tag:blogger.com,1999:blog-86792878518734866462024-03-14T17:04:23.447+00:00SG-retail Random musings about retail, customer engagement, "big data", social media analytics, customer loyalty & CRM.
For more information please visit www.sg-retail.co.ukSteve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.comBlogger36125tag:blogger.com,1999:blog-8679287851873486646.post-7597660107836547232020-06-05T13:22:00.002+01:002020-06-05T13:23:01.006+01:00You need a loyalty programme and its not why you think <div class="ember-view" id="ember6007" style="background: rgb(255, 255, 255); border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.9); margin: 0px; padding: 0px; vertical-align: baseline;"><div class="reader-article-content" dir="ltr" style="background: transparent; border: 0px; box-sizing: inherit; line-height: 1; margin: 0px; padding: 0px; vertical-align: baseline;"><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"></p><div class="reader-flag-content__wrapper mb4 clear-both" data-ember-action-6008="6008" data-ember-action="" style="-webkit-text-stroke-width: 0px; 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border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.9); font-family: -apple-system, system-ui, BlinkMacSystemFont, "Segoe UI", Roboto, "Helvetica Neue", "Fira Sans", Ubuntu, Oxygen, "Oxygen Sans", Cantarell, "Droid Sans", "Apple Color Emoji", "Segoe UI Emoji", "Segoe UI Symbol", "Lucida Grande", Helvetica, Arial, sans-serif; font-style: normal; font-variant-caps: normal; font-variant-ligatures: normal; font-weight: 400; letter-spacing: normal; margin: 0px; orphans: 2; padding: 0px; text-align: start; text-decoration-color: initial; text-decoration-style: initial; text-indent: 0px; text-transform: none; vertical-align: baseline; white-space: normal; widows: 2; word-spacing: 0px;"><div class="reader-article-content" dir="ltr" style="background: transparent; border: 0px; box-sizing: inherit; line-height: 1; margin: 0px; padding: 0px; vertical-align: baseline;"><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi4tHsOPT2qo-LIig5ih3Pku7m0I1yjTE_xtXh3h4bJ1XyznOB-4QwTZalp7FVeuE4uwqLni50tlxH_9FyGBZLNMUwbkS8JvJeADd6eHlJwis_jNc4AuyAPmZdzn0dhRDAW5sYNnQ1Ma2Xo/s539/northumberland+st+cropped.GIF" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="286" data-original-width="539" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi4tHsOPT2qo-LIig5ih3Pku7m0I1yjTE_xtXh3h4bJ1XyznOB-4QwTZalp7FVeuE4uwqLni50tlxH_9FyGBZLNMUwbkS8JvJeADd6eHlJwis_jNc4AuyAPmZdzn0dhRDAW5sYNnQ1Ma2Xo/s320/northumberland+st+cropped.GIF" width="320" /></a></div><font size="4"><br /></font><p></p><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"><font size="4">I was rather taken aback, nearly twenty years ago, when Simon Uwins, then Marketing Director at Tesco told me that the purpose of Tesco’s Clubcard programme was not to drive loyalty.</font></p><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"><font size="4">The launch of Clubcard had helped propel Tesco from the UK’s number 2 grocery retailer to the far and away outright market leader and to a large extent this growth had come from existing customers becoming more loyal, so it seemed a surprising thing to say.</font></p><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"><font size="4">Uwins explained that the key driver of loyalty for any retailer, was the overall brand proposition and customer experience, the loyalty programme served a different purpose.</font></p><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"><font size="4">Tesco had encapsulated their brand and customer experience proposition in the phrase “every little helps” which was itself one of four marketing pillars alongside “everyone is welcome”, “build trust” and “say thank you” that helped Tesco deliver its core purpose of "earning and growing the lifetime loyalty of our customers".</font></p><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"><font size="4">The brand and experience proposition had, in turn, been broken out into component parts, forming 5 promises, each articulated from the point of view of the customer and each providing the whole organisation with clarity and focus on the things that mattered and the tasks that needed to be managed and measured :</font></p><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"><font size="4">“I can get what I want” , “the prices are good”, “the staff are helpful” , “the aisles are clear” , I don’t have to queue”.....to which these days they might add "its safe to do so"</font></p><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"><font size="4">So, what is the purpose of the loyalty programme I asked ?</font></p><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"><font size="4">Uwins replied that it was 4 fold :</font></p><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"><font size="4" style="line-height: 1;">a) A way of saying thank you to customers</font></p><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"><font size="4" style="line-height: 1;">b) A way of knowing who customers are</font></p><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"><font size="4" style="line-height: 1;">c) A platform to help understand customers</font></p><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"><font size="4" style="line-height: 1;">d) A platform that could enable differentiated service and communications </font></p><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"><font size="4">As we emerge from the lockdown I think many retailers will benefit not just from their existing loyalty programme - which from personal experience can sometimes deliver incremental sales by as much as 20% - but also from the clarity of purpose and customer centredness that are Tesco’s hallmarks.</font></p><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"><font size="4">In some businesses a tiny % of customers deliver 80-90% of the profits, in others certain groups have totally different shopping requirements to others.</font></p><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"><font size="4">The need to be able to provide differentiated services for certain customer groups is accelerating, as are the opportunities and expectations of customers from personalised communications and experiences. Any business that expects to survive and thrive needs a deep understanding of its disparate customers, as they are not the same and don't expect to treated equally.</font></p><p style="background: transparent; border: 0px; box-sizing: inherit; color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-weight: 400; line-height: 1; margin: 3.2rem 0px; padding: 0px; vertical-align: baseline;"><font size="4">These are the key reasons for retailers and others to consider a loyalty programme if they don’t have one already. Thanks to technology advances, set up and operations are simple and easy, and in addition to P&L benefits, a well designed programme can become a monetisable asset – sometimes worth many times more than the host brand itself - as airlines are currently discovering.</font></p></div></div></div></div><div class="reader-flag-content__wrapper mb4 clear-both" data-ember-action-6008="6008" data-ember-action="" style="background: rgb(255, 255, 255); border: 0px; box-sizing: inherit; clear: both !important; color: rgba(0, 0, 0, 0.9); display: flex; font-family: -apple-system, system-ui, BlinkMacSystemFont, "Segoe UI", Roboto, "Helvetica Neue", "Fira Sans", Ubuntu, Oxygen, "Oxygen Sans", Cantarell, "Droid Sans", "Apple Color Emoji", "Segoe UI Emoji", "Segoe UI Symbol", "Lucida Grande", Helvetica, Arial, sans-serif; font-size: 1.5rem; justify-content: flex-end; margin-bottom: 16px !important; margin-left: 0px; margin-right: 0px; margin-top: 0px; padding: 0px; vertical-align: baseline;"></div>Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com1tag:blogger.com,1999:blog-8679287851873486646.post-66347852447611055482018-02-02T13:31:00.001+00:002018-02-02T13:31:20.976+00:00What should Sainsburys do now that they own Nectar ? Here’s my 10 point plan <!--[if gte mso 9]><xml>
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<br />
<div class="separator" style="clear: both; text-align: center;">
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<span style="font-family: Arial,Helvetica,sans-serif;">Sainsburys announced this week that they have acquired
Nectar and sister company i2C for £60m. </span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">For the sellers Aimia it marks an in glorious retreat from
the UK that spelled disaster for their shareholders, having paid £380m for
Nectar in 2008, 10 years later they have sold it for a fraction of their
outlay, concluding that they have taken the programme as far as they can.</span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">For the purchasers the prospects are much more encouraging
and so the question is begged ,what should Sainsburys do now that they are in
full control ? </span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">Here are my thoughts<span style="mso-spacerun: yes;">
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<span style="font-family: Arial,Helvetica,sans-serif;">1. Firstly they should continue with what’s working. Around
15m people regularly swipe their Nectar card, the vast majority of them in
Sainsburys but also including BP, ebay, Europcar and various other online
merchants. There’s nothing immediately broken at the front end, although, as we
will see later there are many ways they can make it better for customers and
more profitable for Sainsburys. </span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">2. They should build strong relationships with existing
partners and continue to try and find new ones<span style="mso-spacerun: yes;">
</span>- particularly those of interest to Sainsburys top 5% of customers.
Nectar plays a valuable role for BP and the other partners. They don’t compete
with Sainsburys who get the benefit of redeeming many of the points earned
outside Sainsburys, which cost them nothing, or increasingly with newly acquired
Argos. Sainsburys should reassure these partners that it is business as usual.
They should continue to seek partners that offer complementary services (but
given Sainsburys already have a bank, insurance telco & utility partnerships
that doesn’t leave a lot). Fashion, travel and specialist services. <span style="mso-spacerun: yes;"> </span></span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">3. They should re-confirm Nectar’s purpose as being : </span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">a) to help them in their declared aim of understanding customers
better than any other retailer</span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">b) to provide a low cost way to acquire new customers</span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">c) to provide a platform to better engage with existing
customers so they can deliver more relevant and personalised services </span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">d) to enable them to monetise supplier and third party
relationships</span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">This needs to be widely understood throughout the extended
Sainsburys business – bank, utilty partnerships, Argos etc so that marketing
monies that currently flow to Google, Facebook and others are wherever
possible, channelled through the Nectar platform. </span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">4. They should take an axe to Nectar’s cost base in two key ways
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<span style="font-family: Arial,Helvetica,sans-serif;">a) replace Nectar’s home grown and outdated IT systems with
a cloud based loyalty platform such as Prime Cloud from Loyalty Prime <i style="mso-bidi-font-style: normal;">(disclosure, we are advisers to Loyalty
Prime).</i> This would save £10’s millions in operating cost and headcount
whilst giving management much more flexibility in the way they are able to help
customers to earn and redeem their points. </span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">b) Shut down all attempts at building an International business.
I once attended a meeting at Nectar HQ to discuss a potential European venture.
There was an extraordinary number of strategy and European management in
attendance, all seeming very well paid and with no business to speak of. </span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">5. They should innovate with customers to enable payment
linked loyalty – allow customers to either register their personal Visa, Mastercard
or Amex payment cards so they don’t need to carry an additional card and
introduce a Nectar payment app (similar to Tesco Pay) to make things easier for
customers who want to pay by phone. </span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">6. They should enable customers to earn faster and much more
generously on their online shopping. <span style="mso-spacerun: yes;"> </span>They
have an online shop but this only gives customers about 75% of the value they
could earn from online specialists like Quidco. A simple “white label” partnership
with Quidco could be transformational (<i style="mso-bidi-font-style: normal;">disclosure
we work with Quidco on white label partnerships</i>) </span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">7. They should use AI to deliver mass personalisation at
scale. Nectar and sister company have done a good job in replicating the type
of targeted communications that were pioneered by Tesco and dunnhumby. There isn’t
much to choose between either service , each of which is in a lucrative monopoly
position as gatekeeper to their respective customer base. Selling targeted and
measurable media will continue to be a very profitable income stream funded by the
major branded suppliers like P&G, Unilever, Mars etc – at least until these
suppliers find ways to disintermediate i2c and/or dunnhumby, but that day still
looks far away. </span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">A big opportunity is to use new AI enabled tools like
ciValue that can automate the allocation of offers to customers based on
collaborative filtering and machine learning and automatically apply the governing
“customer contact and relevance rules” so that all customers get the best
available information or offer delivered at the right time via the right
channel. <span style="mso-spacerun: yes;"> </span></span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">Today the process for the above is highly manual, civalue <i style="mso-bidi-font-style: normal;">(disclosure – we act as advisers to ciValue)</i>
would automate the sourcing, strategic targeting, execution, measurement and
test and learn so that more communications can be delivered, more personally
and relevantly, at much lower cost. </span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">8. They should continue to give customers choice over their preferred
redemption channels. Many customers will want cheaper groceries, others want to
save for a holiday or special event. Let customers choose the path that’s best
for them. They should enable more digital redemption. It’s a crime against innovation
that Nectar is still largely card and paper based. </span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">9. They should introduce tiers and create a VIP programme
for the top 5% of customers who probably account for 30%+ of Sainsburys sales.
These are most likely to be high spending affluent families who shop online and
instore at Sainsburys, have a Sainsburys/Nectar payment card and have their utilities
and insurance through Sainsburys. There are many concierge style services that could
be offered to these customers – eg they could be allocated a Net a Porter style
personal shopper – that could be delivered profitably and would help to lock in
their lifetime loyalty and encourage others to engage in order to achieve similar
benefits. </span></div>
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<span style="font-family: Arial,Helvetica,sans-serif;">10. Finally, they should relaunch Nectar for Business.
Currently this is a fairly hopeless b2b programme with limited member or
partner participation. It could become a highly profitable programme that is
compelling for SMEs and tradespeople and the many big businesses who supply
them with goods and services, but it needs a new strategy, focus & leadership.
