins and reduce costs through efficiencies, what do you think are the key enablers to help them achieve this?

Time is money in retail. And facing so many competing priorities, retailers need be able to make informed decisions quickly so that marketing strategies and tactics can be executed in a timely fashion. Traditional grocery retail particularly seems to suffer from legacy systems which can be responsible for cumbersome and inefficient processes. With promotion planning for example, to stay nimble and competitive, retailers should be spending less time on the administrative aspects of the process and more on strategic decision making that will support wider growth initiatives for their categories and customers. 

One vital key enabler to help retailers free up resources within their planning teams is having integrated business intelligence systems that serve as the single source of truth on the state of their business. Having relevant, timely data-driven insights at the point of decision making allows them to efficiently manage the complexity of their business. 

What do you see being the biggest challenge that retailers face when optimising promotional strategies?

Retail promotional planning is a manual, time-intensive, error prone and disjointed process. The sheer volume of data points and the interaction between those can present an enormous challenge to overcome when forecasting promotional performance and when measuring the results of your promotional campaigns. Most retailers are simultaneously managing multiple dynamic promotional cycles and this makes measuring the true success of overlapping campaigns a complex undertaking.  Legacy promotional systems and processes often fall short in this area as many of them only drive toward understanding sales performance at a single point in time.  What’s required is systems that can dynamically incorporate new information and help retailers identify inadvertent interactions resulting from independent decisions.

Tell us a little bit about how the Price & Promotions team at dunnhumby helps retailers win.

Price is one of the most important factors influencing where people choose to shop, yet joining the “race to the bottom” by dropping prices across the board is not a viable long-term business strategy for most retailers who are facing increasingly squeezed margins. dunnhumby’s Price & Promotion consulting and tools help retailers improve Customer experience and generate loyalty through enhanced value perception, consistent and logical pricing, and promotions that are meaningful and relevant. As well as improving efficiencies, reducing unproductive promotions and focusing on price investment, our solutions save valuable execution time across the enterprise, and guide investment where it will impact Customers the most, driving margin increases of between 1-3%.

A specific example to highlight would be our Promotion Analytics software. By leveraging insights from this tool, retailers can develop clear promotional guidelines for categories based on past performance that can inform future marketing activities.

What do you think will be the biggest changes in P&P technology / solutions for the next 2 years?

The concept of personalization has been around for a while now, but very few retailers are doing it properly at scale, and few have ventured into the area of personalized pricing. As customer science techniques increase in their sophistication, and retailers gain even greater insight into the needs, wants, behaviors and motivations of their customers, personalized pricing and promotions will be an important weapon in a retailer’s strategic arsenal when it comes to winning and keeping customers. Building solutions that help retailers manage personalization for their most loyal customer segments while also managing CPG expectations of performance will be a strong focus. Customers want to feel you anticipate what they want to buy.  Promotional planning will need to help retailers respond to this demand, forecast accurately and feed into their operational systems seamlessly.

Retail success takes many forms in today’s dynamic marketplace. From large legacy retailers to disruptive start-ups and all manner of competitors in between, the paths to retail success involves common principals around which there is a wide variation of understanding and execution.

To bring clarity to the issue of what makes a winner, dunnhumby, the global customer data science firm, conducted a massive survey of more than 7,000 U.S. shoppers for the second annual Retailer Preference Index (RPI), the first study of its kind in the industry. In what’s quickly become known as retailing’s equivalent of research firm Gartner’s often-cited Magic Quadrant, dunnhumby’s RPI is a ranking of more than 50 large food and consumable retailers based on a combination of shopper sentiment and financial performance.

Join Retail Leader and dunnhumby’s Jose Gomes, President of North America, and Erich Kahner, Associate Director of Strategy, for a deep dive into the RPI, the levers for success, and an unvarnished look at why some retailers win and others don’t.

Topics discussed include:

• The 7 drivers of consumer preference and what’s changed.
• Understanding the RPI methodology.
• How retail winners make emotional connections.
• The new rules of value perception, key drivers and amplifiers.
• The three things RPI laggards must do to improve their appeal to shoppers.

For a look at the retailer rankings and to understand how your business can benefit from implementing the RPI success framework, watch our webinar which took place on Thursday, September 5, 2019.

Groceries can be ordered by voice from refrigerators. And delivered within 1 hour. Scan a mobile app hosted QR code in-store and skip the cashier. The convergence of smart technology and everyday life isn’t on the horizon – it is already here. Today, customers expect experiences and engagement with retailers and brands to meet their wants and needs, and seamlessly fit into their lives.

What should you consider to prepare your customer engagement strategy today to meet the needs of your customers tomorrow (and in 2025)? Join retail veteran, David Ciancio, and Head of dunnhumby Ventures, Kyle Fugere as they share real-world examples and ideas you can begin testing today to ensure your customer engagement road map leads to long-term growth.

Join us Wednesday, October 2 at 2pm EDT.

Register now   

Speakers:

David Ciancio, Global Head of Grocery Retail, dunnhumby
Recognized by Advertising Age as one of the ‘Top 50 Marketers’ (2008), David brings nearly 50 years of retailing experience as an operator, marketer, and strategist. As Global Head of Grocery Retail, he helps dunnhumby clients around the world grow their sales and customer loyalty through customer-led organizational change management and creating better customer experiences.

Beginning in 1996, he created one of the first supermarket loyalty card programs in the U.S. for Kroger, and led their innovative loyalty approach that today engages more than 50 million households. His visionary, customer-led, organic ideas and Customer First leadership approach contributed to Kroger’s remarkable 53 consecutive quarters of positive identical sales growth.

