How supermarkets could blend the online and the off line Worlds to make customers more loyal

Posted on 20th July 2010 in Business & User Experience

If you shop in the UK at Tesco you’ll be familiar with the check out conversation that starts with “have you got a Clubcard”. These loyalty cards have proven a successful way for supermarkets to encourage repeat business, get to know their customers and to use as a marketing platform to promote new products and services.

But they have not been exploited enough. As a Clubcard holder I know that there is a goldmine of untapped data that Tesco hold in relation to me. They know how often I visit their stores. They know which stores I go to. They know what I buy, how much I spend, which day, month, year I spend the most. They know more about my buying habits than I am consciously aware of.

Yet, this information is not used nearly as fully as it could be. Yes, they send me vouchers for things I like to buy, and what appear to be personalised special offers and promotions, but they could do so much more.

Imagine if at Tesco.com you had a reporting function that allowed you as a customer to view detailed reports of your own spending habits.

Which foods do I buy the most of? Which foods cost me the most? How much did I spend on alcohol in the last month? How much have I saved by shopping with Tesco over the last three months? As a consumer there are a whole host of benefits that these reports could give you. A break down of the type of food that you buy could highlight that you’re consuming twice as many snack foods as fruit and vegetables. It may highlight that you are going through more wine than you thought, or that you’re visiting the store far more often then you thought, or buying your lunch 4 days a week at a cost of £40 per week. People are generally unaware of their spending habits, because the effort of tracking and analysing them is just too much.

Simple, easy to understand spend analysis can be a fun, interesting and behaviour changing tool for consumers. In a World where it has become more and more difficult to differentiate your business from your competitors, any way that you can add value for your customers is a good thing. In a World where everyone is feeling the pinch of tough economic times and is looking to save money where ever they can, being able to help your customers make smarter, more informed buying decisions is a great way of adding value and creating brand loyalty.

Why should supermarkets want to help us make better buying decisions? Well, I could play the corporate responsibility card here, and suggest that the big supermarkets owe it to society to help us eat healthier and spend our money more wisely, but while a valid point its unlikely to persuade most.

A more persuasive argument for the supermarkets would be that providing such a service would encourage repeat buying and increase their web offering’s “stickiness”. Once your shopping habits are being displayed to you in a fun, meaningful way you’ll not want to dilute the value of your data by shopping elsewhere. If you pop into Asda for this week’s shop your spend data won’t be complete. If Tesco could tie in offers and their reward points to your spending reports, you’d be doubly encouraged to be more loyal.

As anyone who has access to a Google Analytics account, or follows the stats on their twitter stream, web site performance, Facebook updates, etc will know it can become addictive. Getting your customers hooked to their data feed and having them coming back week after week to view the updates presents the perfect ready made audience for targeting with related services, offers and promotions.

Supermarkets aren’t the only ones who could offer such a service either; your bank could give you a monthly debit or credit card report. Your phone provider could make much better use of your call history, department stores, book shops, even coffee shops that all offer loyalty cards could also offer spend reports.

As more and more companies seek to engage with their customers across multi-channels they need to start thinking about how to tie in our physical actions and the data stream that results from them with our online World.