</span></div>
Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-68341821137572792322017-06-14T16:15:00.003+01:002017-06-14T16:36:14.412+01:00Solving the real time availability problem for clothing retailers<br />
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<b><span lang="EN-US" style="font-family: "calibri" , sans-serif; font-size: 14pt; margin: 0px;">At any point in time, most clothing retailers do not accurately know,
across all of their stores and channels, how many of the products they have
ordered, are currently available for customers to buy. </span></b></div>
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<b><span lang="EN-US" style="font-family: "calibri" , sans-serif; font-size: 14pt; margin: 0px;">This creates
disappointed customers who cannot buy what they want and is highly frustrating for staff, store owners and
their suppliers. It results in poor service, missed sales and significantly
higher costs. </span></b></div>
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<b><span lang="EN-US" style="font-family: "calibri" , sans-serif; font-size: 14pt; margin: 0px;">This is a multi-billion dollar industry problem but one that we can now help clothing retailers to solve. </span></b></div>
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<b><span lang="EN-US" style="font-family: "calibri" , sans-serif; font-size: 14pt; margin: 0px;">We can deploy RFID technology and AI to enable retailers to capture and deploy
real time stock availability data so they can increase sales, reduce waste and
deliver much better customer engagement </span></b></div>
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<b><span lang="EN-US" style="font-family: "calibri" , sans-serif; font-size: 14pt; margin: 0px;">The core of the proposition is a multi-channel Real Time Product
Availability Engine which uses RFID technology and AI to process product, order
and fulfillment, replenishment and returns data and translate them into
actionable insights that can be deployed in real time via retail applications and services including : ERP systems, order
management systems, logistics systems, store compliance and workflow solutions
as well as CRM, customer loyalty and customer service solutions</span></b></div>
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<b><span lang="EN-US" style="font-family: "calibri" , sans-serif; font-size: 14pt; margin: 0px;">The early adopters of this new technology are delivering stunning results. </span></b></div>
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<b><span lang="EN-US" style="font-family: "calibri" , sans-serif; font-size: 14pt; margin: 0px;">Real time availability data analytics are set to have as big an impact on clothing and fashion as the introduction of epos data in the 1980's and loyalty data in the 2000's. </span></b></div>
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Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-55346580709543525222015-12-31T14:51:00.001+00:002015-12-31T14:51:30.123+00:002016 - the year of cashback marketing ? <div>
The UK loyalty programme market is thriving as most retailers, other than those pursuing a discount led strategy, offer some kind of loyalty programme to supplement their core proposition and to help them to understand their customers. In recent months we have seen the launch of new programmes from Waitrose, Morrisons, Pets at Home and M&S whilst mainstream programmes such as Tesco Clubcard, Boots & Nectar are used every week by tens of millions of consumers. These programmes are more or less the same today as they were when Tesco first launched Clubcard over twenty years ago - typically points based, requiring customers to remember to carry a plastic card and swipe it at the till and to carry paper based vouchers which they receive through the post or printed at till. There has been very little take up so far of digital enabling technologies from companies like Mobilize and Eagle Eye which offer significant cost savings to retailers and much greater convenience for customers. At some point this will surely change but the owners of these programmes so far have been highly resistant to change. </div>
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Meanwhile, under the radar and evolving from the world of online affiliate marketing, we are seeing the rapid growth of cashback programmes from Quidco, Top Cashback and, seemingly, just about every bank you can name. What's going on ? </div>
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Well, for customers, cashback market leader Quidco delivers value that is in a different league from that on offer from the supermarket programmes. The average Quidco customer accrues around £70 per year mainly from their online shopping. The most savvy who use Quidco for online, instore and grocery shopping are earning £100's and sometimes £1000's per year. This is because Quidco provides cashback from over 5000 retailers and on average the typical retailer will give around 5% cashback per transaction. Quidco also provide cashback on leading grocery brands. </div>
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For retailers, Quidco provides access to millions of digitally savvy, affluent, high spenders who love to shop and who can be marketed to at a highly granular level based on their detailed shopping habits and reached at a much lower cost than through google. What's not to like about that ? </div>
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With banks its a slightly different story. After many years of silo based, shareholder centric, product and acquisition led marketing they are finally waking up to the benefits of customer centric marketing. Recognising that a surer way to create value for shareholders is to focus on serving existing customers better. A bank's best customers are typically those that are regular current account users as they have a much higher holding of higher margin products such as mortgages, credit cards and insurance. Hence the drive to acquire current account customers and reduce churn. Cashback programmes are emerging as the preferred option given the success being enjoyed by Quidco and others. </div>
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Our hunch is that we are going to witness significant growth and innovation in this space. Mainstream retailers will look to evolve their single brand programmes and offer their customers more choice and higher value. Banks will leverage their data assets to enable retailers to target those customers that matter most. More customers will accrue rewards instore by using their bank cards rather than a separate loyalty cards. Cashback on grocery shopping will grow significantly as fmcg companies continue to invest in direct to consumer marketing and seek to bypass the closed access programmes managed by dunnhumby and Aimia. Speciality retailers, restaurants and service providers will switch marketing funds into those programmes that enable them to attract new, lapsing and loyal customers at low cost. Happy days. </div>
<b></b><i></i><u></u><sub></sub><sup></sup><strike></strike><br />Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com1tag:blogger.com,1999:blog-8679287851873486646.post-44939627414288947622015-10-07T20:34:00.005+01:002015-10-07T20:34:54.140+01:00Has the botched sale of dunnhumby cost Tesco shareholders $1 billion?<div dir="ltr">
Has the botched sale of dunnhumby cost Tesco shareholders $1 billion ? </div>
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Normally if you choose not to sell an income producing asset at least you get the consolation of keeping the income stream. A potential cash windfall is offset by continued and hopefully growing earnings. </div>
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But that won't be the case for Tesco who, according to observer estimates, have given away income of about £50m per year to their former JV partner Kroger. They did this because Kroger had a change of ownership clause which was triggerable if dunnhumby came under new ownership. By negotiating an exit from the Jv and keeping all of the necessary people and technology they require, Kroger are able to continue to benefit from the services that dunnhumby were providing them but without having to pay fees to the UK organisation. As a quid pro quo,Kroger enabled dunnhumby to continue with a small US operation, search for another USA grocery partner and to be sold to a 3rd party. </div>
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The agreement has cost Tesco about £50m per year in reduced income (money that would have flowed to them via the USA JV) as it is highly unlikely that they will be able to find another partner that is willing to pay anywhere near the fees they received from Kroger. This is because Kroger are much bigger than their grocery peers and the other major grocers already have alternative analytics partners who are providing similar services to those provided by dunnhumby. </div>
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The second major clanger dropped during the process has been to redefine the contract term that exists between Tesco and dunnhumby. dunnhumby's profits arise as a consequence of its monopoly rights to use Tesco's Clubcard data. This was an in perpetuity arrangement that would have been attractive to a potential acquirer of dunnhumby but potentially might have constrained Tesco in years to come. So it made sense to put a lengthy contract term in place. By establishing a 5 year agreement, Tesco have thrown the baby out with the bath water, giving an acquirer next to no time to recoup it's investment and hence there are no longer any willing acquirers.</div>
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Consequently there is no sale and dunnhumby is left without its prized USA asset and the source of 60%+ of its profits and value! </div>
Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-12511748178760710052015-08-18T16:09:00.002+01:002016-10-09T23:28:17.678+01:00The Power of Personalisation <span style="font-family: "arial" , "helvetica" , sans-serif;"></span><br />
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<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Most retailers </span><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">would say that if they
could deliver a more personalised service sales would grow. Unfortunately this is easier to say than to do. There are three key reasons for this
:</span><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small; mso-spacerun: yes;"> </span></div>
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Most retailers, other than at an aggregated
level, don’t know who their customers are, their relative importance, the
degree to which they are committed to the retailer’s products or services and
the extent to which they are favourably or unfavourably disposed towards the
brand</span><br />
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<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Even if retailers do know this, changing
something in order to improve things, is difficult </span><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">because employees tend to be
organised around stores, channels or products and services rather than customers</span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Even if the retailer has the necessary insight
and organisation skills, it typically lacks the required technology or fails to
implement it optimally</span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">These three constraints can be overcome as follows : </span><br />
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<b style="mso-bidi-font-weight: normal;"><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">1. Building the
necessary customer insight. </span></b></div>
<span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-size: xx-small;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><br />
<div style="margin: 0in 0in 8pt;">
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">This requires harvesting all available data and crunching it
to get an understanding of customers in 3 dimensions across all channels. The
three dimensions are : </span></div>
<span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-size: xx-small;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><br />
<div style="margin: 0in 0in 0pt;">
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">a) loyalty (how much does the customer spend, how
frequently do they shop)</span></div>
<span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-size: xx-small;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><br />
<div style="margin: 0in 0in 0pt;">
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">b) commitment (what share of the customer’s wallet does
the retailer have) </span></div>
<span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-size: xx-small;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><br />
<div style="margin: 0in 0in 0pt;">
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">c) advocacy (what does the customer think about the
retailer’s proposition and service)</span></div>
<span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-size: xx-small;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><br />
<div style="margin: 0in 0in 0pt;">
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Retailers need a coming together of IT, marketing and data
science skills organised so they can provide both a rear view mirror assessment
of what’s happened and why and guidance to current and potential customer
behaviours and attitudes. </span></div>
<span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-size: xx-small;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><br />
<div style="margin: 0in 0in 8pt;">
<b style="mso-bidi-font-weight: normal;"><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">2. Deploying a customer
centric organisation model or project framework with a senior (ideally CEO)
sponsor who can keep the project on track and help remove road blocks and
barriers. </span></b></div>
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">They key movers need to understand how and why the
organisation makes the decisions it does and what will be necessary to change
them. Getting the right people in the right roles with clarity of purpose, an
holistic view of the organisation and the appropriate governance is key. The
organisation needs to measure outcomes from (individual)</span><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small; mso-spacerun: yes;"> </span><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">customers points of view in order to
understand how attitudes and behaviour impact brand, operational, financial and
service metrics.</span><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small; mso-spacerun: yes;"> </span><br />
<span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-size: xx-small;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><br />
<div style="margin: 0in 0in 8pt;">
<b style="mso-bidi-font-weight: normal;"><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">3. Understanding,
procuring and deploying the right technology </span></b></div>
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Retailers need</span><b style="mso-bidi-font-weight: normal;"><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;"> </span></b><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small; mso-spacerun: yes;"> </span><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">to choose the right type of solution or
service to ensure that results can be delivered quickly within budget and
resource constraints. There is an equal risk of spending too much and taking
too long to deploy as there is in spending too little and going off half baked.
</span><br />
<span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-size: xx-small;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><br />
<div style="margin: 0in 0in 8pt;">
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">The chosen solutions are likely to comprise : </span></div>
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Database software, segmentation and insight
tools to enable customer understanding</span><br />
<ul style="direction: ltr; list-style-type: disc;">
<li style="color: black; font-style: normal; font-weight: normal;"><div style="color: black; font-style: normal; font-weight: normal; margin-bottom: 0pt; margin-top: 0in;">
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Multi channel CRM via app, email, website and
post to deliver personalised communications</span></div>
</li>
<li style="color: black; font-style: normal; font-weight: normal;"><div style="color: black; font-style: normal; font-weight: normal; margin-bottom: 0pt; margin-top: 0in;">
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Web personalisation to ensure the online
experience is appropriately tailored to customer requirements </span></div>
</li>
<li style="color: black; font-style: normal; font-weight: normal;"><div style="color: black; font-style: normal; font-weight: normal; margin-bottom: 0pt; margin-top: 0in;">
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Tools to help stores to deliver layouts,
presentations, experiences, ranges, prices and promotions that are appropriate
to the customers who shop there </span></div>
</li>
<li style="color: black; font-style: normal; font-weight: normal;"><div style="color: black; font-style: normal; font-weight: normal; margin-bottom: 8pt; margin-top: 0in;">
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Programmatic media buying to cost effectively
source new customers </span></div>
</li>
</ul>
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Most companies can point to some examples of a personalised
approach that have yielded positive returns for customers and shareholders but
few would say they do the above consistently well.</span><br />
<span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-size: xx-small;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><br />
<div style="margin: 0in 0in 8pt;">
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small; mso-spacerun: yes;"> </span><b style="mso-bidi-font-weight: normal;"><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Tesco </span></b><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">led the way on personalisation under Sir Terry Leahy but lost
the plot when they began to focus on financial outcomes, ignoring the changes
in customer behaviours and attitudes that heralded their downfall and haven’t
evolved their 20</span><sup><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: small;">th</span></sup><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;"> century loyalty tools for the 21</span><sup><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: small;">st</span></sup><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">
century multi channel and digital world. </span></div>
<b style="mso-bidi-font-weight: normal;"><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Amazon, John Lewis</span></b><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">
and </span><b style="mso-bidi-font-weight: normal;"><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Ebay</span></b><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;"> continue to evolve their online
propositions favourably for customers but still have a way to go to deliver
experiences that are truly personalised.</span><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small; mso-spacerun: yes;">
</span><br />