David also serves as a Board Director on several of dunnhumby’s joint venture partnerships.
 
Kyle Fugere, Lead of Strategic Investments, dunnhumby
Kyle leads all strategic investments for dunnhumby's corporate venture capital unit. Having previously founded 2 companies in the B2B technology space, he's an expert on Innovation, Product, and Venture Capital.

An Advisor for Boston Seed Capital, Kyle is also a board Observer for GrocerKey, Pulsate, and Askuity and is a frequent speaker and writer on the subject of retail innovation. Kyle holds an MBA from Babson College, Boston.

  
Jon Springer, Executive Editor, Winsight Grocery Business
Jon Springer is executive editor of Winsight Grocery Business with responsibility for leading its digital news team. Jon has more than 20 years of experience covering consumer business and retail in New York, including more than 14 years at the Retail/Financial desk at Supermarket News.

Was lohnt sich: eine breite Produktpalette oder lieber wenige, ausgewählte Angebote? Diese Frage stellen sich viele Einzelhändler. Tatsächlich gibt es zwei vorherrschende Ansichten zu diesem Problem: Einige vertreten die Sichtweise, dass eine große Produktauswahl notwendig ist, damit alle Kunden genau die Produkte finden, die ihren Bedürfnissen entsprechen. Andere sind der Meinung, dass eine zu große Auswahl die Käufer überfordert. Dies führe somit zu einer negativen Erfahrung und eventuell gar keinem Kauf. Die Herausforderung für Händler: Die Balance zwischen Klasse und Masse zu treffen – durch personalisierte Erlebnisse.

Weniger ist mehr

Das Kernargument gegen eine große Produktvielfalt: Viele Optionen führen zu vielen Informationen, die vom Kunden verarbeitet werden müssen. Dies äußert sich oftmals in Stress und führt wiederrum dazu, dass Kunden die Suche nach dem optimalen Produkt abbrechen und keinen Kauf tätigen. Eine bekannte Studie aus dem Jahr 2000 von den Psychologen Sheena Iyengar und Mark Lepper beschäftige sich genau mit diesem Phänomen. Die Forscher identifizierten eine „Entscheidungs-Lähmung“: Als man Kunden 24 Marmeladensorten anbot, tätigten sie mit einer geringeren Wahrscheinlichkeit einen Kauf, als Kunden, die lediglich sechs Sorten angeboten bekamen.

Existieren zu viele Optionen, sind Kunden mit ihren Kaufentscheidungen nicht völlig zufrieden, oftmals muss ein Kompromiss bei Produkteigenschaften eingegangen werden. Die „Reue des Käufers“ kann als ein negativer Aspekt von zu großer Auswahl angeführt werden. Hierbei handelt es sich um eine kognitive Verzerrung. Müssen Kunden beispielsweise zwischen Preis und Komfort abwägen, kaufen sie ein Produkt, dass sie nicht komplett zufriedenstellt.

Große Auswahl führt zu Experimenten und Individualisierung

Vertreter der konträren Position gehen davon aus, dass alle Kunden unterschiedlich sind und daher von einer großen Produktauswahl profitieren. Das Credo lautet: es gibt kein Produkt, dass alle Kunden zufriedenstellt. Jeder Kunde braucht eine andere Kombination von Eigenschaften, jeder bringt andere Bedürfnisse mit in die Einkaufssituation. Verdeutlichen kann man dies an einem ganz trivialen Beispiel: dem Zahnpasta-Kauf. Ein Kunde hat empfindliches Zahnfleisch, ein anderer will frischen Atem; der dritte möchte weißere Zähne. Manche brauchen eine kleine Tube, andere benötigen eine Familienpackung. Hier bietet eine große Auswahl nur Vorteile, da sie es allen ermöglicht, das perfekte Produkt zu finden, das auch ihrem Budget entspricht.

Eine große Auswahl bringt außerdem einen positiven Nebeneffekt: Durch Experimente mit unbekannten Produkten finden Kunden neue Artikel, die ihnen zusagen. Ohne dieses Ausprobieren findet kein Umschwenken der Kaufgewohnheiten statt. Eine aktuelle Studie zeigt, dass Verbraucher neue Produkte im Rahmen einer Phase der Erforschung ausprobieren, um erst dann in die Phase der regelmäßigen Nutzung überzugehen.

Ein weiteres Argument für eine große Produktpalette: Kunden drücken durch ihre Kaufentscheidungen auch immer ihre eigene Persönlichkeit aus. Es ist daher wichtig, ihnen Entscheidungen zu ermöglichen, die zu ihrem Selbstbild passen. So entstehen echte, individuelle Kauferlebnisse.

Potentiale von Entscheidungsmöglichkeiten erkennen

Bei der Frage nach der optimalen Produktauswahl sollten Einzelhändler immer im Hinterkopf behalten, dass Kunden sich gerne entscheiden – und nicht schlichtweg passiv auf Werbenachrichten reagieren. Eine effektive Möglichkeit, um die Balance beim Produktangebot zu erhalten, sind personalisierte Empfehlungen und Erlebnisse. Hier gibt es verschiedene Möglichkeiten, das Einkaufserlebnis der Kunden zu optimieren. Sei es im Direktmarketing oder ein digitaler Assistent, der während des Online Shoppings Hilfestellung gibt – alle Empfehlungen sind angepasst an den jeweiligen Kunden, basierend auf den individuellen Daten vorheriger Einkäufe und Vorlieben. Ein intelligenter Algorithmus könnte zusätzlich Rabattaktionen auf Relevanz für die Kunden testen und diese dann dementsprechend auf Angebote aufmerksam machen. Unternehmen ermöglichen durch diese personalisierten Empfehlungen ein individuelles Erlebnis für Kunden und können gleichzeitig eine große Produktvielfalt bieten.

