Applying technology to boost customer loyalty

Guesswork no longer cuts it. Smart companies are using business analytics software to improve customer loyalty.

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These offers can go out via text message, email, the call center or physical stores. "When the customer is on the phone or walks in the store, we get more fresh data about them to help reps select the best offer at that specific time," Bessho says. "We can take advantage of historical data, as well as dynamic data, to create personalized, focused offers based on customer trends and behaviors."

T-Mobile also uses tools from Business Objects to produce dashboards and detailed operational reports for marketing leaders. It will soon launch a mobile business-intelligence capability so marketing execs can view the current performance of marketing campaigns on their tablets.

T-Mobile still faces challenges, including the need to recover from its failed buyout deal with AT&T and the June departure of its CEO. But the company is betting on customer insights to bolster its future prospects. It plans to add 300 more customer data attributes to the system to deepen and broaden its analytic capabilities, and it will add input from social media as well. In the first quarter of 2012, T-Mobile saw 187,000 net customer additions, compared with 99,000 net customer losses in the first quarter of 2011. "Our goal is to reduce churn, enhance loyalty, upsell and cross-sell new devices and rate plans, and make customers happier, while achieving better financial results," Bessho says.

SuperValu: A New Approach to Loyalty

For grocers, the concept of "loyalty" has historically been tied to the "loyalty card" -- those ubiquitous laminated cards that give shoppers automatic discounts. But market forces are driving grocers like SuperValu to kick their customer loyalty games up a notch. According to Wesley Story, group vice president of consumer insights and loyalty at SuperValu, competition is heating up, especially as more types of retailers -- from big-box stores to discounters -- add grocery items to their shelves. About two years ago, SuperValu launched an effort to become more customer-centric by creating a hassle-free shopping environment, offering more freshly prepared foods and matching product lineups to local tastes.

Customer data gathered from loyalty cards is key to this strategy, Story says, because it reveals buying trends and demographic shifts. "If you're not careful, all of a sudden the customer that was your target no longer lives around you," he says.

According to a study by RIS News and IDC Retail Insights, localizing merchandise and personalizing interactions has pushed business intelligence and analytics -- in particular, in-memory, data appliance and grid computing capabilities -- to the top of the priority list for grocers concerned about customer loyalty.

SuperValu has long used a Teradata data warehouse and traditional BI tools to analyze transaction and customer data. But it recently set up a big data analytics lab to accommodate faster, more complex, ad hoc queries against all types of data, including unstructured data from social media. The lab's tools include Teradata's Aster appliance, which collects data from operational systems and puts it in a nonproduction database optimized for analysis; Hadoop, an open-source analytics platform that uses parallel processing to quickly analyze large data volumes; and a visualization tool from Tableau Software designed to rapidly deploy dashboards that mash up various types of data, including information from external sources.

With this setup, SuperValu no longer needs to know how data will be structured or what questions it needs to ask. "If a query doesn't work, we can just throw it away because the investment is minimal versus weeks and months of development," Story says.

The grocer is already better able to keep popular items in stock by studying out-of-stock data from its inventory management system, peak shopping times from its transaction data, staffing levels from the labor management system and customer perceptions from its "voice of the customer" system. It has determined that certain stores needed to add a midday restocking shift to accommodate the rush of traffic between 4 p.m. and 6 p.m. "Some of this is Retail 101. But before, we didn't know exactly what the staffing levels needed to be at what stores or what the customer perception levels were," Story says.

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