<span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><span style="font-size: xx-small;"></span><span style="font-family: "arial" , "helvetica" , sans-serif;"></span><br />
<div style="margin: 0in 0in 8pt;">
<b style="mso-bidi-font-weight: normal;"><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Net-a-Porter</span></b><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;"> assign
high value customers a personal shopper and this has been a key reason for
their explosive growth. These personal shoppers understand customer’s size,
colour, style and designer preferences and create outstanding service scores
whilst racking up huge sales commissions. </span><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small; mso-spacerun: yes;"> </span></div>
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;">Tomorrow’s winners will bring the benefits of a personal
shopper to a mass audience and this will require customer centric insight,
decision making and customer centric technology solutions.</span><span style="font-family: "calibri";"><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: xx-small;"> </span></span><br />
<div class="separator" style="clear: both; text-align: center;">
<span style="font-family: "calibri";"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgNfNX1kZfYDR14UwyzFSPrLfAm-56M84cSK8oHY1aPLOcVO3LwyLQfYUZ_9rQWUGb6HrVsM5X1WMJ8ABaovI-pJ1dEhc_o1b9AHngfkSCUfiIJBkulMMMPty6EzTbzp18Q1MTqJHpP5Y5J/s1600/SG-r+collage.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"></a></span></div>
<span style="font-family: "arial" , "helvetica" , sans-serif;"></span><br />
<b></b><i></i><u></u><sub></sub><sup></sup><strike></strike>Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-62698704582108035382015-04-05T12:06:00.000+01:002015-04-05T12:06:09.970+01:00dunnhumby helping GNC to grow LFL sales<div class="News-body-text" style="font-family: arial, helvetica, clean, sans-serif; font-size: 13px; line-height: 16.0030002593994px; margin-bottom: 20px; padding: 0px;">
According to the Tribune-Review GNC, the USA retailer of vitamins and healthcare products, is growing LFL sales following their partnership with dunnhumby. </div>
<div class="News-body-text" style="font-family: arial, helvetica, clean, sans-serif; font-size: 13px; line-height: 16.0030002593994px; margin-bottom: 20px; padding: 0px;">
<span style="line-height: 16.0030002593994px;">GNC has been sending individualized mailings to 1 million of its 7 million Gold Card members a month since September. The company's eight-page mySource catalogs are customized to each member, based on previous buying habits and any demographic data they've collected on the person, including age and gender.</span></div>
<div class="News-body-text" style="font-family: arial, helvetica, clean, sans-serif; font-size: 13px; line-height: 16.0030002593994px; margin-bottom: 20px; padding: 0px;">
<span style="line-height: 16.0030002593994px;">“My standard is that it drove incremental profitability, not just sales, but profitable sales,” CEO Michael Archbold said in a presentation to analysts last month with dunnhumby's Pete Miles-Prouten. “Because the goal here is profitable growth.”</span></div>
<div class="News-body-text" style="font-family: arial, helvetica, clean, sans-serif; font-size: 13px; line-height: 16.0030002593994px; margin-bottom: 20px; padding: 0px;">
<span style="line-height: 16.0030002593994px;">“It was like a snowflake. No one got the same communication,” said Peter Miles-Prouten, senior vice president of consumer markets at dunnhumby.</span></div>
<div class="News-body-text" style="font-family: arial, helvetica, clean, sans-serif; font-size: 13px; line-height: 16.0030002593994px; margin-bottom: 20px; padding: 0px;">
The company declined to provide specific sales and profit numbers related to the campaign.<span style="line-height: 16.0030002593994px;">But in February, GNC reported fourth quarter net income of $51.8 million, up 8.6 percent from the previous year. On a call with analysts to discuss the results, Archbold said sales at stores open at least a year were increasing in the first quarter and expected to be higher for the year. Same-store sales comparisons are an important indicator of a retailer's performance because they don't count the revenue gains from building new stores.</span></div>
<div class="News-body-text" style="font-family: arial, helvetica, clean, sans-serif; font-size: 13px; line-height: 16.0030002593994px; margin-bottom: 20px; padding: 0px;">
In addition to the 1 million mySource mailings a month, GNC is planning to expand the marketing campaign using email.</div>
<div class="News-body-text" style="font-family: arial, helvetica, clean, sans-serif; font-size: 13px; line-height: 16.0030002593994px; margin-bottom: 20px; padding: 0px;">
“We are launching a digital version of this piece, which will be incremental to the printed version, in order to expand the audience receiving it,” Archbold wrote in an email to the Tribune-Review.</div>
<div class="News-body-text" style="font-family: arial, helvetica, clean, sans-serif; font-size: 13px; line-height: 16.0030002593994px; margin-bottom: 20px; padding: 0px;">
“We can't overstate the level of engagement this creates with our customers,” he said. “This provides GNC with the opportunity to match customers with high-quality products to support their unique health, wellness and performance needs.”</div>
<br />Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-5782715095049728882015-03-10T09:18:00.002+00:002015-03-10T09:18:39.000+00:00"Relevant Offers"If I had £1 for every time someone added the word "relevant" in front of the word "offer", I'd be very rich. The usage of the word seems to be in inverse proportion to any understanding of what it might mean. I often ask people what they mean by "relevant" when I hear them say it in conjunction with the word "offer". More often than not they can give no meaningful answer.<br />
<br />
We are being overrun with apps and offer programmes from banks, mobile phone companies and employee benefits providers. All say that their offers are relevant. None of them have defined what they mean by it and engagement in their programmes is very low.<br />
<br />
At dunnhumby when working with Tesco we defined a relevant offer as an offer on a product that a customer had previously bought. If you bought Ariel soap powder then an Ariel offer was relevant but one from Persil was not. So you would only receive the Ariel offer.<br />
<br />
This was consistent with Tesco's view that the the role of Clubcard was to say thank you to customers. Not to try to and get them to buy or try things they didn't already buy.<br />
<br />
To many this seems counter-intuitive. Surely they were just subsidising margin on products customers would have bought already?. But it didn't work like that. One extra item per basket or one incremental shopping trip from the most loyal customers made all the difference.<br />
<br />
At first Tesco's suppliers struggled with this notion. The Ariel brand manager absolutely wanted to target the Persil shoppers, and vice versa. But over time they too realised that a clear definition of relevance - something you have previously bought - was the way to generate the optimum roi on personalised marketing campaigns.Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-28176080952557537432014-08-29T18:38:00.002+01:002014-08-30T09:53:48.824+01:00What to do with Clubcard and dunnhumby ? Dave Lewis, Tesco's new CEO,starts on Monday and amongst the many questions he needs to consider, one will be <b>"What to do with Clubcard and dunnhumby ? "</b><br />
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Clubcard launched in 1995 was a key factor in Tesco's rapid growth through the late 1990's and 2000's. It immediately added lfl sales growth of around 4%-5%, attracted £100's of millions of incremental marketing support from major brands and enabled Tesco to improve site location planning, store ranging, pricing and promotions effectiveness. </div>
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Their long term partnership and subsequent acquisition of dunnhumby, who provide analytics and marketing service support to Tesco, but also their suppliers and other retailers around the world, has created an asset worth £1.5bn</div>
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Nevertheless Clubcard is highly expensive. The key cost is the points. Tesco give away c.1% of sales - c25% of total company profits. In addition there the 100's of million of bits of paper that have to be printed, posted, collected and counted and the incremental staff costs required to man call centres, run the IT systems, distribute rewards and brief the various agency partners. </div>
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c12-14 million shoppers regularly scan their Clubcard and carry it in their wallet or on their key fob. Customers like the little bit extra, the something for nothing that comes from swiping their cards, as well as the personalised offers and the ability to trade points for 2 or 3x their value for a meal out, holiday, family leisure activity or petrol. </div>
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Despite its cost it would be unthinkable to take Clubcard away. The subsequent loss of business would be catastrophic - greatly outweighing any potential cost savings. When Sainsbury's gave up the far less popular Air Miles programme in 2001 they lost 1% lfl overnight.</div>
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Evolving Clubcard is the better option. A number of choices stand out, virtually all of which should have been in place by now. It reflects poorly on the Clubcard team that there has been next to no significant innovation on Clubcard for over 10 years. </div>
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Here are 5 ideas to consider : </div>
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1.<b> Extend the collection opportunities beyond Tesco</b></div>
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Tesco could enable many non competing retailers and service providers to offer Clubcard points to their customers, and could make a tidy profit from doing so. Esso and E-on are a good start but there are many more unrealised collection opportunities particularly on-line. </div>
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2. <b>Make Clubcard a payment vehicle </b> </div>
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Clubcard points are a already medium of exchange but they could evolve into a currency usable to pay for a wide range of products and services. Tesco's ability to validate customer ID, trusted processes to keep data safe and secure and financial services capability, enables them to become a payment service provider to rival Paypal in the UK.</div>
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3. <b>Go Digital </b></div>
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Its a crime against innovation that Tesco still require customers to scan a piece of plastic and to carry and redeem 100s of millions of pieces of paper, when digital coupon redemption has been around for many years. They have made decent progress on the digital redemption of leisure vouchers (eg with Pizza Express), the majority of which are now sent by phone. Progress in their own stores has been virtually non existent. Solutions exist that would enable customers to scan their phone or simply register their debit or credit card in order to have their purchases tracked and points allocated or redeemed without the need for a separate card. Better for customers, simpler for staff, cheaper for Tesco. </div>
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<b>4. Lead the newly emerging market for Personal Data Clouds</b></div>
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Most customers trust Tesco to look after their data and to keep it secure. They understand the implicit contract that comes from swiping a card - "you give me points" - "I tell you about my shopping habits" - "you use that information to send me useful stuff". Tesco could use this trust to navigate the internet to search, qualify and source the information, products, services and offers that would help customers to get more of the things they want more easily and cheaply. PDC's are expected to emerge as a multi £billion market opportunity, Tesco should seek to become market leader </div>
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5. <b>Unleash dunnhumby </b></div>
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Tesco performed better when dunnhumby was at arms length as a semi independent service provider than they have since they owned it outright. They could sell some or all of dunnhumby - particularly the vast majority that serves 3rd party companies - (whilst keeping all that they need to service their own requirements). Generating profits of £70+m with high growth rate and a reputation as a leader in the burgeoning world of "big data" - dunnhumby is likely to attract a valuation north of £1.5bn (almost 10% of Tesco's market capitalisation). Tesco could retain a golden share and key IP whilst allowing dunnhumby to to partner with some combination of a major private equity fund, a global marketing services provider (eg WPP) or global consulting entity to enable it to properly compete as a serious player in the digital and data services space. </div>
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Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-79444620862377158982014-08-18T22:32:00.003+01:002014-08-18T22:32:20.157+01:00Austin Lally's leaving note to P&G colleagues June 2014<div class="MsoNormal">
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<div class="MsoNormal">
<span style="color: #1f497d; font-family: "Calibri","sans-serif"; font-size: 11.0pt;">Austin Lally recently left P&G after more than 25 years to take up a new position as
Group CEO of Verisure Holdings / Securitas Direct AB. </span><span style="color: #1f497d; font-family: Calibri, sans-serif; font-size: 11pt;">Prior
to leaving P&G, he was President of Braun and Appliances and a member of
the Global Leadership Council. He started his career in the UK and also
had assignments in France, Greater China, Germany, Switzerland and the US.
When he left he sent a letter to his P&G colleagues that
tells us a lot about Austin’s character, achievements and many passions
including family, work, music, travel, literature & sport. </span></div>
<br />
<b>Austin's letter to P&G colleagues announcing his retirement </b><br />
<br />
Dear Friends,<br />
Today, we are announcing my retirement from the Procter & Gamble Company. I wanted to take this opportunity to thank you for all of your help and support through the years we worked together.<br />
Looking back, it has been a tremendous experience. More than 25 fulfilling years.<br />
It began in England. In Gosforth, Newcastle upon Tyne. This was a unique place and organisation. I owe so much of my personal development to the lessons and role models from Hedley House. In Guangzhou later, we wanted to build the "Gosforth of the East". I had 8 very happy years in the North-East.<br />
Karen and I went to France in 1997. That was the start of a global adventure that continues today. Paris, Guangzhou, Hong Kong, Frankfurt Geneva, Boston and then a return to Geneva in 2012. All of these places are special to our family. <br />
I am also proud of what our teams achieved for the business.<br />
Building a successful Pampers business in the UK. We went from market shares in the mid-teens to 65 and kept it through the Huggies launch. We delivered on John Bennett’s rallying cry. “Not one single diaper”.<br />
Launching Always in the UK and taking it to leadership, starting with a test market in Carlisle where the stores were perfect because I personally inspected them on Fridays on the way to see Karen who was still studying back in Glasgow.<br />
Some of my most special memories come from the 7 years spent in Greater China. We turned around losing positions in Laundry and Feminine Care, built an outstanding Chinese Marketing organisation and took our Beauty business to new heights. I also managed to pick up a radio show on 102.7 FM and present a prize at the China Music Awards. That was fun. But, most importantly, Karen and I left Greater China with our three daughters Catherine, Rebecca and Abigail, all born on The Peak in Hong Kong in the Matilda Hospital. We also left with many friendships that will last a lifetime. <br />
Developing and mentoring our talent in Asia will always be a source of pride for me. Every single young leader that I worked with from that time left me with a sense of responsibility and an equal amount of optimism. I have been a regular visitor back over the 8 years since. Every trip re-energizes me.<br />
I will always regard myself as part of the P&G China team.<br />
I enjoyed leading the restructuring of DACH in 2006-2007 and helping to lay foundations for the success that Pirjo and her team have driven over the past 7 years. Also, my time in Germany prepared me well to do what was needed on Babycare, Gillette and Braun. It reinforced the importance of facing reality, broadening the portfolio and of trusting the local team with superb execution.<br />
I returned to Babycare to lead Western Europe and 2 of the global Product Lines. We delivered a "three-peat". 3 record years of profit, sales, volume, share and equity growth. I was also proud of our partnership with UNICEF to eliminate neonatal and maternal tetanus around the world. Seeing the program at first hand in a small community in Sierra Leone [with Salma Hayek] showed me the power of a business to make good things happen.<br />
I was able to adopt Boston as my own American city, and became "Gillette Blue", building a stronger innovation pipeline that will benefit us in the years to come. I will also never forget the Bruins lifting the Stanley Cup, and having the chance to ride through Boston on the Duck Bus with the trophy.<br />
Braun has been the final business challenge. Leading the business as President back to growth behind the new OGSM choices and better execution. This fiscal will be the first year of organic volume growth in the past 7 years. We are beating all our top line and bottom line targets. Shares are growing. We are creating value. We defined a winning Braun Business Model and are executing it better each day. The Company has now recognised Braun has a strategic role in our Grooming portfolio, shown in the recent announcements. I'm very proud of the Braun team. The future is bright for them.<br />
Beyond the business, I will miss the organization. I always gained personal energy from recruiting, coaching and developing our young talent. I also saw at firsthand how we perform better when we make our organisations more diverse. In Boston and in Geneva, I was very proud to be an Ally and Executive sponsor of GABLE to help create an inclusive environment where every single employee including LGBT employees can bring all of themselves to work every day.<br />
I have grown in experience over the years and have developed as a leader. But, the essence has remained the same. I believe in rigour, focusing on what really matters, being courageous and unafraid of failure, a passion for winning not taking part, the power of agility, resilience, analytical thinking to get to Why Why, a demand for high standards, authenticity and the responsibility to connect emotionally and to inspire everyone to be their best. The most important are courage and resilience.<br />