Kunden müssen Entscheidungen treffen können, die zu ihnen passen und sie zufriedenstellen. Das bedeutet für Unternehmen verstaubte Taktiken und Tricks zu vermeiden und stattdessen in die Entwicklung von Alternativen zu investieren. Welche Produkte passen zu dem Lebensstil der Kunden? Welche Einkaufsgewohnheiten haben sie, welche Eigenschaften von Produkten sind ihnen wichtig? Können Händler diese Fragen beantworten können sie den Konsumenten ein spannendes Einkaufserlebnis bieten – durch das richtige Maß an Entscheidungen.

Every customer transaction creates data which has value, but turning this data into actionable insights is the bedrock for creating new revenue. And in this increasingly tough retail environment, alternative revenue streams are too important to ignore. But there’s a right way (and plenty of wrong ways) to monetise data, so it’s important to understand what’s involved.

Join our Data Monetisation Masterclass, to learn how the critical components of best-in-class data monetisation can make all the difference to the success of your strategy.

In this webinar, we’ll cover the steps your business needs to take to monetise:

• Data – what types of data do you need?
• Culture – does your business have the right skills?
• Commercial approach – which model is right for your business?
• Technology – will current systems and analytics enable monetisation?
• CPGs – what level of involvement will you need from your suppliers

Join us on Wednesday, October 16 at 3:30pm GMT / 9:00am CT

Register now   

Since 1989 dunnhumby has been analysing Customer behaviour to help retailers prepare for the future. We've witnessed some enormous changes in the retail industry over the past 30 years, from what people eat, to how they shop. So, what's on the horizon for the future of customer experience?

Kyle Fugere, Global Head of Ventures & Labs at dunnhumby, shares his views on how tech will change retail in the next 30 years.

Customer Experience has been described as ‘the pulse of every business’ and is fast becoming a vital differentiator in a rapidly commoditized retail environment. But getting it right is something that many retailers and brands still grapple with every day. This month for our 3 minute interview, we talked to Debora Franchim, Customer Engagement Capability Director for dunnhumby LatAm, to understand where retailers and brands struggle most with their approach to Customer Engagement...

With Customer Experience becoming an important differentiator, what factors do you think retailers and brands need to prioritise more than ever to excel in this area?

The first step retailers and brands need to take is to acknowledge the Customer journey in all its complexity. The Customer has to be at the centre of the decision, not the retailer, not the brand, and not the product. This Customer First approach should influence the retailer’s understanding of their entire shopping experience.

A Customer’s journey with a retailer doesn’t start when they enter the store, but when they realise something is missing at home. They will think about how to fulfil this need, which could be to go to the store and get it, to go online and buy it, to borrow from someone, among many other options. Retailers and brands need to be aware of the Customer’s decision making mindset, to ensure they are an option – preferably the main one – in the Customer’s mind at that moment.

What do you see being the biggest challenge that retailers face in putting Customers First?

Corporative organization is still a challenge, as goals, KPIs and ways of working reflect that. Many retailers still have Commercial, Operations, Marketing and Trade as separate teams in different areas, sometimes under different vice-presidencies. This means each one of them has their own agenda, sometimes contradictory, and usually not focused around the Customer.

For example: the Commercial/Buying team might be measured on obtaining the best cost-price negotiation possible with a CPG supplier/vendor, and the Marketing team might be measured on their ability to increase market share, and the Operations team might be measured on increasing sales in each store. So, who is looking at the Customer journey and the entire end-to-end shopping experience? Even if Marketing does – usually the first area to address it – how will they ensure the right products are in-store and that a physical store will also influence a Customer to buy online as well? Without the entire business being measured on Customer KPIs, it is very difficult to succeed at becoming a truly Customer First organisation.

Tell us a little bit about how the Customer Engagement team at dunnhumby helps clients win.

We always bring the Customer into the discussion, challenging the decisions to make sure they are truly focused on Customer First principles. We have developed a deep understanding of Customer needs, combining transactional data and primary research to understand what Customers think, feel and do. Through our experience of working with many leading retailers and brands around the world, we’ve seen first-hand how providing a relevant and seamless shopping experience for Customers drives better financial performance. We help clients win through strategic and tactical recommendations which leverage Customer Loyalty.

What is your trend prediction for developments in Customer Engagement / Customer Experience in the near future?

A frictionless purchase journey, in which channels don’t matter. A Customer doesn’t care if it’s online or a physical store: not finding a product in-store that is available online, for example, will become unacceptable, as it is the same retailer – that’s what matters to the Customer. Receiving a push notification that says “online only” or trying to return a product and hearing “you didn’t buy in this store, you bought online, so you can’t return here” will be the type of interactions that will destroy the Customer experience and send once-loyal Customers directly to competitors.

This guest blog was authored by James Glover, President and CEO of Coherent Path, a dunnhumby Ventures portfolio company.

Everyone agrees on the importance of customer data in helping build relationships and guide customers on their retail journey. The problem is that many of us still subscribe to myths that are no longer true – if they ever were – about the most effective ways to win customers over and keep their loyalty. Here are a few prevailing myths, and the truth about how retailers can use customer data to become a valued partner in their customers’ retail journeys.

