It’s really all about me. Sincerely, your customer


In the days before the Internet, I’d pull a promotional flyer or catalog from one of my favorite retailers out of my mailbox or newspaper like an excited kid hoping it contained something I coveted. And at price so amazingly low that I’d feel no guilt in buying it.

More often than not, I was disappointed.

Flash forward to today. I still get the same, generally disappointing offers via snail mail (I don’t read newspapers anymore), but those offers show some improvement. Even better, sometimes I can find offers online that make me a very happy buyer.

But better still, I can create my own wish lists at online vendor sites and they’ll email me when something I selected for my list is on sale. Sadly, not all retailers have reach this level of precision. More often than not, they seem to reuse the previous year’s off-target circular.

Recently, I was editing a new white paper about using customer analytics to make promotion decisions. What I learned from the paper was that often the problem is that retailers can't locate the answers they need in their data. But believe me, with the mountains of data that are being collected daily by vendors, the answers are there.

You have to, of course, look in the right places. To make the answers easier to find, here are eight questions a retailer can ask of their data:

  • How does a particular promotion affect the growth of customers’ baskets?
  • Which customer segments respond best to promotions?
  • How many customers, by customer segment, buy promoted products?
  • What products do customer segments buy on promotion?
  • How much do customers buy on promotion? How much do they spend? How many units are sold per customer?
  • How often do customers purchase the product, or product group, when it is on special versus regular price?
  • How profitable are customer trips or visits that include promoted products?
  • Which customer segments affect or increase company sales and profits?

Seems like a daunting list, right? But in reality, it’s not. Five fairly easy to collect metrics will give you the answers:

  • Customer or household penetration rate by customer segment.
  • Spending per trip or visit.
  • Margin per trip or visit.
  • Customer or household trips or visits per week.
  • Units per trip or visit.

Retailers can use these metrics to build their promotions strategy – who they want to target and whether they want to increase basket size or to maximize the number of trips or visits.

The final step is what I mentioned earlier. Make your offers relevant to me. The selfish lot that we customers are, we demand offers that feel personalized. To find out how, read the free white paper, Applying Customer Analytic to Promotion Decisions, for examples of what you can achieve by paying attention to what your customers’ actions are telling you.


About Author

Jeff Alford

Principal Editor

Jeff is a Principal Editor on the Thought Leadership, Editorial and Content team at SAS He's a former journalist with more than 30 years of experience writing on a variety of topics and industries for companies in the high-tech sector. He has a master's degree in technical and professional writing and loves helping others improve their writing chops.

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