One of my favourite poets is Robert Frost. He grew up in Lawrence, New Hampshire. We passed his farm on the way to ski in New Hampshire and Maine when we lived in New England. His poem “ The Road Not Taken” has been an inspiration to me for some time. It is a good metaphor for career choices. “I took the one less travelled by and that has made all the difference”. It is guiding me now. Here’s a recording of Robert reading his own poem.<br />
<a href="http://www.youtube.com/watch?v=ie2Mspukx14">http://www.youtube.com/watch?v=ie2Mspukx14</a><br />
It will be very difficult to leave behind these teams, these friendships and these brands. It has been my life and part of my family for 25 years. In particular, I want to say a special thank you and goodbye to the organisations in China, in Babycare and in Braun.<br />
I'm grateful to the Company for all of these special experiences which allowed me to grow. I was also happy with the positive perspective on future opportunities. But, in the end the decision to retire from the Company at this time came down to family. After so many moves over the years, Karen and I will put education continuity for our three daughters first. To make that a reality, we have made a decision that my short-term and long-term career centre will be in Europe. My aspiration will be to lead European based businesses. I will let you know more about my future plans after P&G as they develop.<br />
I will be cheering you all on in the future. And, if you need any personal advice or counsel, remember you can always reach me on my personal email austinlally@mac.com and on Facebook and LinkedIn.<br />
Finally, let’s go out with attitude. I’m going to be at Caribana all this week. The highlight will be to see The Pixies tonight for the second time this year. Here’s an anthem to sum up the change. “Don’t Look Back Into The Sun” by my favourite band in the past decade, The Libertines.<br />
<a href="http://www.youtube.com/watch?v=jLYsIESNtUc">http://www.youtube.com/watch?v=jLYsIESNtUc</a><br />
Keep well.<br />
AustinSteve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-88198180642405564992014-07-30T10:11:00.003+01:002014-07-30T10:11:49.398+01:00Pets at Home's VIP Club helps sales to grow 4%<div class="standfirst" style="background-color: white; cursor: default; font-family: GriffithGothicLight, arial, sans-serif; font-size: 18px;">
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According to Retail Week, Pets at Home has reported like-for-like growth of 4.1% in its first quarter after building on momentum created by its VIP Club loyalty programme.</div>
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Total revenues grew by 10.4% during the 16 weeks to July 17 to £210.8m with growth driven by new store openings and improving revenues across its food, accessories and services offers.</div>
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Nick Wood, chief executive officer, said: “Our differentiated offering in the pet retail market, an increasingly seamless approach to omni-channel, and growing customer participation and engagement in our VIP loyalty programme continues to drive strong returns.”</div>
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Membership of its VIP Club loyalty programme grew by 400,000 for the 16 weeks to July 17 to take membership to 2.4m members.</div>
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The card is now used during transactions involving 57% of store revenues, up from 52% during the final quarter of its last financial year.</div>
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SG-retail were part of the team that helped to design the loyalty programme. </div>
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Services revenue from its veterinary practices joint venture and Groom Rooms pet grooming salons surged by 27.3% to £18.3m.</div>
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During the quarter Pets at Home opened 10 new stores, 16 new veterinary practices and 19 Groom Rooms, which included 10 veterinary practices and nine Groom Rooms being retrofitted to existing stores.</div>
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In the update, Pets at Home reveals its ‘deliver to store’ service is expected to be fully operational across its entire store portfolio by the end of August.</div>
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Pets at Home also highlighted its return to national TV advertising, which involved clips crowd sourced from its customers.</div>
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<a href="http://www.retail-week.com/topics/marketing/video-pets-at-home-to-unveil-crowdsourced-advert-during-britains-got-talent/5060143.article" style="color: #0a4366; text-decoration: none !important;">The full-length version of the online advertisement has now been viewed over 1.2m times.</a></div>
Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-102610796001535252014-05-18T08:02:00.003+01:002014-05-18T08:02:31.256+01:00How SEO helps Tesco to dominate the online grocery market<span style="font-size: x-small;"><br /></span><div class="main" style="background-color: white; float: left; width: 615px;">
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<span style="font-size: x-small;">Guest article from E-consultancy : </span></div>
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<strong><span style="font-family: Arial, Helvetica, sans-serif;">Tesco is the clear winner in the online grocery market taking 50p of every grocery pound spent shopping on the internet. </span></strong></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">This high share is set to continue not just because of spending on fulfilment, dark stores, distribution, stock and offline marketing but due to its online visibility through organic search and a very visible well-structured website. </span></div>
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<strong style="color: #444444; font-family: Arial, Helvetica, sans-serif; line-height: 1.5em;">The online grocery sector is worth £5.6bn</strong><span style="color: #444444; font-family: Arial, Helvetica, sans-serif; line-height: 1.5em;"> </span><span style="color: #444444; font-family: Arial, Helvetica, sans-serif; line-height: 1.5em;">(compared with the whole of the grocery market being worth £157bn). </span><span style="color: #444444; font-family: Arial, Helvetica, sans-serif; line-height: 1.5em;">. </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif; font-size: small;">Online grocery shopping set to rise</span></h2>
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<span style="font-family: Arial, Helvetica, sans-serif;">The Guardian <a href="http://www.theguardian.com/business/2014/jan/06/supermarkets-open-dark-stores-online-food-shopping-expands" style="color: #0043b3;">recently reported that as much as 15% of UK grocery sales</a>, worth £900m, were online in the four days from 20-23 December, which shows there is a definite appetite for growth.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Together with strong festive purchases, online grocery sales grew 19% last year and are predicted to more than double over the next five years to £13bn (see table below).</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif; line-height: 1.25em;">The big shop is more common online </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">It may seem obvious, but the well planned, 'big shop' happens more frequently online than the quick shop.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">When we spend more at the supermarket we are more likely to do it online. <strong>When we start talking about a £60 plus shop online sales accounts for 12%</strong> (as opposed to the overall 5%) of all checkouts whereas only 1% of checkouts with a value below £60 are purchased online.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Plus the richer we are, the more likely we are to buy online. Those with an annual income of £60,000 or more spent 10p in every pound of their grocery shopping online. </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">To therefore increase the online share of grocery shopping, supermarkets need to make the quick, small shop as much a part of the routine as doing the larger shop online as well as continue with the push for the big-shops. This can be reflected in their SEO. </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif; font-size: small;">How do supermarkets use SEO to increase the little shop online? </span></h2>
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<span style="font-family: Arial, Helvetica, sans-serif;">In Graham's Charlton's post, he stated that</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Not many people will search for 'apples' or 'bread' and then end up doing their shopping at the supermarket which comes out on top.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">This of course is probably true for normal shoppers, (though may not be for bulk buyers such as restaurants, hotels, pubs or other caterers - who will shop for single product bargains).</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">However, we put an index of search terms together made up of all food stuffs and recipe ideas - it came to over 10m searches a month. Surely the supermarkets should be vying for that? </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">It seems that some of the supermarkets are optimising for many, many food terms, and others are not.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Cause or correlation, but the ones that are placed for multiple food terms and recipes are the ones that are doing best online - i.e Tesco. </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif; font-size: small;">Why does Tesco have 50% of the online grocery market? </span></h2>
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<span style="font-family: Arial, Helvetica, sans-serif;">In terms of organic search, that is being found in Google’s search results, Tesco is extremely dominant.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">I've created category specific indexes based on major search terms across the grocery sector eg frozen foods, online shopping, recipe ideas etc. The returning URLs for these keywords in Google’s search results are being tracked every day. </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">As with the industry as a whole, Tesco is light-years ahead of the competition and it is no surprise that it has 50% of the ecommerce grocery market and is doing so well in the online shopping channel as its search positions dominate the sector. </span></div>
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<strong><span style="font-family: Arial, Helvetica, sans-serif;">The example indexes are: </span></strong></div>
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<li style="margin-bottom: 0.37em;"><span style="font-family: Arial, Helvetica, sans-serif;">General supermarket (search terms include: online shopping, groceries etc).</span></li>
<li style="margin-bottom: 0.37em;"><span style="font-family: Arial, Helvetica, sans-serif;">Mother and baby goods (baby milk, nappies etc). </span></li>
<li style="margin-bottom: 0.37em;"><span style="font-family: Arial, Helvetica, sans-serif;">Fresh food and recipes (fresh pasta, fresh fruit, recipe ideas etc). </span></li>
<li style="margin-bottom: 0.37em;"><span style="font-family: Arial, Helvetica, sans-serif;">Food cupboard (large marmite, pancake mix etc). </span></li>
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<span style="font-family: Arial, Helvetica, sans-serif;">Within these groups are around 2,500 search terms with a monthly search traffic, according to Google, of over 10m in the UK.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">This data indicates that Tesco is by far the most visible supermarket. In fact all the other major supermarket brands hardly feature at all outside the general supermarket indexes. (all data from Pi Datametrics). </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif; font-size: small;">Tesco online: owning the quick shop</span></h2>
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<span style="font-family: Arial, Helvetica, sans-serif;"><strong>Table 1. </strong>Category: Food Cupboard</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Google UK Monthly Searches: 2,500,000</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">(All data from pi-datametrics)</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Table 1 shows Tesco’s dominance across over 700 common food terms. As people become more savvy in searching for best deals for their smaller shops, being well placed for the individual products is becoming ever more important for branding and acquisition reasons. Asda and Sainsbury’s are not even in the top ten most visible sites. </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">However what seems to be shown from our data is that a non-traditional UK supermarket, Amazon is making in-roads on the traditional players.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">With well renowned next-day delivery it is Amazon who could start making gains in the small, cheap shop. </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif; font-size: small;">Tesco online: leading the supermarket terms, just</span></h2>
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<span style="font-family: Arial, Helvetica, sans-serif;"><strong>Table 2. </strong>Category: General Supermarket Shopping</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Google UK Monthly Searches: 45,000</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;"><img alt="" height="207" src="https://assets.econsultancy.com/images/0004/7960/general_supermarket_search_terms_google_uk_tesco.png" style="border: 0px; box-shadow: rgb(170, 170, 170) 2px 3px 6px 1px; margin: 0px 1em 1em 0px; max-width: 100%;" width="420" /></span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">In Table 2 we see more of the main supermarkets perform better and compete with Tesco who just about retain first place. Asda and Waitrose are vying for second place in terms of average Google position.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Both those sites have pushed hard in the last 12 months. Sainsbury’s, though visible for all the search terms in this general category, its average position is relative poor and considering the small batch of search terms in this index is not in the conversion zone enough.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Surprisingly two major newspapers, The Guardian and The Daily Mail are visible for these major category searches. Their visibility in Google is extremely dominant across all sectors and are in that sense an online competitor to many brands. </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Below we see the movement between the major supermarket players for these general supermarket terms. We have given supermarkets wieghted points depending on their positions for the major terms in google. </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">It's a three horse race with Asda winning at Christmas, and Tesco just leading now. </span></div>
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<strong><span style="font-family: Arial, Helvetica, sans-serif;">Chart 1: visibility index - supermarket visibility scores across single general grocery index </span></strong></div>
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<span style="font-family: Arial, Helvetica, sans-serif;"><img alt="Supermarket Index from Pi Datametrics Dashboard" height="461" src="https://assets.econsultancy.com/images/resized/0004/7980/supermarket_visibility_index-blog-full.png" style="border: 0px; box-shadow: rgb(170, 170, 170) 2px 3px 6px 1px; margin: 0px 1em 1em 0px; max-width: 100%;" width="615" /></span></div>
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<span style="font-family: Arial, Helvetica, sans-serif; font-size: small;">Tesco online: high visibility in high quantity searches</span></h2>
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<span style="font-family: Arial, Helvetica, sans-serif;"><strong>Table 3. </strong>Category: Fresh Food and Recipes</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Google UK Monthly Searches: 7,500,000</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;"><img alt="" height="199" src="https://assets.econsultancy.com/images/0004/7961/Fresh_food_search_terms_tesco_supermarkets_uk.png" style="border: 0px; box-shadow: rgb(170, 170, 170) 2px 3px 6px 1px; margin: 0px 1em 1em 0px; max-width: 100%;" width="418" /></span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Table 3 represents by far the biggest number of searches by a single category, 7.5m</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Some of these searches are aligned to recipe ideas, hence the high visibility of the BBC, Jamie Oliver's, and Delia Smith’s website.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Offering recipe content onsite is not a strategy lost on the major supermarkets, in fact all the main players offer recipe ideas or content based around fresh food, but it seems the strategy is not being executed as well as possible. </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Sainsbury’s, for example, offers several websites offering such content. In fact, it has at least four domains and a sub-domain that offer recipes: </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;"><img alt="" height="691" src="https://assets.econsultancy.com/images/resized/0004/7859/sainsburys_recipe_sites-blog-full.png" style="border: 0px; box-shadow: rgb(170, 170, 170) 2px 3px 6px 1px; margin: 0px 1em 1em 0px; max-width: 100%;" width="615" /></span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">This spread and dilution of content could therefore be the issue. If the recipes were concentrated in one area then the site could gain more strength and indeed less duplication, thus aiding the user and the search engine.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif; font-size: small;">Tesco online: owning non-supermarket specific retail verticals</span></h2>
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<span style="font-family: Arial, Helvetica, sans-serif;"><strong>Table 4. </strong>Category: Mother and Baby Goods</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Google UK Monthly Searches: 150,000</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;"><img alt="" height="199" src="https://assets.econsultancy.com/images/0004/7962/mother_and_baby_search_terms_supermarket_uk.png" style="border: 0px; box-shadow: rgb(170, 170, 170) 2px 3px 6px 1px; margin: 0px 1em 1em 0px; max-width: 100%;" width="415" /></span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">The most powerful aspect of Tesco is that it reflects the diversity of the large store offering with its online offering. The visibility across non-food searches is as good as it is across the grocery searches above.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">And if this means having presence in front of 150,000 mothers looking for baby products (who may also want to do addtional shopping) then this is well worth the investment. </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">One would have thought that Boots or Mumsnet would have the products and content to have the most powerful websites for their own sector, but no Tesco is supreme in this area too. </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">This performance is replicated across many other areas too including electrical products and online videos, where the purchase of Blinkbox is positioned to compete with Netflix. </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">It is the dominance in the grocery sectors plus its diversity online combined with offline fulfilment that will see Tesco continue with its supremacy for some time to come.</span></div>