Myth #1: It's possible to predict each customer's retail journey in advance.

One thing that too many retailers get hung up on is trying to plan the customer’s journey for them. Rather than attempting to guide customers to a specific destination, retailers need to be responsive to their “journey through the journey,” focusing on improving customer experiences which can lead to increased loyalty and a more sustainable ROI in the long run.

Part of that comes back to how we talk about these sorts of ideas. We tend to say “the customer journey” as though there is only one, but really, every customer journey is unique, and there are as many different customer journeys as there are customers out there. Rather than trying to tell a customer what their journey should be, data can instead be leveraged to respond to the customer journey as it’s happening.

A successful modern email marketing program is able to turn the entire retail journey into an experience, one that is responsive to each customer’s evolving tastes and desires. The key lies in not trying to dictate what the customer’s journey is going to be but, instead, in using the insights that customer data is able to provide to help guide customers along the way.

Myth #2: Once you’ve won a customer over, they’re yours for life.

Retailers and marketers place a lot of focus on building relationships with customers – and, absolutely, building relationships is important – but just because you have a customer relationship doesn’t mean your work is done. Retailers who only focus on the start of a relationship will soon wake up to find the relationship they had taken for granted is gone.

A relationship with a customer is like any other relationship: it takes work, day in and day out. If you only tell your spouse that you love them on special occasions, your relationship probably won’t be as close as if you tell them every day. The same goes for customers.

Many retailers only “touch” customers when they first attract them, when the customer makes a transaction, and when the retailer is trying to rekindle interest that has waned. Getting a customer used to hearing from you regularly, and not just when you’re trying to sell them something, will help build an actual relationship that leads to trust, loyalty, and, ultimately, a long-term return on your investment.

Retailers need to do the equivalent of buying them flowers “just because” in order to keep that bond strong; show them new and interesting things that keep them engaged and maintain a positive connection.

Myth #3: Getting your message in front of customers is more important than telling them what they want to hear.

Brands that succeed at building customer loyalty are ones that know when to show the customer something new, when to show them something they are already interested in, and when to take a step back. Inundating a customer with too many emails, especially ones they aren’t interested in, is a quick way to lose that customer. According to the Direct Marketing Association (DMA)[1], 59 percent of people said that they unsubscribed from email marketing lists due to receiving too many emails, while 43 percent cited receiving emails that weren’t relevant.

The challenge for email marketers is to know how to reach out to customers in a way that the customer will find engaging. How do you incorporate what you have to say into their retail journey, without trying to dictate that journey for them? It’s a constant give and take of adding new experiences to their diet while also keeping the content they see relevant to their interests.

What’s more, tastes change over time — and what a customer wants today may not be what they’re interested in tomorrow. Keeping up with and adapting to those changes is challenging, and it’s unreasonable to expect marketers to keep tabs on each customer’s evolving journey manually. That’s why marketers need to embrace solutions that use data to adapt to a customer’s changing palate in real time.

Ultimately, the retailers of the future will not be a destination for shoppers, but rather partners in their retail journey. This means helping customers to explore paths and find products they might not otherwise have known to look for and building relationships that go beyond a few transactions to last a lifetime. In order to do that, though, retailers need the help of customer data and the insights that it can provide.

[1] https://www.linkedin.com/pulse/dma-consumer-email-tracker-report-2019-key-findings-jenna/

An effective pricing framework relies on intelligent, strategic planning. But how can you know you’re setting the right base prices, and avoid falling into the trap of constantly comparing yourself to competitors?

Start by taking control of how your customers perceive you and your prices. Evaluate where you, as a business, sit within the wider market.

Here are five key steps to creating the right pricing strategy for your business.

1. Set strategic goals

Price perception is NOT your price index

The pricing function is often done in a vacuum. The executive team understands the importance of price perception, but often lacks the knowledge of what specific levers to pull. In contrast, the pricing team is focused on getting prices right, but often fails to grasp the broader significance of price perception and how it influences the retailer’s market position.

In addition, the pricing process is a stressful balancing act that bounces between different objectives: drive traffic, hit margin rate, and refine competitive price actions. Finally, conflicting priorities (for example: new formats, wellness efforts, digital) often compete for the same pot of investment dollars and focus. 

The solution to this problem is a broad pricing strategy that includes both the executive and pricing teams. Identifying the price sensitivity of your customer base and how they perceive your prices when compared to your key competitors are outputs of the first step.

2. Ace your base prices

Focus on price perception, not price index

It’s important to remember you don’t always need to match your competitors on price. If you do, you’ll fall into a continuous loop of price-matching, each reducing your price to compete with the other – and nobody wins in that scenario. You should instead determine the key products that have the most influence on price perception and invest in them fairly and competitively.

Maintain base hygiene factors

Think logically. Making sure the prices displayed on the shelves match those on the system is key when it comes to establishing trust with the customer. Check that the base prices are logical, correct, and make sense across your banners.

3. Establish a customer first pricing policy

Put the customer at the heart of your strategy

Determine which categories your customers care about the most to pick and prioritise the categories that need to be more competitive. Define pricing rules using customer prioritization, competitive positioning, product roles and financial objectives. Document rules on how to maintain hygiene factors and logic at the shelf. Periodically revisit the policy and make tweaks as required.

