kroger and personalization: a grocery retailer...
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KROGER AND PERSONALIZATION:A GROCERY RETAILER BECOMING A MEDIA PLAYER?
2018
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2© 84.51° 2018 | Public © 84.51° 2018 | Confidential
KROGER ALWAYS STARTS WITH THE CUSTOMER
2,800 STORES IN 35 STATES
60MM+Households
1 OUT OF 2 HOUSEHOLDS IN THE US
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• Wholly owned subsidiary of the Kroger Co.
• Customer data, predictive analytics and marketing strategy to drive sales growth and customer loyalty
• Partner with Kroger and more than 300 CPG companies in the U.S.
• Employ a sophisticated, proprietary suite of tools and technology to turn customer data into knowledge
• The result = A more personal and dynamic approach to putting the customer at the center of every business decision
84.51° OUR COMPANY
© 84.51° 2017 | Confidential
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DIGITAL OPPORTUNITY
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Customers consume more than 9.5 hours of media each day
PEOPLE SPEND THE MAJORITY OF
WAKING HOURS CONSUMING MEDIA
Q. How much time do you spend on [media channel] in a typical day?
4:17
3:27
0:56
0:52
spent online
watching TV
browsing mobile
on social media
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TODAY THE AVERAGE AMERICAN IS EXPOSED TO 5,000+ MARKETING MESSAGES A DAY
500 per day 5,000 per day
1970 2015
TV
Radio
Billboard
TV
Radio
Billboard
Banner
Video
Pop Ups
Social
Mobile
Texts
Product Placement
less than
50% do not
find ads
relevant or
notice them
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DIGITAL IS ACCELERATING THROUGH MOBILE
Mobile growth is driving overall share of digital commerce
89% 84% 81% 78% 75% 74% 73%
11% 16% 19% 22% 25% 26% 27%
9%
0%
2%
4%
6%
8%
10%
12%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2012 2013 2014 2015 2016 2017 2018
Desktop Mobile Total Share of Retail
Source: eMarketer
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OPPORTUNITY EXISTS….
81% 90%of in-store sales will be
influenced by digital in
by 2021
of customers are comfortable
exchanging their private
information with grocery
stores for relevant offers
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The difference reflects the stock market’s understanding that the
companies’ prized assets, such as search algorithms, patents and
enormous troves of information on their users, don’t show up
on their balance sheets.
REAL VALUE OF DATA AND SCIENCE
Assets - Liabilities Market Cap
$253
Billion
$2
Trillion
Source: Y-charts Jan 2018
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DATADRIVEN
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Cu
sto
mer
Data
Customer Touchpoints
• More touchpoints to reach
customers with new channels
and offerings
• New data sources are created
through emerging technology
and science
• Synergy between the two drives
exponential growth and
differentiation
EXPLOSIVE OPPORTUNITIES FOR GROWTH
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Data silos Focus on consumers
Valu
e
Single truth Enriched insights
Time
New “big” data
ORGANIZE AROUND THE USERTransform Big Data into Value Creation
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It’s chilly—a
good day for
soup
Cassie
regularly
buys soup for
lunch
She uses her
smartphone
for promotions
Because we know this:
What are the data
needs to support this
simple execution of
personalization?
We engage Cassie at
11:30 a.m. on her
smartphone with a
promotion for her
favorite brand of soup
A SIMPLE PERSONALIZATION EXAMPLE
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Because we know this:
We engage Cassie at
11:30 a.m. on her
smartphone with a
promotion for her
favorite brand of soup
A SIMPLE PERSONALIZATION EXAMPLEData Needs for Execution
Context
Data
WeatherDay
Parts
Trip
Mission
Preference
Science
Offer &
Content
Product
& Brand
Channel
Lifestyle
Needs
Real-
Time
Data
Balance
on Hand
Offer
Pool GPS
Location
Personalized
Operations
Data
Delivery
Options
Digital
ID Store
Location
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THE DIGITAL CONUNDRUM
© 84.51° 2017 | Public
Functional Contextual Emotional
De
-Id
en
tifi
ed
Pers
on
alized
InspirationalAspirational
Shopper
Point-of Sale
Market
Mobile / Web
Preferences
Thick Data
Data Needed
to become
Truly Personal
Invest to Move Beyond the Functional Relationships
Demographics
Media
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CONNECTED UNDERSTANDING
© 84.51° 2017 | Public
Expanded and Connected Data
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EARNINGAUDIENCES
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UNDERSTAND THE JOURNEY
DISCOVER SHOP BUY REFLECT
51% 15% 3%31%
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ALWAYS DELIVER RELEVANCE
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AND MEET CUSTOMERS WHERE THEY ARE ONLINE
Highly relevant digital coupons
make up 93% of those redeemed
One additional trip every 9 weeks,
~5 more trips per year. Getting more
customers to engage could result in significant
uplift for Kroger
Customer Benefits: Helps customer
quickly load digital coupons to their loyalty
card saving them both valuable time and
money
Kroger Benefits: Drives customers to
engage with online and mobile, increase in
basket size
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AMPLIFY THE IMPACT
$1.05
$7.35
$13.17
$20.52
$26.82
1 Channel 2 Channels 3 Channels 4 Channels 5 Channels
Sales Uplift per HH by Number of Exposed Channels
7x
1.8x
1.6x
1.3x
DIRECT MAIL + EMAIL MODULES + DIGITAL MEDIA + TARGETED FREE OFFERS = >4:1 ROAS
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SIMPLE MESSAGE ACROSS CHANNELS
DIGITAL MEDIA DIRECT MAIL EMAIL LANDING PAGE
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CONNECTED MEDIA TO ENGAGE CUSTOMERS
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EMBRACE THE DIGITAL
OPPORTUNITY
DATA AND SCIENCE
WILL DIFFERNTIATE
EARNING AUDIENCE
TRUST IS KEY
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THANK YOU