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Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-60662421004358172692014-04-29T08:16:00.004+01:002014-04-29T08:16:40.089+01:00The Internet of Things <div style="background-color: #e5e5e5; color: #444444; font-family: 'Helvetica Neue', Arial, Helvetica, Geneva, sans-serif; font-size: 12px; line-height: 18px; margin-bottom: 1.5em;">
Here's an interesting post from IBM on the Internet of Things....</div>
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We live in a connected world, a world with <a href="http://www.v3.co.uk/v3-uk/the-frontline-blog/2129028/hp-predicts-zettabytes-created-2020" style="background-image: none; color: #00528d; outline: none; text-decoration: none;" target="_blank">up to a trillion connected devices</a> in the coming decade. Thanks to IPv6, which enables us to <a href="http://skeptics.stackexchange.com/questions/4508/can-every-grain-of-sand-be-addressed-in-ipv6" style="background-image: none; color: #00528d; outline: none; text-decoration: none;" target="_blank">address every grain of sand in the world</a>, this is likely to increase even more. These connected devices will change our world drastically, and they will generate massive amounts of data. It is projected that <a href="http://idcdocserv.com/1414" style="background-image: none; color: #00528d; outline: none; text-decoration: none;" target="_blank">by 2020, sensor data will create approximately 16-20 zettabytes of data annually</a>. That data can drive a lot of value. In fact,<a href="http://www.zdnet.com/cisco-ceo-internet-of-things-poised-to-be-19-trillion-market-7000026321/" style="background-image: none; color: #00528d; outline: none; text-decoration: none;" target="_blank"> according to Cisco</a>, it is going to be a $19 trillion market within the coming years. The Internet of Things is rapidly taking shape, and we better be ready for the consequences.</div>
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There are many applications within the Internet of Things. What do you think of a smart city, where even garbage generates data? The South Korean city <a href="http://www.bigdata-startups.com/smart-city-future-bring-big-data-level/" style="background-image: none; background-position: initial initial; background-repeat: initial initial; color: #00528d; outline: none; text-decoration: none;" target="_blank">Songdo</a> has been built from the ground up and is completely connected. Songdo, located 40 miles from Seoul, will become a completely connected city where almost any device, building or road will be equipped with wireless sensors or microchips that generate massive amounts of data. In 2016 there will be 65,000 people living in this innovative city, and all the data they and their devices generate will be collected, analyzed and monitored in real-time by the central monitoring hub.</div>
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Songdo is not the only smart city currently being developed. <a href="http://en.wikipedia.org/wiki/Masdar_City" style="background-image: none; background-position: initial initial; background-repeat: initial initial; color: #00528d; outline: none; text-decoration: none;" target="_blank">Masdar City</a> in Abu Dhabi is another example of a truly connected city. The Spanish city <a href="http://www.npr.org/blogs/parallels/2013/06/04/188370672/Sensors-Transform-Old-Spanish-Port-Into-New-Smart-City" style="background-image: none; background-position: initial initial; background-repeat: initial initial; color: #00528d; outline: none; text-decoration: none;" target="_blank">Santander</a> is yet another, as they have buried 12,000 sensors under the asphalt, affixed to street lamps and atop city buses.</div>
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There are many more other examples of devices that are part of the Internet of Things generating a lot of data. From airplane engines that <a href="http://gigaom.com/2010/09/13/sensor-networks-top-social-networks-for-big-data-2/" style="background-image: none; background-position: initial initial; background-repeat: initial initial; color: #00528d; outline: none; text-decoration: none;" target="_blank">generate</a> approximately 2.5 billion terabytes (which equals 2.5 zettabytes) of data each year, to <a href="http://www.bigdata-startups.com/BigData-startup/john-deere-revolutionizing-farming-big-data/" style="background-image: none; background-position: initial initial; background-repeat: initial initial; color: #00528d; outline: none; text-decoration: none;" target="_blank">John Deere</a> equipment, which uses sensor data to control the growing fleet of farming machines and monitor machine optimization, helping farmers make better decisions. Or what about connected bottles of beer that light up to the rhythm of the music during a dance party? For a party during Milan Design week in 2013, <a href="http://files.tribalddb.nl/spark/BLOG%20POSTS/hei_ignite_production_backstorySK%20(2).pdf" style="background-image: none; background-position: initial initial; background-repeat: initial initial; color: #00528d; outline: none; text-decoration: none;" target="_blank">Heineken</a> added sensors to their bottles. They used eight LED lights, an 8-bit microprocessor, an accelerometer, gyroscope and a wireless transmitter with antenna to create connected bottles. Although just a pilot, this is a great example of the endless possibilities of the Internet of Things.</div>
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While the possibilities are endless, a 2013 survey by the American Society for Quality (ASQ) revealed that <a href="http://www.prweb.com/releases/2013/12/prweb11430148.htm" style="background-image: none; background-position: initial initial; background-repeat: initial initial; color: #00528d; outline: none; text-decoration: none;" target="_blank">at the moment, only 13% of the organizations surveyed have adopted the Internet of Things</a> and made (parts of) their factories smart. In those organizations that did develop an Internet of Things strategy and implemented sensors, 82 percent experienced increased efficiency, 49 percent noticed fewer product defects and 45 percent experienced higher customer satisfaction. So the reasons why so many manufacturers have not moved towards the Internet of Things are primarily related to interest, cost and resistance from management, according to the survey.</div>
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So while many examples show the possibilities, still many organizations have not yet moved forward with the Internet of Things. Probably it is just a matter of time before this changes, as the connected world offers many advantages for companies that allow them to improve their products, shorten time-to-market, reduce costs and improve their revenue. </div>
Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-29947315406251349342013-11-17T22:42:00.001+00:002013-11-17T22:42:18.826+00:00Mobilizing your C-suite for big-data analytics - great article from McKinsey <div class="content-header-no-Img noBotBorder" style="border-bottom-width: 0px; clear: both; color: #333333; font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif; font-size: 13px; margin: 0px 0px 25px; min-width: 240px; overflow: auto; padding: 40px 0px 0px;">
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<span style="font-weight: normal;">The attached article is courtesy of McKinsey and resonates very strongly with us. </span><br />
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<span style="color: #333333; font-size: 13px;">Mobilizing your C-suite for big-data analytics</span></h3>
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Leadership-capacity constraints are undermining many companies’ efforts. New management structures, roles, and divisions of labor can all be part of the solution.</h2>
<span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span class="bold" id="rightframe_1_articleDate" style="cursor: default; font-weight: bold; margin: 0px; padding: 0px;">November 2013</span> <span class="pipe" id="rightframe_1_AuthorPipe" style="cursor: default; margin: 0px; padding: 0px 5px;">| by</span><span id="rightframe_1_articleAuthors" style="cursor: default; margin: 0px; padding: 0px;">Brad Brown, David Court, and Paul Willmott</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><strong style="color: #333333; cursor: default; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px; margin: 0px; padding: 0px;">Over the past 30 years,</strong><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"> </span><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">most companies have added new C-level roles in response to changing business environments. The chief financial officer (CFO) role, which didn’t exist at a majority of companies in the mid-1980s, rose to prominence as pressures for value management and more transparent investor relations gained traction.</span><a class="link-footnote" href="http://www.mckinsey.com/Insights/Business_Technology/Mobilizing_your_C_suite_for_big_data_analytics?cid=other-eml-alt-mkq-mck-oth-1311#" rel="#footnote1" style="color: #0065bd; cursor: pointer; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px; margin: 0px; padding: 0px; text-decoration: none;"><sup style="cursor: pointer; font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif; font-size: 0.7em; margin: 0px; padding: 0px; position: relative; top: -0.5em; z-index: 1;">1</sup></a><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"> </span><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Adding a chief marketing officer (CMO) became crucial as new channels and media raised the complexity of brand building and customer engagement. Chief strategy officers (CSOs) joined top teams to help companies address increasingly complex and fast-changing global markets.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Today, the power of data and analytics is profoundly altering the business landscape, and once again companies may need more top-management muscle. Capturing data-related opportunities to improve revenues, boost productivity, and, sometimes, create entirely new businesses puts new demands on companies—requiring not only new talent and investments in information infrastructure but also significant changes in mind-sets and frontline training.</span><a class="link-footnote" href="http://www.mckinsey.com/Insights/Business_Technology/Mobilizing_your_C_suite_for_big_data_analytics?cid=other-eml-alt-mkq-mck-oth-1311#" rel="#footnote2" style="color: #0065bd; cursor: pointer; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px; margin: 0px; padding: 0px; text-decoration: none;"><sup style="cursor: pointer; font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif; font-size: 0.7em; margin: 0px; padding: 0px; position: relative; top: -0.5em; z-index: 1;">2</sup></a><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"> </span><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">It’s becoming apparent that without extra executive horsepower, stoking the momentum of data analytics will be difficult for many organizations.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Because the new horizons available to companies typically span a wide range of functions, including marketing, risk, and operations, the C-suite can evolve in a variety of ways. In some cases, the solution will be to enhance the mandate of the chief information, marketing, strategy, or risk officer. Other companies may need new roles, such as a chief data officer, chief technical officer, or chief analytics officer, to head up centers of analytics excellence. This article seeks to clarify the most important tasks for executives playing those roles and then sets out some critical questions whose answers will inform any reconfiguration of the C-suite. Daunting as it may seem to rethink top-management roles and responsibilities, failing to do so, given the cross-cutting nature of many data-related opportunities, could well mean jeopardizing top- or bottom-line growth and opening the door to new competitors.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;">Six top-team tasks behind data analytics</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Crafting and implementing a big-data and advanced-analytics strategy demands much more than serving up data to an external provider to mine for hidden trends. Rather, it’s about effecting widespread change in the way a company does its day-to-day business. The often-transformative nature of that change places serious demands on the top team. There’s no substitute for experienced hands who can apply institutional knowledge, navigate organizational hazards, make tough trade-offs, provide authority when decision rights conflict, and signal that the leadership is committed to a new analytics culture. In our experience, the concerted action that’s required falls into six categories. Leaders should take full measure of them before assigning responsibilities or creating roles.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;">Establishing new mind-sets</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Senior teams embarking on this journey need both to acquire a knowledge of data analytics so they can understand what’s rapidly becoming feasible and to embrace the idea that data should be core to their business. Only when that top-level perspective is in place can durable behavioral changes radiate through the organization. An important question to ask at the outset is “Where could data analytics deliver quantum leaps in performance?” This exercise should take place within each significant business unit and functional organization and be led by a senior executive with the influence and authority to inspire action.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Leaders at one large transportation company asked its chief strategy officer to take charge of data analytics. To stretch the thinking and boost the knowledge of top managers, the CSO arranged visits to big data-savvy companies. Then he asked each business unit to build data-analytics priorities into its strategic plan for the coming year. That process created a high-profile milestone related to setting real business goals and captured the attention of the business units’ executives. Before long, they were openly sharing and exploring ideas and probing for new analytics opportunities—all of which helped energize their organizations.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;">Defining a data-analytics strategy</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Like any new business opportunity, data analytics will underdeliver on its potential without a clear strategy and well-articulated initiatives and benchmarks for success. Many companies falter in this area, either because no one on the top team is explicitly charged with drafting a plan or because there isn’t enough discussion or time devoted to getting alignment on priorities. At one telecommunications company, the CEO was keen to move ahead with data analytics, particularly to improve insights into customer retention and pricing. Although the company moved with alacrity to hire a senior analytics leader, the effort stalled just as quickly. To be sure, the analytics team did its part, diving into modeling and analysis. However, business-unit colleagues were slow to train their midlevel managers in how to use the new models: they didn’t see the potential, which, frankly, wasn’t part of “their” strategic priorities.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">As we have argued previously,</span><a class="link-footnote" href="http://www.mckinsey.com/Insights/Business_Technology/Mobilizing_your_C_suite_for_big_data_analytics?cid=other-eml-alt-mkq-mck-oth-1311#" rel="#footnote3" style="color: #0065bd; cursor: pointer; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px; margin: 0px; padding: 0px; text-decoration: none;"><sup style="cursor: pointer; font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif; font-size: 0.7em; margin: 0px; padding: 0px; position: relative; top: -0.5em; z-index: 1;">3</sup></a><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"> </span><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">capturing the potential of data analytics requires a clear plan that establishes priorities and well-defined pathways to business results, much as the familiar strategic-planning process does. Developing that plan requires leadership. At a North American consumer company, the CEO asked the head of online and digital operations, an executive with deep data knowledge, to create the company’s plan. The CEO further insisted that it be created in partnership with a business-unit leader who was not familiar with big data. This partnership—combining a data and analytics expert and an experienced frontline change operator— ensured that the analytics goals outlined in the plan were focused on actual, high-impact business decisions. Moreover, after these executives shared their progress with top-team counterparts, their collaborative model became a blueprint for the planning efforts of other business units.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;">Determining what to build, purchase, borrow, or rent</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Another cluster of decisions that call for the authority and experience of a senior leader involves the assembly of data and the construction of advanced-analytics models and tools designed to improve performance. The resource demands often are considerable. With multitudes of external vendors now able to provide core data, models, and tools, top-management experience is needed to work through “build versus buy” trade-offs. Do strategic imperatives and expected performance improvements justify the in-house development and ownership of fully customized intellectual property in analytics? Or is reaching scale quickly so important that the experience and talent of vendors should be brought to bear? The creation of powerful data assets also can require the participation of senior leadership. Locking in access to valuable external data, for instance, may depend on forging high-level partnerships with customers, suppliers, or other players along the value chain.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">The radically diverging paths different retailers have chosen underscore the range of options leaders must weigh. Several retailers and analytics firms have established long-term contracts covering a broad sweep of analytics needs. Other large players, both brick-and-mortar and online, have invested in deep internal data and analytics expertise. Each of these choices reflects a dynamic set of strategic, financial, and organizational requirements that shouldn’t be left to middle management.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;">Securing analytics expertise</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Under almost any strategic scenario, organizations will need more analytics experts who can thrive amid rapid change. The data-analytics game today is played on an open and (frequently) cloud-based infrastructure that makes it possible to combine new external and internal data readily and in user-friendly fashion. The new environment also requires management skills to engage growing numbers of deep statistical experts who create the predictive or optimization models that will underwrite growth.