This strategy worked exceptionally well for one of our North American retail partners. By focusing on products important to their customers’ price perception rather than lowering prices across the board to match the price leader, they experienced 95% sales growth over 10 years. Their prices remain 10% higher than the price leader. In addition, this approach increased the weekly spend of their loyal customers – who now contribute 21% to overall revenue, up from 16%.

4. Execute your plan

With your pricing policy in place, you should be ready to launch your strategy. Here’s a quick checklist:

• Execute pricing that follows the rules set by your policy
• Check that products have been priced or are being promoted based on that product’s role within your market
• Monitor competitor price changes
• Pay close attention to market impacts, competitor price changes and vendor cost price changes
• Keep track of performance and adherence to the pricing policy

5. Review internal price and promotion capability

Across your service, a unified view is as important as a unified process, and everything you roll out depends on capability. Having a strong Price and Promotions team who have power within the organisation and the right data and tools will help you implement your strategy more quickly, and to a higher standard.

The outcome

Following these five steps can help you create a pricing strategy you can trust and careful planning is the key. By understanding your position in the market, you can set a clear roadmap, monitor performance, and rise above price wars with the competition. An effective and sustainable pricing strategy is the bedrock for a thriving business and happy customers.

Need support? Our P&P Strategic Advisory Services help retailers around the world to understand and improve their Price Perception. Contact us to find out more.

The second annual dunnhumby Retailer Preference Index for the Convenience Channel explores the $654.3 billion US convenience market. The study focuses on:

• What drives customer preference for convenience stores?
• Which retailers are winning and losing? And why?
• What can c-store retailers do to improve performance and win more trips?

Existing ranking methods focus primarily on retail growth based on store counts and revenue size, without linking growth to emotional or financial performance. We have a different perspective, one that focuses on the consumer and their emotional connection to the various retailers within the Convenience channel. Our study surveyed nearly 7,000 US consumers to uncover how they think and feel about c-stores, and how they shop them to understand how Customers perceive Quality, Convenience and Price, and how these perceptions affect both the emotional connection and financial performance.

Our goal: to help retailers better understand their customers to deliver a value proposition that aligns with their needs, to earn more trips and drive sustainable growth.

To learn more, download a free copy of the report. If your company is in our report and you'd like your complimentary custom retailer profile, contact us.

The retailers included are:

7-Eleven
ampm/ARCO
BPShop
Casey's General Stores
Chevron Food Mart/ Extra Mile
Circle K
Cumberland Farms
Exxon On the Run
GetGo
Holiday Stationstores
Kum & Go
Kwik Trip/ KwikStar
Maverik
Meijer Gas Stations
Mobil On the Run
Murphy USA
QuikTrip
RaceTrac
RaceWay
Royal Farms
Sheetz
Shell
Speedway
Thornton’s
Turkey Hill Minit Markets
Wawa

Many Companies are asking the same question, can Customer behavior be changed? We set out to help one of our clients answer this exact question and came away with key insights to share.

In October 2019, we published our 2nd edition of the Retailer Preference Index: Convenience Channel edition to explore the $654.3 billion market. Our goal: to understand what drives consumer preference for the top 27 U.S. Convenience retailers based on responses from around 7,000 U.S. households. This is the first study that quantifies retailer preference, based on a combination of emotional connection and retailer preference. 

Here are a few of the key takeaways for retailers to consider:

To learn more, download a free copy of the report. If your banner is in our report and you'd like your custom banner profile, contact us. 

The list of banners evaluated, in alphabetical order, include:

7-Eleven
ampm/ARCO
BPShop
Casey's General Stores
Chevron Food Mart/ Extra Mile
Circle K
Cumberland Farms
Exxon On the Run
GetGo
Holiday Stationstores
Kum & Go
Kwik Trip/ KwikStar
Maverik
Meijer Gas Stations
Mobil On the Run
Murphy USA
QuikTrip
RaceTrac
RaceWay
Royal Farms
Sheetz
Shell
Speedway
Thornton’s
Turkey Hill Minit Markets
Wawa

With great customer data comes great opportunity. Today’s retailers have access to more data than they’ve ever had before, and smart use of it can give them an invaluable competitive edge in challenging conditions.

But if you’re thinking of developing a new data monetisation strategy, or overhauling an existing one, it’s worth assessing your starting point first. Understanding the critical components of good data monetisation can make all the difference to the success of your strategy.

You’ll also need to understand how your data will support the decisions you want to make and execute against, plus the role of CPGs in key decisions like ranging, promotions planning and in-store and online media.

The most effective data monetisation strategies are built on four key pillars. Get these in place and you can move forward with confidence.

1. Data

The best strategies are driven by insights into customer behaviour, not just sales data. Everything from how often they’re shopping and how much they’re buying, to how many premium products they’re opting for. The more you know about what your customers are doing in-store and online, the more customer-centric the resulting recommendations will be. You can’t build a data monetisation strategy that will transform your business on transactional sales data alone.

This means that the first thing you’ve really got to get in place is the right data. Ideally this will have been collected through a CRM programme, such as a loyalty card with a coverage of at least 50% of customer base.

Once collected, you’ll get the most from your data by merging it into a single database. This means information from different categories and locations can be analysed together, creating a consistent data-driven customer language. You and your CPGs can then use this consistent language when talking about category and brand performance, and use consistent KPIs to track and measure success.

Used correctly, your data will provide a framework for shared workstreams to better meet the needs of your customers.

