CRMC 2013 "Power to the People"

© dunnhumby 2013 | confidential

Power to the People A New Model for

Customer-First CRM

June, 2013


● Driving forces behind Raley’s

● Raley’s no longer a conventional grocery chain

● Raley’s has a loyalty approach, not just a card

program

● Rules that build customer engagement

● Innovations in advocacy

● Customer data driving the business

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Rules changing at an aggressive pace

● Customers’ and their needs

● Buying decisions

● Retail options

3


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The competitive landscape is changing rapidly – especially in California

New threats from

old competitors in

existing

channels…

New threats from new

competitors in new

channels…

Suppliers selling

direct to

consumers…

Competitors leveraging

new models…

Growth of clubs…

Saturation of grocery…

LOW END

HIGH END


“Raley's makes our customers' lives easier and better by delivering a personalized food shopping experience.”

Mission Statement

“We build lasting relationships with our customers by anticipating their needs and exceeding their expectations.”

Our Core Values


Traditional product centric

Customers treated the

same

Mass marketing

One size fits all

Risk averse

We can do it ourselves

Customer centric

Managing change &

engaging the organization

New talent to deliver

Technology

Strategic partners

From To

Raley’s transformation is centered around personalizing the customer experience


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Transactional/

functional

Emotional

engagement

Did I get

what I want?

How did that

make me

feel?

How do I feel

about this

retailer?

Taking meaningful steps to emotionally engage our customers


The Raley’s and dunnhumby partnership was initiated through common beliefs

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Best-in-Class

Proven Results

A-Team on site

Global Learning

Culture

Flexibility

Speed

Test & Learn

Values Alignment

Outrageous Thinking

Future thinking

Innovation

Passion

Vision


Raley’s wanted to reward and retain our best customers but knew a loyalty program alone wasn’t the answer

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A loyalty card is the business enabler for insight, improved customer and employee engagement

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direct

communication

more effective

mass media

customer-

based

decision tools

test & Learn

smarter

pricing

rewards

(loyalty

program)

customer-led

assortment

more efficient

promotions

staff

motivation

change ways

of working

getting the

store / brand

right

getting

comms right

getting the right

processes right

organic growth

base sales

direct

communication

more effective

mass media

customer-

based

decision tools

test & Learn

smarter

pricing

rewards

(loyalty

program)

customer-led

assortment

more efficient

promotions

staff

motivation

change ways

of working

getting the

store / brand

right

getting

comms right

getting the right

processes right

organic growth

base sales

A ‘loyalty approach’ creates the breakthrough value retailers are looking for


…rewards you for being you.

Launched Aug 2012

700,000 active customers

Points based program

Digital bias with paper variations

Load to card


Something Extra provides members with five overt key benefits

● Personalized Offers

● Extra Points

● Rewards

● Inspired Ideas

● Extra Surprises

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Our approach combines loyalty and advocacy to deliver on our promise to give customers ‘Something Extra’

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Increase LOYALTY of

Raley’s Best Customers

Cultivate ADVOCACY for

Raley’s and our Suppliers

both online and offline


Executing a predominately digital program means we have to be relevant to cut through the clutter

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We are all bombarded by…

1. Other grocers!

2. National retailers

3. Specialty retailers

4. Local retailers

5. Travel sites

6. Service providers

7. Financial services

8. Entertainment

9. Magazines

10. News articles

11. Google alerts

12. Bill collectors

13. Social media sites

14. Personal emails

15. etc…

16. etc…


The key to cutting through the clutter is consistent quality, not quantity

The key to quality is RELEVANCE

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We ARE incentivizing our customers to

shop with us every trip

Rewards

Extra Points


Email provides a base communication to reach our most engaged customers

● Initial emails designed to:

– on-board shopper into the program

– experience the benefits quickly

● Shoppers receive a consistent flow of

offers based on their visit pattern

● Limited number of offers to increase

relevancy

● Offers based on items customers are

buying already

● Takes customers to Raleys.com where

additional offers & information can be

found


The Quarterly Rewards Statement is the flagship of Something Extra

● 1% reward for every customer

collecting 500 or more in a

quarter

● 95% of coupon combinations

are unique

● Limited number of offers to

increase relevancy

● Offers based on items

customers are buying already

● Paper and digital versions

based on preference


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Success is coming by doing the hard work to make it

easier for the customer

● >60% sales on Something Extra

● 75% of all members participated in the Rewards Statement or Email

● Open rates up to 65%

● Up to $7 Sales to Cost

● Average 32% coupon redemption

● Over 1200 coupons available

● 500 attendees at vendor summits

● Reporting available to all participating vendors


“What I love are the coupons for items

that are usually on every shopping list,

like coffee and yogurt. My brands and

my packs. Raley’s is paying attention to

me.”

Myrle Pardedd


“Wow! I just received my first “Extra

Rewards.” Six coupons, all of which I can

use plus a $5.00 credit. I am impressed!”

Richard Charles Paul


Something Extra

Try-It is the

platform which

allows us to

cultivate advocacy

at Raley’s


There are four basic steps to every Try-it program

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MEASURE Advocacy impact across

key metrics

ENGAGE Exclusive Raley’s

Experiences

TARGET Loyal shoppers invited to

participate based on

shopper data, profile

surveys & influence

ACTIVATE Participants spread WOM

and share digital content


60% of sales come from our loyal customers (20%), yet we are just capturing 60% of their share of wallet

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Addressing price perception where it matters most

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● Recognition that all customers are

sensitive to price

● Tailor the store to reflect its

customers

● Which customers respond to

stimuli

● Tactics to drive sales where

opportunities exist


Driving efficiency in promotions

● Stop negative-lift promotions

● Actions to improve revenue

– Adjust discount depth

– Try different promotion type

– Stop promoting

– Shift to 1:1 targeted communications

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Improve assortment decisions and get insights on merchants’ desktops

● Product assortment optimization

– Protecting SKUs loyal customers buy and

removing inefficient ones

● Differentiated store assortment

based on customer needs

● Space planning

– Layout and adjacencies

– Navigation


Improved collaboration with vendors with a collective focus on the shopper

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dunnhumby

Manufacturer Raley’s

Improved Sales

Improved

Communication

Improved

Relationships

Simplified

Collaboration


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So, do you have a Loyalty

Program or Loyalty Approach?

CRMC 2013 "Power to the People"

Business

Transcript of CRMC 2013 "Power to the People"