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">The hunt for such talent is taking place in what has become the world’s hottest market for advanced skills. Retaining these valued employees and then getting them to connect with business leaders to make a real difference is a true top-management task—one that often demands creative solutions. The leader of a big-data campaign at a major consumer company, for instance, decided to invest in an analytics unit distant from company headquarters. This other locale had abundant talent and a cultural environment preferred by data scientists and engineers. The leader then closed the loop, ensuring that each unit of the analytics team had a direct connection to a business-unit team at the company.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;">Mobilizing resources</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Companies often are surprised by the arduous management effort involved in mobilizing human and capital resources across many functions and businesses to create new decision-support tools and help frontline managers exploit advanced analytics models. An empowered senior player is vital to breaking down the institutional barriers that frequently hamper efforts to supercharge decisions through data analytics. Success requires getting a diverse group of managers to coalesce around change—encouraging alignment across a wide phalanx of IT, business-lines, analytics, and training experts. The possibility of failure is high when companies don’t commit leadership.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Take the example of a second transportation company, where middle managers across product areas were tasked with identifying data-analytics opportunities and then pushing them forward. The analytics managers were routinely frustrated when data teams failed to deliver data on schedule or in usable formats. When it came time to embed the resulting analytics into customized tools, managers faced additional frustrations as urgent requests worked their way through routine budgeting and planning processes. The company gave the task of stepping up the pace of its analytics agenda to a top marketing and sales executive, who assembled cross-functional teams including database managers, analysts, and software programmers. The teams rotated across analytics opportunities, steering them from launch to implementation in six- to eight-week bursts. Through this rapid mobilization, the company checked off several analytics priorities only months after the marketing leader took charge.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;">Building frontline capabilities</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">The sophisticated analytics solutions that statisticians and scientists devise must be embedded in frontline tools so simple and engaging that managers and frontline employees will be eager to use them daily. The scale and scope of this adoption effort—which must also involve formal training, on-the-job coaching, and metrics that clearly define progress—shouldn’t be downplayed. In our experience, many companies spend 90 percent of their investment on building models and only 10 percent on frontline usage, when, in fact, closer to half of the analytics investment should go to the front lines.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Here, again, we have seen plenty of cases where no one on the top team assumed responsibility for sustained ground-level change. Lacking senior accountability and engagement, one financial-services company weathered several waves of analytics investment and interest only to have efforts fizzle when training and adoption fell short. Dismayed, business-unit leaders then took charge, investing in ongoing training sessions for managers and end users, pushing for the constant refinement of analytics tools, and tracking tool usage with new metrics. Over time, thanks to the consistent application of analytics, the transformation effort gained the hoped-for momentum.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;">Putting leadership capacity where it’s needed</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">As companies size up these challenges, most will concede that they need to add executive capacity. But that leaves unanswered important decisions about where, exactly, new roles will be located and how new lines of authority will be drawn. As we’ll outline below, our experience shows that companies can make a strong case for leading their data-analytics strategies and talent centrally or even for establishing a formal data-analytics center of excellence. However, frontline activities (mobilizing resources, building capabilities) will need to take place at the business-unit or functional level, for two reasons. First, the priorities for using data analytics to increase revenues and productivity will differ by business. Second, and just as important, companies best catalyze frontline change when they connect it with core operations and management priorities and reinforce it with clear metrics and targets.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Beyond this bias for pushing frontline mobilization responsibility to business units, there is no single prescription for where and how a company should add leadership capacity. Given the relative immaturity of data-analytics applications, that shouldn’t be surprising. Yet as leaders review their options, they needn’t fly blind. Pushing for answers to three key questions, in our experience, brings strategic clarity to the needed organizational changes:</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Will a central customer or operational database be used across business units?</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Is there a compelling need to build substantial analytics resources internally to retain talent and build proprietary assets and advantages?</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Within each business unit, can the current functional executives handle the change-management challenge or should the company dedicate new executive capacity specifically for the data-analytics change effort?</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">We’ll illustrate the importance of these issues through examples of companies that have addressed them in different ways.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;">When central data assets are key</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">At many consumer-services businesses, exploiting analytics involves combining transaction data across a number of businesses or channels. That approach allows these companies to shape insights such as how consumers engage with Web sites or decide between shopping online or in stores. These companies often have (or are building) new central data warehouses or data environments, as well as related data-management capabilities. In addition, they often are working through new rules of the road on issues such as how they can access data while protecting consumer privacy or ensure that key customers aren’t hassled by unnecessary contacts.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">In such cases, an enhanced role for the CIO—spearheading the development of the data-analytics strategy and talent building—is a popular path. Operationally, the CIO takes charge of efforts to develop the data and analytics infrastructure while letting the business units mobilize change aimed at exploiting it.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">At one multibusiness consumer-services company, for instance, the board and senior-leadership team recognized that a significant step-up in performance could be achieved if it fully exploited analytics opportunities across business lines by harnessing its multichannel databases. Recognizing the overarching role that the central databases play in the company’s agenda, the leadership designated the chief information officer to direct the effort and to define the data and analytics strategy.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">The leaders realized that each business unit, by necessity, would have its own targeted analytic priorities, such as strengthening promotional offers or optimizing inventory levels. Moreover, a different group of managers would be applying the insights across business units. The leadership concluded that under these circumstances, managing analysis and frontline training from the center would be a mistake and decided instead that the CIO should partner with business-unit leaders, sharing with them a tiered set of responsibilities.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">At present, the CIO is immersed in two key projects. The first is creating a new infrastructure that unites the company’s multichannel transaction data with external social-media and competitive information and delivers the result to business units through an intuitive interface. The second involves building up analytics expertise that can be assigned to different business units but managed centrally, at least for the next couple of years as the effort gains critical mass. The analytics team is led by a deeply experienced executive who reports to the CIO and provides a crucial injection of top-management capacity. In parallel, business-unit leaders are hammering out analytics priorities and building the skills of frontline managers who will use new models to, for example, redirect spending across media channels.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;">When substantial internal analytics expertise is core to performance</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">We are also seeing a second approach, which shares some of the centralized aspects we touched on above but specifically involves companies that decide to build rather than outsource a critical body of advanced analytics expertise. That decision often leads organizations to locate the expertise centrally, where it serves as a common platform for creating value across business units.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">At one consumer-facing company, analytics expertise and leadership were concentrated in the finance and risk-management team, which historically had accounted for significant data-related value creation. When the company began pursuing a more aggressive analytics strategy, the CFO took responsibility for several tasks, including defining the basic strategy, overseeing make-versus-buy decisions for the core risk-management analytics tools, mobilizing resources within the function’s analytics team, and building expertise.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">However, having made these primary decisions about analytics, the CEO and CFO soon realized that significant complementary efforts were needed to secure better data for the analytics team and to reinforce change efforts and revamp several processes across the business units. To lead these initiatives, they established a new position—chief data officer—within the CFO’s organization. This CDO proactively manages information, working with business managers to identify both internal and external data they may not even realize exists. Delivered ready for analysis, the data can be applied rapidly to needed tasks by modeling experts and, just as important, continually refreshed for new experiments and broader application. Many companies may find they need this type of leadership to support business leaders as they identify sources of data-driven advantages, work through analytics priorities, and try to accelerate frontline adoption.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: black; font-size: 1.231em; line-height: 1.25em;">When managing scale and complexity within business units is paramount</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Whether elements of the effort are managed centrally or not, much of the data-analytics heavy lifting will fall on business or functional leaders within individual business units. A core question at the business-unit level is whether to add a new role or ask a key functional leader (such as the CMO or the head of operations) to add new responsibilities to what in all likelihood is already a pretty full plate.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">When the senior leaders of a large financial-services company took a wide-ranging look at its strategy, they decided that one business unit could gain a significant competitive edge if it doubled down on data analytics. To push the strategy ahead decisively, the company recruited a chief analytics officer, who reports to the business-line president and oversees a new center of excellence drawing on internal consultants, analytics modelers, and software programmers.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">This approach, which represents a significant organizational change, is accelerating the business unit’s data-transformation effort. As a top-team member, the CAO can drive a broad range of decisions, from setting analytics strategy to defining the responsibilities of frontline managers. Since the center of excellence spans multiple disciplines, the CAO can mobilize analytics and software-programming resources swiftly, which has sped up the creation of frontline tools. Meantime, operating from within the business unit has given him a deeper understanding of what makes it tick—its priorities, patterns of working, and ongoing challenges. This has paid off in sharper decisions about which tools to develop and a keener sense of the skills that training programs need to foster. The fact that the business unit’s leaders are engaged with the CAO on a day-to-day basis helps keep them focused on their analytics and adoption agendas.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">Building on this success, the company has recently taken the further step of adding another new role, a chief data officer, who reports to the CIO but works daily with the chief analytics officer to help knit together data and new analytics tools and to speed frontline change.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">For companies pursuing the potential of data analytics, a decision about leadership capacity looms—regardless of where in the end they decide to place it. For some, such as the consumer-facing companies described earlier, current top-team members will be asked to step up and assume broader leadership responsibilities, often with additional support from new, senior lieutenants. For others, such as the financial-services company we explored, establishing one or more new senior posts to drive the analytics agenda will be the best solution.</span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;"><br /></span></span><span class="silverNote small" style="color: #939d98; cursor: default; display: block; font-size: 0.846em; line-height: 14px; margin: 0px 0px 4px; padding: 0px;"><span style="color: #333333; font-family: Georgia, 'Times New Roman', serif; font-size: 13px; line-height: 17px;">At all companies, top teams, and probably board members as well, need a better understanding of the scale of what’s needed to ensure data-analytics success. Then they must notch these responsibilities against their existing management capacity in a way that’s sensitive to the organization’s core sources of value and that meshes with existing structures. None of this is easy, but it’s the only serious way to pursue data analytics as a new frontier for growth.</span></span></div>
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About the authors</h6>
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<strong style="cursor: default; margin: 0px; padding: 0px;">Brad Brown</strong> is a director in McKinsey’s New York office, <strong style="cursor: default; margin: 0px; padding: 0px;">David Court</strong> is a director in the Dallas office, and <strong style="cursor: default; margin: 0px; padding: 0px;">Paul Willmott</strong> is a director in the London office.</div>
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The authors would like to acknowledge the contributions of Matthew Ariker, Amit Garg, Joshua Goff, Lori Sherer, and Isaac Townsend to the development of this article.</div>
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Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com2tag:blogger.com,1999:blog-8679287851873486646.post-4423288051161599072013-10-04T11:05:00.001+01:002014-01-12T17:08:37.589+00:00How TfL uses big data to personalise its marketing campaigns<div style="background-color: white; color: #444444; line-height: 27.828125px; margin-bottom: 1.5em;">
<strong><span style="font-family: Arial, Helvetica, sans-serif;">How TfL uses big data to personalise its marketing campaigns</span></strong></div>
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<strong><span style="font-family: Arial, Helvetica, sans-serif;">Transport for London has the gargantuan task of carrying more than 1bn passengers each year, which means that the marketing team has an equally difficult job of keeping them all informed about upgrades and delays.</span></strong></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">To find out more about TfL's marketing strategy and exactly what it does with all that Oyster Card data, e-consultancy (www.econsultancy.com) recently spoke to Head of Marketing Services Julie Dixon.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif; line-height: 1.25em;">What are the main marketing aims for TfL, as presumably it’s not about brand awareness?</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">The role of TfL is to keep London working, growing and to make life in London better – which is a pretty big task!</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Put more simply we want to get people from A to B as quickly, safely and efficiently as possible, providing them the information they need to make their journey in the way they want to get it. Virtually every resident, worker or visitor to London is one of our customers.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">This includes people using the public transport services that we operate and road users, as many people don’t realise that TfL has responsibility for the majority of the major roads in London too.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif; font-size: small;">
What are the main challenges you faced with the increased amount of data available to modern marketers?</span></h2>
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<span style="font-family: Arial, Helvetica, sans-serif;">The sheer scale of the data available to us, where we have millions of journeys being made everyday on TfL services and roads, and how we can then best use this data to help our customers. As just one example, when a customer has registered their email address with us, we can directly contact them with travel information that relates to them.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">With the majority of Oyster customers however we only have volume data, which is not personalised, but can tell us for example how many people are going in and out of Canary Wharf station.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif; font-size: small;">
And conversely, how has the increased availability of customer data benefited marketing professionals and TfL specifically?</span></h2>