2. Culture

As we’ve discussed previously, the retailers competing most strongly at the moment are those who are putting customer needs first. If you have a customer-centric culture embedded from the top of your organisation to the bottom, you’ll find it significantly easier to get the most out of data monetisation. This is because your whole organisation – including buyers, category management and insight teams, and merchandisers – needs to focus on understanding customers, not just sales and margins. It can’t just be the responsibility of one team.

Monetisation strategies are successful when they equip the retailer and their suppliers with the insights to work together to achieve category level objectives. As a retailer, if your working relationship with your suppliers is already based on trust, transparency and collaboration, rather than the traditional ‘them vs us’ dynamic, you’ll find this comes easily.

Some retailers have concerns about transparency – not wanting to share category insights with CPGs or fearing that doing so reduces their power in the relationships. But at dunnhumby, we always argue that the CPG needs to see the insights for the whole category, not just their product. This enables them to really understand how they can support the performance of the category and align their brand portfolio to meet this objective.

Together, you can collaborate to:

• Ensure trade planning focuses on promoting products that generate sales uplift for the category, instead of negotiating the funding of promotions
• Ensure range planning meets the needs of customers, rather than focussing on increasing space for margin-driving SKUs for a single brand

Processes are another area where retailers can give themselves a head-start. If you have a properly documented category management process in place that’s compliant and used across your category teams, the tools of data monetisation will be much easier to use.

If you also bring CPGs into the process, you’ll benefit from an external view, category expertise and a competitor retail perspective. Empowering one or two key suppliers in the category as ‘category captains’ can ensure you’re making full use of their experience, resource and knowledge. When customer data is embedded into a work plan supported by an end-to-end, ‘insight to execution’ process, your successful customer-led category strategy will be easier to realise.

3. People

Is someone in your organisation leading the commercial workstreams related to your customer data? Your chances of success will be greatly helped by having people dedicated to the workstream.

Within retailers with successful data monetisation strategies, we’re increasingly seeing Heads of Marketing Strategy or Heads of Monetisation being appointed to lead the initiatives. Whatever their title, to drive a successful strategy you need someone in charge who is less focused on getting product to shelf and more aligned with innovative revenue streams.

Once your monetisation strategy has been defined, it’s crucial this is led by the head of buying or category management and executed by every category buying and management team. It’s here that the day-to-day working relationships with CPGs will be formed, shared work plans created, KPIs for success defined and the insight to activation executed.

You may also need to look at your skillset within data management. Customer data is much more sophisticated than sales data. Your staff may not have the skills right now – but upskilling them will help you cut through the noise in the data and ensure the right insights are used.

4. Technology

Assessing your organisation’s technology against a few key questions will decide whether you are better off bringing in an external specialist:

1. Have I made the right investments, in CRM or loyalty programmes, to generate the data I’m going to need? Am I therefore collecting the right data?
2. Am I managing the data I’ve collected effectively by storing it centrally and enabling analysis and other value-add insights?
3. Is my business able to access the data and output of analysis, and use it to make better business decisions?

If you’re not confident that your in-house technology meets these criteria, outsourcing to a specialist can save you considerable time and money. That way, you’ll also benefit from the best-in-class tools.

When you’re building a monetisation strategy and assessing your capabilities against these four pillars, it’s crucial you keep your CPGs in mind. How will you embed them into the process? Which insight solutions will you make available to them? And what decisions would you like your CPGs to be involved with?

Having a clear understanding of who your customers are and how they behave doesn’t just support better in-store execution of category and promotional workstreams. With this knowledge, you’ll be able to activate more relevant, personalised and timely media, both in-store and online, to support your new in-store execution. This means your customers will experience more personalised, relevant offers, your CPGs will benefit from highly targeted, clearly measured campaigns and you’ll benefit from the category sales uplift generated from a seamless coordinated multi-channel campaign.

The other day I saw in Forrester's Predictions Report that 20% of companies wanted to reduce their Customer Experience investments and go back to price reductions for short-term gains and that 25% wanted to cut back on their digital investments, even though they knew they would lose market share. It seemed harshly realistic.

Daily, we’re having strategic and tactical conversations with retailers, often involving discussions about customer experience, AI, machine learning, super apps, but with the same urgency: what do we have to do tomorrow to recover the lost sales of the weekend? On which products will we reduce prices and how can we effectively communicate with the customer to bring them to the store?

This is the true challenging scenario many retailers face when developing loyalty strategies. It is common to go through the traditional points / offers / partnerships dilemma, but at the end of the day, the big decision will be how to combine two worlds which in theory are opposite: short and long term results, immediate reward and lasting emotional connection, an app that calculates your reward in real time and stamps collection over months.

United recently did a campaign where they sent a push notification to their customers telling them there was a craft beer bar in front of its departure gate so they could try a new drink while waiting for their flight. The person who presented this as a success case study said, "simple and brilliant". It is brilliant, but not simple. There is a complicated process behind this communication: it takes a unique customer database, identifying those customers who are on that flight connection, making sure they actually board that gate, making sure they are old enough to drink, checking that the airport has Wi-Fi, send only during bar opening hours, think of a contingency plan if the flight has been canceled. Have a campaign manager platform that allows all these variables. Calculate the ROI of this campaign.

Perhaps that is why 20% of companies want to cut back on customer experience investment and return to the traditional price war. Is this a belief that we are returning to simpler times? Back to the basics?

No, we don’t believe that. The industry must embrace the challenge and create customer engagement propositions that address both extremes: the basic and the sophisticated. It's no longer a question of “do points work?” or “two tier price is the best solution”: in the age of personalisation and automation, we have to make sure we use technology to solve real problems, putting the customer at the center of decisions, and avoid getting distracted by innovations that don’t support the Customer journey.  Is it useful? Let’s do it. It's trendy, but I can't think of a utility? Maybe this is not the time. And the solution will be different for each retailer as the needs are not the same. Retailers should not be tempted to rely on generic KPIs for decision making: what are the needs of your customers and your business?

With clients on every continent, we see similar challenges facing retailers and brands around the world, even in companies that are at different stages of engagement with their customers. In Latin America specifically there is a strong movement towards digitization and launching multi-purpose mobile apps that take Customer relationships to the next level. The greatest challenge here is to ensure that the features in the app are relevant and address customer needs. And that the channel is not viewed simply as just a channel, but the enabler of a modern engagement strategy, based on the right concepts, which always has the customer at the center. Simple. And brilliant.

Dia desses vi no Relatório de Previsões da Forrester que 20% das empresas pretendem diminuir seus investimentos em customer experience e voltar à velha tática da redução de preços para ter ganhos de curto prazo. E que outras 25% pretendem reduzir seus investimentos em digital, mesmo sabendo que perderiam market share a longo prazo. Me pareceu algo duramente reducionista. 

Estamos diariamente em conversas estratégicas e táticas com nossos clientes, e é comum termos discussões sobre temas como customer experience, AI, machine learning esuper apps, mas, com a mesma intensidade, discutimos também o que tem de ser feito já amanhã para recuperar a venda que não veio no final de semana. De quais produtos vamos baixar o preço e como vamos efetivamente comunicar isto ao cliente para trazê-lo à loja? Importante ressaltar, portanto, que um tipo de movimento não exclui e nem pode excluir a necessidade do outro.

Este é o verdadeiro cenário desafiador que encontramos em nossos clientes varejistas para criar e desenvolver estratégias de fidelidade e, ao mesmo tempo, resolver as questões de receita imediata.

É comum passarmos pelo tradicional dilema do tipo “pontos versus ofertas versus parcerias”, mas, no final do dia, a grande decisão será sobre como aliar esses mundos em teoria opostos: o resultado de curto e longo prazo, a recompensa imediata e a conexão emocional duradoura, o app que calcula sua recompensa em tempo real e os selos colados em uma cartela ao longo de meses.

Penso, logo desisto

A United fez uma ação recente nos Estados Unidos em que enviava um push aos seus clientes em conexão, contando que havia um bar de cervejas artesanais em frente ao seu portão de embarque, para que pudessem experimentar uma cerveja nova enquanto aguardavam o horário de seu voo.

Quem apresentou esta ação como um case de sucesso resumiu a ideia como “simples e brilhante”. De fato é brilhante, mas não é simples. Existe um longo caminho para o que cliente certo receba este push: ter uma base de dados de clientes únicos, identificar aqueles que estão naquela conexão, garantir que realmente embarcarão naquele portão, se certificar de que possuem idade necessária para beber, verificar se o aeroporto tem wifi, enviar apenas nos horários de funcionamento do bar, pensar em um plano de contingência caso o voo tenha sido cancelado.

E mais: ter uma plataforma de gestão de campanhas e envio de push que permita todas essas variáveis e, finalmente, calcular o ROI dessa ação.

Talvez seja por isso que 20% das empresas querem diminuir o investimento em customer experience e voltar à guerra de preços. Seria essa uma crença de que assim estamos confortavelmente voltando a épocas mais simples? Back to the basics?

Não, não podemos acreditar nisso. Temos que abraçar o desafio, e criar propostas de engajamento com o cliente que endereçam os dois extremos: o básico e o sofisticado. Não é mais uma questão de responder a pergunta: “o sistema de pontos funciona?” ou: “dois níveis de preço é a melhor solução”? Na era da personalização e automação, temos que garantir o uso da tecnologia para resolver problemas reais, colocando o cliente no centro das decisões, e fugir da inovação pela inovação, mas também fugir do primitivismo.

Encontre os indicadores certos

Inovar é útil? Então sigamos em frente. Está na moda, mas não consigo pensar em uma utilidade? Talvez não seja o momento. E a solução será diferente para cada cliente, pois as necessidades não são as mesmas. Não podemos cair na tentação de nos apoiarmos em indicadores genéricos para a tomada de decisão: quais são as necessidades do seu cliente e do seu negócio?

Com clientes em todos os continentes, é comum vermos na dunnhumby desafios semelhantes, mesmo em empresas que estão em diferentes culturas e em estágios diferentes de engajamento com seus clientes. Na América Latina, especificamente, existe um movimento muito forte de digitalização da comunicação e disseminação de aplicativos. Enquanto alguns de nossos clientes na Europa ou América do Norte ainda estão avaliando qual o melhor caminho para a digitalização, na América Latina todos lançaram ou estão prestes a lançar seus aplicativos com múltiplas funções, que levam a relação com o consumidor a um novo patamar. O desafio que temos que nos colocar nestes casos é garantir que as funcionalidades existentes no app sejam de fato relevantes e enderecem as necessidades dos clientes. E que o canal não seja um simples canal, mas a tangibilização de uma estratégia de engajamento moderna, pautada nos conceitos corretos, que sempre tem o cliente no centro. Se todas essas premissas estiverem presentes na ideia e no processo, aí sim, pode valer a expressão: “simples e brilhante”.