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<span style="font-family: Arial, Helvetica, sans-serif;">Yes, it has certainly helped us at TfL. We have around 4.5 million customer email addresses and we can use this to great effect to contact our customers on service related messages.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">We can tell them about a new service or change in timetable, through to messages about known disruption, for example when London hosts a major sporting event that might have an impact on the roads, and events such as the Baroness Thatcher funeral, where <strong>we were able to email customers about the specific bus route that they regularly use and how it would be affected.</strong></span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">But with this amount of data <strong>we have to use it carefully and ensure that we are only contacting our customers with relevant and timely information.</strong></span></div>
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How advanced is your use of customer data and to what extent are you able to personalise digital marketing messages?</span></h2>
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<span style="font-family: Arial, Helvetica, sans-serif;">We are building this into our future digital strategy. <strong>The new TfL website, which is currently in beta mode, will allow customers even more personalisation</strong> by remembering previous journeys searched, saving frequent journeys, providing information through geo-location about what is going around them and feeding them information about unplanned disruptions that is tailored to where they currently are and where they want to get to.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">We will also be providing options for personalising this information that might take into account, for example, the accessibility needs of the customer.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif; font-size: small;">
Is the marketing team given access to Oyster Card data, and if so how do you use it?</span></h2>
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<span style="font-family: Arial, Helvetica, sans-serif;">We can access Oyster data for the general movement of people around London and using our services, but this is not </span><img alt="" src="http://assets.econsultancy.com/images/resized/0003/8300/article-1043118-023bb8f600000578-554_233x238-blog-third.jpg" height="204" style="border: 0px; box-shadow: rgb(170, 170, 170) 2px 3px 6px 1px; float: right; margin: 0px 1em 1em 0px; max-width: 100%;" width="200" /><span style="font-family: Arial, Helvetica, sans-serif;">personalised data. As mentioned we do have the email address for people that have registered their Oyster cards. We used this to great effect during the London 2012 Games.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">For example, we were able to take the LOGOC data that told us how many people would be going to a venue on any one day including different start times for events/ticket holders, overlay that data with the normal number of customers we see on a particular line or at a particular station, then overlay with the transport capacity on the line or station – <strong>we could then predict how busy a station would be and how long a customer might have to wait to board a train.</strong></span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">From that we could develop highly targeted messages on a day-by-day, hour-by-hour, line-by-line, and station-by-station basis.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">We then ran station campaigns through posters and emails, telling people how busy their regular station would be during the Games and encouraging them to try alternative routes, or travel at a different time of day. <strong>We aimed to get 30% of Londoners to change the way they travelled, we achieved a 35% change. </strong></span></div>
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<span style="font-family: Arial, Helvetica, sans-serif; font-size: small;">
How do you plan to develop the company’s marketing strategy using data in the next few years?</span></h2>
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<span style="font-family: Arial, Helvetica, sans-serif;">We know from talking to our customers that they increasingly demand information that is relevant and personalised to them, and that they want get this information in the place and way that they want it. So our future aims for use of data will be to give our customers just this.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">They want to know, for example, what is happening at the particular station or bus stop that they are using at that moment. They are not interested so much in what is happening at the other end of the tube line.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">So the challenge is how to do that by maximising our use of digital channels. <strong>We have over 600,000 Twitter followers, who can follow the Tube lines that they use</strong>. However some customer still want to have printed static information at stations and we know that they use a combination of both when travelling.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif; font-size: small;">
What is your opinion of ‘big data’? Is it a meaningful term or just a buzzword?</span></h2>
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<span style="font-family: Arial, Helvetica, sans-serif;">Big data is not a new phenomenon it is just that we now have the technology to interrogate the data more than ever and to mash up this data to give us a different perspective on it, as we did when planning for the London 2012 Games.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;"><strong>It can also tell us if we have achieved our marketing outcomes.</strong> For example for major events, do our messages about how to get to events cut through and did people change and follow our advice – did we influence travel behaviours.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif; font-size: small;">
How do you try to take advantage of your most popular web pages to achieve your marketing aims?</span></h2>
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<span style="font-family: Arial, Helvetica, sans-serif;">From knowing which pages customers visit to look for information, we can target our digital advertising to reach them at the right moment. They are far more likely to continue using our information if it is relevant to what they are doing at that particular time.</span></div>
<div style="background-color: white; color: #444444; line-height: 27.828125px; margin-bottom: 1.5em;">
<span style="font-family: Arial, Helvetica, sans-serif;">The TfL website is one of the most visited sites in London and we will use our homepage if we have significant information that we need to convey to our customers.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Also as mentioned we are looking at how we can create a more personalised experience for customers when using our website, so that it can tailor the information they request to their own particular needs</span></div>
Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-39723680299799650532013-09-28T16:35:00.001+01:002013-09-28T17:11:29.769+01:00dunnhumby vs emnos (Tesco/Kroger vs American Express)<div class="yui-g" style="background-color: white; margin: 0px; padding: 0px; zoom: 1;">
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<span style="color: #445878; font-family: Arial, Helvetica, sans-serif; font-size: small;">dunnhumby USA are suing emnos USA for patent infringement of their "Shop" analytical tool. dunnhumby have filed a lawsuit </span><span style="font-size: xx-small;"><span style="color: #445878; font-family: Arial, Helvetica, sans-serif;">( </span><span style="color: #6d6d6d; font-family: verdana;">Civil Action No.</span><span style="color: #6d6d6d; font-family: verdana;"> </span><a class="case-minutae" href="https://ecf.ilnd.uscourts.gov/cgi-bin/qrySummary.pl?278980" style="color: #6d6d6d; font-family: verdana;">1:13-cv-00399</a><span style="color: #6d6d6d; font-family: verdana;">;) </span><span style="color: #6d6d6d; font-family: verdana;">in the</span><span style="color: #6d6d6d; font-family: verdana;"> </span><a class="case-minutae" href="http://www.ilnd.uscourts.gov/" style="color: #6d6d6d; font-family: verdana;">U.S. District Court for the Northern District of Illinois</a></span><span style="color: #6d6d6d; font-family: verdana;"><span style="font-size: 14px;"> </span><span style="font-size: x-small;">although the case is yet to be heard.</span><span style="font-size: 14px;"> </span></span></h1>
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<span style="color: #6d6d6d; font-family: verdana;"><span style="font-size: 14px;">There's a lot of interest in the outcome not least as it pits two of the world's leading retailers (Tesco and Kroger - co-owners of dunnhumby USA) against American Express (owners of emnos).</span></span></div>
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<span style="color: #6d6d6d; font-family: verdana;"><span style="font-size: 14px;">dunnhumby's "Shop" enables subscribers to analyze a retailer's customer data - ie their epos sales data linked to a unique customer ID - via a web based portal.</span></span></div>
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<span style="color: #6d6d6d; font-family: verdana;"><span style="font-size: 14px;">The patent was granted in 2004 following the launch of The Shop to Kroger and their suppliers around the same time. "The Shop" was developed by dunnhumby UK ltd in 2001 as a way of automating the delivery of analysis to Tesco's suppliers following the launch of dunnhumby Retail in the same year. dunnhumby Retail was a new division which was set up and led by Steve Gray to enable dunnhumby to provide marketing services derived from Tesco's Clubcard data to Tesco's suppliers. </span></span></div>
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<span style="color: #6d6d6d; font-family: verdana;"><span style="font-size: 14px;">In return for enabling dunnhumby to provide these services on an exclusive basis, Tesco took a 53% stake in dunnhumby which at the time had sales of £10m and profits of £0.5m. </span></span></div>
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<span style="color: #6d6d6d; font-family: verdana;"><span style="font-size: 14px;">"The Shop" became a "must have" tool for Tesco's suppliers, enabling them to understand what types of shoppers were buying their products, in what store formats, at what frequency and with what other products. The tool was used to improve marketing, promotional and NPD activity and to identify opportunities for personalised marketing via Tesco's Clubcard media platform. No other research tool provided the same level of granular insights and the ability to accurately track and measure the impact of retail media over such a wide user base. </span></span></div>
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<span style="color: #6d6d6d; font-family: verdana;"><span style="font-size: 14px;">The use of Clubcard insights, linked to personalised marketing activity proved transformational for Tesco and over the next 10 years their share of the UK grew from around 20% to around 30%. Tesco's CEO, Sir Terry Leahy, has described Clubcard, which was launched in 1995, as the smartest idea he ever had "It transformed the prospects for Tesco and introduced a new way of managing our relationship with customers" (Market Leader Q4 2013). </span></span></div>
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<span style="color: #6d6d6d; font-family: verdana;"><span style="font-size: 14px;">Similarly for dunnhumby. Tesco represented 40% of dunnhumby's £10m billings in 2001 but the deal to open up Clubcard data to suppliers enabled dunnhumby to grow sales to £65m and make profits of £13m by 2006. dunnhumby's founders sold an additional 30% of their shares to Tesco that year giving Tesco 83% of the equity. </span></span></div>
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<span style="color: #6d6d6d; font-family: verdana;"><span style="font-size: 14px; line-height: 16px;">The business model that had been developed with Tesco and their suppliers in the UK was replicated by dunnhumby with Kroger, the USA's second biggest grocery chain, following the creation of dunnhumby USA (50% owned by dunnhumby UK Ltd and 50% owned by Kroger). The decision by the Kroger CEO, Dave Dillon, to bet the company on their "customer first" strategy also proved transformational for Kroger. At a time when many in the industry expected them to be crushed by Wal*Mart, Kroger's smart use of customer data enabled them to make better pricing, promotional and ranging decisions, understanding where expenditure was being wasted and re-targeting it on price sensitive products bought by price sensitive shoppers, optimising ranging and layouts and replicating Tesco's successful personalised marketing activity. Consequently Kroger have consistently grown sales, market share and their enterprise value. Dillon who became CEO in 2003 doubled Kroger's sales in the subsequent decade and attributes much of his success to dunnhumby. </span></span><span style="color: #6d6d6d; font-family: verdana; font-size: 14px; line-height: 16px;">“dunnhumby has helped me reset my understanding of what the customer is </span><span style="color: #6d6d6d; font-family: verdana; font-size: 14px; line-height: 16px;">after, and it helps replace intuition with actual data and actual facts. And it’s </span><span style="color: #6d6d6d; font-family: verdana; font-size: 14px; line-height: 16px;">those facts that are driving our decision-making.” - David B. Dillon, Chairman and Chief Executive Officer (quoted on the dunnhumby website). </span><br />
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<span style="color: #6d6d6d; font-family: verdana; font-size: 14px; line-height: 16px;">Dave Dillon and his leadership team went to great lengths to ensure that their suppliers used dunnhumby's tools, coupons and processes and this created a profits bonanza for dunnhumby USA who were able to charge c. 4-5x the pricing realisable in the UK as a consequence of the market size, </span><span style="color: #6d6d6d; font-family: verdana; font-size: 14px; line-height: 16px;">Kroger's share within it and the size of its active customer base. </span></div>
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<span style="color: #6d6d6d; font-family: verdana; font-size: 14px; line-height: 16px;">The profits enabled Kroger not only to cover all of the costs of the rapidly growing number of consultants and data scientists recruited into dunnhumby USA but to generate a significant surplus. </span><br />
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<span style="color: #6d6d6d; font-family: verdana; font-size: 14px; line-height: 16px;">50% of the profits meanwhile flowed back to dunnhumby UK Ltd and in addition they also recouped £ millions in IP and licencing fees payable into dunnhumby USA by Kroger and its suppliers. </span><span style="color: #6d6d6d; font-family: verdana; font-size: 14px; line-height: 16px;">Tesco acquired the remaining 17% of dunnhumby shares in 2011 in order to own it outright and dunnhumby n</span><span style="color: #6d6d6d; font-family: verdana; font-size: 14px; line-height: 16px;">ow delivers c.£70million of profits for Tesco - worth an estimated £1.5bn - should Tesco ever choose to monetise their ownership. </span></div>
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<span style="color: #6d6d6d; font-family: verdana; font-size: 14px; line-height: 16px;">Along the way there have been a number of spin offs from dunnhumby. The first of which, 5One, gave birth to emnos. </span></div>
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<span style="color: #6d6d6d; font-family: verdana;"><span style="font-size: 14px; line-height: 16px;">emnos began life as 5One Germany - a JV with Loyalty Partner gmbh and 5One UK Ltd formed in 2004 but disbanded within a year. The founders of 50ne decided to focus on the UK and South African markets and the 5One Germany team rechristened themselves as "emnos" (taken from a hybrid of the latin words for shopper, emptor, and to know, noscere) and merging with the in house analytics team of PAYBACK gmbh (owners and operators of Europe's largest and most successful coalition loyalty programme). </span></span></div>
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<span style="color: #6d6d6d; font-family: verdana; font-size: 14px; line-height: 16px;">emnos followed a similar business model to dunnhumby partnering with amongst others Metro Group, Carrefour, Boots, Morrisons, Waitrose, Co-op, Woolworths Australia, Target and Walgreens. Interestingly </span><span style="color: #6d6d6d; font-family: verdana; font-size: 14px; line-height: 16px;">emnos tried to buy 5One in 2007 but were outbid by BNP Paribas owned Laser.</span></div>
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<span style="color: #6d6d6d; font-family: verdana; font-size: 14px; line-height: 16px;">emnos developed a look a like version of "The Shop" which is branded "Analyzer" in 2007 </span><span style="color: #6d6d6d; font-family: verdana; font-size: 14px; line-height: 16px;">using a different underlying architecture and introducing a number of new features. They developed the tool working with Carrefour, although Carrefour did not own any IP and never showed the same enthusiasm for customer data led decision making as Tesco or Kroger. emnos entered the USA market in 2008 working with Target and subsequently Walgreens. </span></div>
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<span style="color: #6d6d6d; font-family: verdana; font-size: 14px; line-height: 16px;">emnos, PAYBACK and their holding company Loyalty Partner gmbh were sold to American Express for $660m in 2011 which makes the patent dispute more interesting as in effect it pits Tesco and Kroger against American Express. </span></div>
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Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-31660159825211406652013-09-16T22:18:00.002+01:002013-09-18T09:29:17.821+01:00Towards a better world of "small data" insights...We've met a variety of senior figures from a number of the UK's leading e-commerce businesses in the last few weeks. We wanted to talk about "big data" analytics and how we might create richer insight and hence more personalised customer experiences. We expected that most site owners would have the tools to be able to translate this insight into personalised content and that they would be sat on a mountain of "small data", ie data attributable to an individual prospect or customer - either by name or behaviour - piled high into a "big data" stack for us to crunch. What a shock to find this was not the case. Most e-businesses seem stuck with anonymised data that reveals little about their visitors or customers other than at an aggregated level. A bit like a shopping mall operator who sees people come and go, visit shops and buy stuff but without knowing who they are, where they live, why they visit, where else they shop and what they think.<br />
So we were delighted to discover that one of our technology partners has a fantastic "plug and play" tool for discerning the "small data" within the e-commerce eco system. This enables us to identify who visits the site, where they have come from, what they searched for, what they looked at, what they carefully considered or disregarded and what they bought. We can do this for key segments of valuable prospects or customers of a particular type or by individual. We can alter the content of the site (without touching the CMS), ask questions, keep customers engaged and automatically link what we know to a personalised and relevant follow up contact whether that's by email, snail mail or social media. <br />