How can retailers ensure that their Customers have access to the right products on every shopping trip - that every experience is local and personal? It all starts with harnessing and integrating Customer data to derive actionable insights. This month for our 3-minute interview, we talked to Daniel Mattern, Capability Director for dunnhumby’s Asia Pacific region, to learn more about the importance of their categories, investments and marketing activities.

Customer-centric rather than product-centric category management is key to driving category growth – but what should retailers prioritise to excel in this area?

Let’s start with having the right end in mind. You want your customers to find what they want, when they want it, where they want it – whether this is in a physical store or a virtual one and at a price they perceive as fair.

The first thing you need to be great at is understanding. You need to obsess about your competitors less and about your customers more. Harness the power of the data to build unparalleled knowledge of the person whom your business has the honour to serve. Which categories and products matter most to them? What elements of a particular category proposition will make most difference to them - is it unbeatable price or exciting new products?

Armed with this knowledge, you need to decide how you want to win your customer’s heart. You cannot be the best at everything – but you need to aim to be the best in something that is very relevant to your best customers. This is equally true for enterprise level strategy and daily activities. In terms of Category Management it means incorporating customer insight into decision-making every day, from which categories you should invest in or where they should be placed to how much money should be invested in price or innovations.

The third crucial thing is managing the change. A lot of strategies fail because they are not delivered consistently across all touchpoints. The plan needs to be tangible in every business activity and relevant for everyone in the company – and that means reflected in principles, policies, personal targets and success measures.

What do you see being the biggest challenge that retailers face in putting Customers First (particularly in APAC region)?

Catching up with customers of today and tomorrow! Customer needs and expectations have always been evolving but it’s fair to say probably never so quickly. Already today’s customers expect seamless integration of digital and physical, the majority of purchases start with browsing – but mostly still finish with picking a product in-store.

But change will be constant. This first generation of digital natives with always-connected gadgets will soon be the most influential shopper group. And retailers need to think now how to cope with their needs tomorrow and in the future.

Equally, many challenges reside within the organisations themselves. I would say the tendency to work in silos is one challenge facing many retailers around the globe, not just the APAC region. The siloed approach can cause any customer-first effort to fail – as it will not have a chance to reach the customer.

Tell us a little bit about how Category Management Capability Team at dunnhumby helps clients win.

Our mission is to help our clients make a positive change for their customers and ultimately their businesses.  By helping retailers understand client needs, we recommend the optimal solutions to address the particular problems they face. By starting with a category healthcheck, we can provide an objective assessment of their category management strengths and weaknesses and identify where are the biggest barriers to unlocking the potential of category growth.

What emerging trends do you see in the Category Management space? How do you think the discipline will evolve in the near future?

Well, as a self-confessed science and technology obsessive, I may be biased, but I can see how leveraging science and tech within the discipline of category management is creating change in a meaningful way. Retail is traditionally a very pragmatic business so rather than getting distracted by buzz around terms like AI, I would call out practical ways to address some of the same challenges I mentioned above. Like using digital changing booths, digital showrooms or smart mirrors to bridge the gap between the convenience of online and the assurance of physical shopping. Or using robots and drones in supply chain to alleviate labour force availability and cost challenges. Or using predictive science to help determine a customer’s wants and needs – a trend we are driving in the industry.

Comment maximiser la valeur de vos données clients et transformer vos données en nouvelles sources de revenus ? Voilà des questions que se posent de nombreux distributeurs.

Rejoignez notre webinaire, Mercredi 4 Décembre à 10h30, pour comprendre pourquoi et comment la monétisation des données clients peut faire toute la différence dans le succès de votre stratégie.

Dans ce webinaire, nous expliquerons les étapes à entreprendre pour commencer à monétiser :

• Données - de quels types de données avez-vous besoin ?
• Culture - votre entreprise a-t-elle les bonnes compétences ?
• Approche commerciale - quel modèle convient le mieux à votre entreprise ?
• Technologie - les systèmes et les analyses actuels permettront-ils la monétisation ?
• CPGs - comment allez-vous collaborer avec vos fournisseurs ?

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The holiday shopping season is right around the corner and like any other holiday season, shoppers will be on the hunt for the best deals on the market. With 30% of a retailer’s annual revenue coming in during the months of November and December, it’s more important than ever to plan a winning media campaign to be well-positioned for success during the year’s biggest revenue push.  

Download our 2019 Holiday Insights Report to see what trends to expect in 2019 and how dunnhumby media can help you build a winning Holiday media strategy.

Facing rising costs and shrinking margins, finding new revenue streams should be an urgent priority for grocery retailers the world over. Blessed with volumes of valuable customer data and a rich menu of owned media, this unbeatable combination provides enormous scope for creating sustainable growth. Yet so many grocery retailers are struggling to make this a reality.

To better understand why so many retailers aren’t taking advantage of new revenue streams while improving the shopping experience for their customers, we commissioned a global study with Forrester Consulting. Download your complimentary copy of Forrester’s research to learn about the barriers holding retailers back from revenue generation and the recommendations to overcome the challenges.

Key findings

• 85% of grocery retailers have identified creation of new revenue streams as a priority for 2020
• Despite high levels of confidence in their data strategies, only 15% of retailers have the right capabilities, people, technology, and processes to improve customer experience and monetize their data.
• Most are also missing out on lucrative revenue through monetizing their media. Challenges with data, technology, expertise, and culture are the greatest barriers to progress.
• Retailers who are able to successfully utilise data insights, are reaping benefits with 61% seeing an improvement in the customer experience and 56% seeing growth in existing revenues and revenue streams.