Some of the e-commerce leaders like Tesco and Shop Direct are able to do this, but we are increasingly surprised by the number who can't.<br />
We predict a switch away from tired, staid, boring and anonymised web analytics to a better world of personalised insight built from the "small data" behaviour of individuals that enables more engaging content, service and sales.<br />
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If you'd like to know more, please contact us at <a href="http://www.sg-retail.co.uk/"><span style="color: blue;">www.SG-Retail.co.uk </span></a>Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com1tag:blogger.com,1999:blog-8679287851873486646.post-43655034251758097362013-09-12T20:53:00.001+01:002013-09-12T20:53:47.072+01:00New Research Debunks 'Showrooming' Myths<table cellpadding="0" cellspacing="0" style="background-color: white; color: black; font-family: Arial, Helvetica, sans-serif; width: 100%px;"><tbody>
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New Research Debunks 'Showrooming' Myths: Shows Brick-and-Mortar Retailers How To Keep Smartphone-Wielding Shoppers Spending ...</h2>
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With brick-and-mortar-retail stores continuing to struggle with the rise of showrooming" consumers – those visiting a store to see a product but then purchasing it later online – groundbreaking research from <span class="xn-org">Columbia Business School</span> and global loyalty experts Aimia shows retailers concrete steps they can take to entice consumers armed with mobile devices to make purchases <i>inside</i> their store walls. The report, <i>Showrooming and the Rise of the Mobile-Assisted Shopper </i>identifies five distinct segments of mobile-assisted shoppers and uncovers clear opportunities for retailers to engage and retain these tech-savvy customers.</div>
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Some of the key takeaways of the report include:</div>
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<li><b>Showrooming isn't just for the Millennial Generation:</b> Contrary to popular belief, 74% of M-shoppers are older than 29 years old.</li>
<li><b>Mobile devices can actually improve the chances of an in-store purchase:</b> More than 50% of M-Shoppers are more likely to purchase a product in-store when their mobile device helps them find online reviews, information, or trusted advice.</li>
<li><b>Price isn't always the most important factor:</b> Although "price checking" is the number one action of M-Shoppers, <i>convenience, urgency, and immediacy</i> are the top three reasons why M-Shoppers will buy in-store even if they find the same product cheaper online.</li>
<li><b>Loyalty programs are worth more than just their points:</b> 48% of M-Shoppers say that being a member of a store's loyalty program makes them more likely to purchase products in-store, despite equal or cheaper prices online.</li>
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The researchers looked at the attitudes, shopping patterns, and motivations of 3000 leading-edge consumers in the US, UK, and <span class="xn-location">Canada</span> to better understand how mobile devices are impacting their in-store shopping habits; identifying those shoppers most likely to showroom; and outlining actions retailers can take - such as loyalty programs, price matching, free shipping, and mobile payments - to encourage consumers to open their wallets in-store. The results paint a clear picture of today's mobile assisted shoppers – or M-shopper – and debunks commonly held assumptions many brick-and-mortar retailers make about retail showroomers.</div>
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<b>Luring Back the Five Segments of Mobile-Assisted Shoppers </b>The research found that there are five distinct types of mobile-assisted shoppers and uncovered clear opportunities for retailers to engage and retain the business of these tech-savvy customers.</div>
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<li><b>The Exploiters:</b> It would be easy for retailers to write off the Exploiters as a lost cause. But the best opportunity for retailers to win their business may simply be to improve the store's website. When Exploiters see a product on the shelf and pull out their mobile device, they are nearly as likely to search for it on the store's own website as on a competitor's site (69% vs. 77%).</li>
<li><b>The Savvys</b>: Although they currently represent only 13% of mobile-assisted shoppers, Savvys are the ripest target for retailers to try out new offers and experiences in the mobile space. They are simultaneously more digitally-savvy, more willing to sign up for loyalty programs, and more likely to be motivated by a range of retailer offers and rewards.</li>
<li><b>The Price-Sensitives: </b>Price-Sensitives use their devices in stores periodically, but not as consistently as the other segments. Often, the right in-store experience will be enough to earn the Price-Sensitives' business. Their mobile devices may be with them, but still remain in their pockets and purses.</li>
<li><b>The Traditionalists:</b> These shoppers are committed to purchasing in-store, making them the least threatening segment of mobile-assisted shoppers for retailers. They are open to interacting with retail stores on their mobile devices, whether by website, store app, or even scanning a QR code. But, they are currently using their devices mostly to consult on purchases with friends and family.</li>
<li><b>The Experience-Seekers:</b> As the largest of all the segments, Experience-Seekers point to the opportunity for retailers to engage customers on their mobile devices in non-financial ways, with opportunities to comment, provide ratings, etc. And they demonstrate why retailers still need to invest in providing a unique and compelling in-store experience.</li>
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"Our findings debunk many of the common assumptions about the threat of showrooming and who is doing it," said <span class="xn-person">Matthew Quint</span>, a co-author of the study and director of <span class="xn-org">Columbia Business School's</span> Center on Global Brand Leadership. "Many shoppers with smartphones care about more than just the lowest price on every item. In fact, while roughly 25% of M-Shoppers may require a discount to motivate in-store purchases, a clear majority can be enticed to purchase in-store through information assistance, engagement strategies, and strong loyalty rewards programs</div>
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Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-31074163963018110932013-08-16T09:10:00.002+01:002013-08-16T19:41:23.230+01:00The "Omnichannel" opportunity for Retailer<div>
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<b><span style="font-family: Arial, Helvetica, sans-serif;">The "Omnichannel" opportunity for Retailers</span></b><br />
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<span style="font-family: Arial, Helvetica, sans-serif;">It’s a digital jungle for retailers today—and all too tempting simply to jump on the next new thing (and the next and the next), just in hopes of keeping pace. </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Every omnichannel strategy is unique to the business it drives, and we see a series of factors that all retailers need to consider. </span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">A thorough diagnosis of the challenges faced will take into account existing assets and capabilities and marry them to a plan for capitalizing on e-commerce and e-influence opportunities</span></div>
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<a href="https://www.bcgperspectives.com/content/articles/retail_digital_economy_omnichannel_opportunity_retailers/">https://www.bcgperspectives.com/content/articles/retail_digital_economy_omnichannel_opportunity_retailers/</a>Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-22953012657770184902013-08-16T09:01:00.002+01:002013-08-16T19:41:37.867+01:00The Age of "Digital Eco-Systems"<span style="font-family: Arial, Helvetica, sans-serif;"><b>The Age of "Digital Eco-Systems" </b></span><br />
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<span style="font-family: Arial, Helvetica, sans-serif;"><b>By 2020, most ordinary devices in the home will have gone digital. They will no longer be islands unto themselves. </b></span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;"><b>Consumers will increasingly use digital devices to access, monitor, and control their connected digital products and services remotely over the Internet.</b></span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;"><b>Massive streams of complex, fast-moving “big data” from these digital devices will be stored as personal profiles in the cloud, along with related customer data.</b></span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;"><b>At the center of these interconnected devices and services are digital-ecosystem platform owners.</b></span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;"><b>We believe that digital ecosystems will profoundly disrupt businesses in nearly every consumer-centric industry</b></span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">To see the full article , click the following link : </span><br />
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<a href="https://www.bcgperspectives.com/content/articles/information_technology_strategy_digital_economy_age_digital_ecosystems_thriving_world_big_data/">https://www.bcgperspectives.com/content/articles/information_technology_strategy_digital_economy_age_digital_ecosystems_thriving_world_big_data/</a><br />
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<br />Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-2998440185946807882013-05-24T22:49:00.001+01:002013-09-13T18:21:38.780+01:00How shoppers are using smartphones instore<br />
Some interesting new research on how shoppers are using smartphones instore...<br />
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<a href="http://ssl.gstatic.com/think/docs/mobile-in-store_research-studies.pdf">http://ssl.gstatic.com/think/docs/mobile-in-store_research-studies.pdf</a><br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjtcVMHBQMTnzN9FaBlWPy2Ddefz2Lba7ePYrCz57ntyrPE3pM4lRJNvFSYlS0cL4JfC5pBilWIztwaHFRd4BY2VrOUQ04ZptdkVrGTyNklhCeH6LEQbtjw6u9QmIv5JCQFiSnlqgF7ulnR/s1600/2013-01-26+15.59.28.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="240" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjtcVMHBQMTnzN9FaBlWPy2Ddefz2Lba7ePYrCz57ntyrPE3pM4lRJNvFSYlS0cL4JfC5pBilWIztwaHFRd4BY2VrOUQ04ZptdkVrGTyNklhCeH6LEQbtjw6u9QmIv5JCQFiSnlqgF7ulnR/s320/2013-01-26+15.59.28.jpg" width="320" /></a></div>
<br />Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-59566553552388796722013-03-18T08:26:00.000+00:002013-03-18T08:31:32.036+00:00Interesting insights into instore wi-fi usage<br />
Some interesting insights from a USA Mobile Audience Insights Report into usage and attitudes concerning instore wi-fi carried out by JiWire. Data comes from a survey of more than 1,400 randomly selected customers across 315,000 USA public wi-fi networks. The report is based on data collected from Nov ‘12 through Dec ‘12. .<br />
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<b>Key highlights include:</b><br />
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The top 4 activities shoppers use their mobile devices for while in a store are :<br />
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<b>1. price comparison</b><br />
<b>2. find and read product reviews</b><br />
<b>3. find coupons and offers</b><br />
<b>4. access the stores website</b><br />
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<b>Women are using mobile in stores significantly more than men </b><br />
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<b>Consumers are most likely to use their mobile device for shopping while in an electronic store (44%) - almost twice as many as the next category which is surprisingly clothing (26%), which is significantly ahead of big box retailers and restaurants - both 14%</b><br />
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<b>80% of mobile consumers are influenced by the availability of in-store wi-fi when deciding where to shop - this is particularly so amongst younger consumers - but even the “least” interested shoppers, age 45+, are over 77% influenced by in-store wi-fi availability</b>.<br />
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<b>84% of mobile consumers prefer receiving complimentary, ad-supported wi-fi rather than having to pay for it</b> with 65% happy to watching a 30 second video. Only 8% of consumers would rather pay for wi-fi than endure adverts.<br />
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SG-Retail are currently working with Zapfi to bring Zapfi's instore wi-fi solution to the UK. Zapfi are a leading European wi-fi provider working with major retail and leisure brands in Europe including 2 of Benelux's leading retail banks, C&A (Clothing), Quicks (fast food), Total (Petro retail), Delhaize, Cora (Supermarkets). <br />
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We provide deep customer insight. Helping retailers to understand who is in the store, with what frequency they shop, what they do when online in the store (including "show rooming" and an ability to send targeted and highly relevant messages.<br />
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<br />Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-70951823511555309882013-03-08T17:23:00.000+00:002013-03-18T08:31:52.502+00:00Thoughts on in-store wi-fiA number of retailers already offer their customers free instore wi-fi. Tesco, Debenhams, HMV and John Lewis are among the early pioneers. Others seem certain to follow. Why are retailers doing this ?<br />
It enables them to provide mobile based services in-store to better serve customers (eg ipads for queue busting or extended product ranging) but the key reason is that its something that customers want and increasingly expect. Not to provide wi-fi risks being competitively disadvantaged and used well can grow customer engagement, sales and profits.<br />
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An in-store wi-fi platform generates "big data" and a rich source of customer insight. The platform operator can see every session on every connected phone or tablet. It enables retailers to know who is in the store, when and where; how frequently they are visiting and how long they are spending there. Linking to the retailer's loyalty or CRM programme enables understanding of browsing and conversion. Retailers can observe "show-rooming" behaviour and potentially intervene to off set it. The potential exists to send highly personal, targeted, permission based offers direct to customer's phones or tablets and targeted to the particular content that's being consumed.<br />
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In selecting a wi-fi platform provider, retailers need to ensure that they secure access to the data and own the marketing rights. We know of one major retailer who is being provided with free wi-fi by a major telco provider but is not able to access the data or use the marketing platform for their own purposes This is a missed opportunity to say the least.<br />
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SG-Retail are working with a number of retailers to provide advice on how best to leverage instore wi-fi. We have capability to analyse the data and help integrate with retailer loyalty and CRM systems in order to grow value for customers and shareholders.<br />
Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-74045041324432136592013-03-07T08:58:00.001+00:002013-03-07T08:58:20.673+00:00CPGs : winning with joined up "big data"<br />
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Good article from Mckinsey on how winning CPG's will be need marketeers who "get" IT and vice versa. Both will need to "get" the power of data. We see an opportunity for CPGs to create competitive advantage by joining up their retailer, shopper and consumer data and using it to drive "Perfect Store" outcomes. We think the key barriers are not technical but organisational Retailer, Shopper and Consumer tend to be managed in differing silos. Joining them up will require organisational change led by leaders who have the right vision and a rare blend of multi functional skills.<br />
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<a href="http://www.mckinseyquarterly.com/Winning_with_IT_in_consumer_packaged_goods_Seven_trends_transforming_the_role_of_the_CIO_3065">http://www.mckinseyquarterly.com/Winning_with_IT_in_consumer_packaged_goods_Seven_trends_transforming_the_role_of_the_CIO_3065</a><br />
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<br />Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0tag:blogger.com,1999:blog-8679287851873486646.post-22323578246418691332013-02-27T11:30:00.001+00:002013-02-27T11:30:31.975+00:00B&Q mobile loyalty app<br />
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DIY retailer B&Q has launched a new app for users to redeem loyalty offers on their smartphone and access deals on the go.</div>
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The B&Q Club has more than 690,000 members who will be able to download the app from the retailer’s website.</div>
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Shoppers will show their phone to a member of staff in store who can input their barcode at the check out.</div>
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<span style="color: #333333; font-family: Arial, Helvetica, sans-serif;"><span style="font-size: 1.077em; line-height: 18px;">B&Q will then be taking the service further with then introduce of new in store point-of-sale scanners later in the year allowing shoppers to scan the </span><span style="font-size: 17px; line-height: 18px;">bar codes</span><span style="font-size: 1.077em; line-height: 18px;"> themselves.</span></span></div>
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Research carried out by the retailer showed 64% of smartphone owners use their phones in store. The retailer hopes to bolsters it multichannel credentials and reduce the use of paper by switching to the app.</div>
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B&Q financial and business services general manager Steve Clark said: “We are proud to launch the B&Q Club app that offers a quick and convenient way for our loyalty scheme members to take advantage of the very latest offers and deals from the club.</div>
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“We are acutely aware of how our customers are feeling the pinch and this is one way in which we can reward their loyalty and help make that hard earned cash go a little further. This initiative is a continuation of our commitment to being fully customer focused and delivers the omnichannel retailing approach, that contributes to B&Q and <a class="intextlink" href="http://www.retail-week.com/companies/kingfisher" rel="intextlink_0" style="color: #990000; text-decoration: none;">Kingfisher</a>’s Creating the Leader strategy.</div>
Steve Gray http://www.blogger.com/profile/04522045185417449753noreply@blogger.com0