loyalty matters

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Experian Public.

Loyalty matters

How better data drives more loyalty and more revenue

June 25, 2015

2 © 2015 Experian Information Solutions, Inc. All rights reserved.

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Introducing our speakers

Shirley Zhao, Content Marketer, Experian Data Quality

Melanie Clark, Retail Partner Manager, Experian Data Quality

Today’s agenda:

► The stats around loyalty

● Prevalence of loyalty

● Loyalty data collection

● Strategic initiatives

► Three ways to improve loyalty insight

► Consumer insights available through data

► Q&A

Loyalty and data quality


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Methodology

29%

2%

47%

12%

4% 6%

Industry sectors

Manufacturing

Travel

Retail

Financial services

Utilities

Telecom

Polling question


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Prevalence of loyalty

54%

67%

53% 51%

2% 1% 0%

10%

20%

30%

40%

50%

60%

70%

80%

Purpose of loyalty programs

Drive revenue Customer retention Increase lifetime value Promote brand Other Don’t know

A loyalty program is a system wherein retailers or service providers offer rewards to customers who repeatedly use their services or purchase

their products


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Return on investment

Today, 69 percent of companies are tracking the lifetime value of each customer. For those tracking the lifetime customer value, the average

value of a customer is $1,803

58% 17%

6%

11%

5% 4%

Return on investment from loyalty programs

Yes, it is calculated annually

Yes, but it is not supported by metrics

No, we do not see a return oninvestment

No, we do not calculate the return oninvestment

We do not have a loyalty program

Don’t know


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Loyalty program channels

78%

54%

46% 44%

2% 3%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Loyalty program channels

Website Point-of-sale Call center Mobile application Other Don’t know


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Loyalty data

73%

58%

81%

59%

22%

39%

4% 3%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Data provided during loyalty sign-up

Name Address Email Phone number Preference center Birthday Other Don’t know


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Key challenges and strategic initiatives

22% 25%

36%

18% 23% 21%

15%

2%

0%

10%

20%

30%

40%

Loyalty program challenges

Messages do not engage consumers Poor contact data quality

Not enough customers signing up Rewards are too complicated

The program is too expensive Not enough customer data

Technology is not relevant Other

Eighty-one percent of companies face challenges related to their loyalty program. The two biggest challenges related to loyalty programs are not

enough customers signing up and poor contact data.

Three ways to improve loyalty insight


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Improve loyalty and drive insight

Start with an accurate, consolidated and accessible database to ensure insight and analytics can be achieved

Clean your loyalty data

Consolidate records to review all

information

Improve overall loyalty

program


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Accuracy of customer data is of paramount importance to the effectiveness of a loyalty program


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Loyalty


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Loyalty


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Loyalty


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The first step to improve a customer loyalty program is to increase the accuracy of customer data


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How do validation software tools improve customer data?

Correct some Misspellings

Identify invalid addresses

Append Zip Code + 4

Format addresses

Suggest corrections

Reduce bounce rates

Improve sender reputation

Increase deliverability

Improve email performance

Email Address


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Consolidate records to review all information

A loyalty program is most effective with customer knowledge. Duplicate

identification & matching supports a single customer view

Jonny

Smith

John

Smith

JOHN

SMITH

Jonathon

Smith


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Four steps can be taken with current or new data that will

lead companies to a single customer view


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Jonny

Smith

John

Smith

JOHN

SMITH

Jonathon

Smith


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Jonny

Smith

John

Smith

JOHN

SMITH

Jonathon

Smith


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By directly integrating a matching tool, end users can automatically use matching functionality without disrupting any existing workflows.

Database

Improve overall loyalty program


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Ongoing involvement

Where Are You Heading?

Know Your Customer

Find More Like Them

Campaign Enhancement

Multi-Channel Optimization

Link disparate data silos

Identify best customers

Enrich data

Modeling, segmen-tation

Find more best customers

Develop Targeted Campaigns

Modeling, and advanced segmen-tation

Activity score for best channels, devices

Rigorous testing

Recognize channel preference

Campaign Measure-ment

Enabled across multiple platforms

Offers

A/B

Device


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Improve loyalty and drive insight

McKinsey estimates that retailers could improve operating margins by c. 60% by better leveraging their customer data

45%

27%

41% 43%

33%

44%

22%

3%

0%

10%

20%

30%

40%

50%

Turning data into insight

Wanting to understand customer needs Wanting to determine past marketing campaign performance

To secure future budgets Wanting to increase the value of each customer

Customization of future campaigns Wanting to find new customers

Driving more traffic from one channel to another Other


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Key questions to ask about your culture:

1. Is my organization open to new ideas that challenge current practice?

2. Does my organization view data as a core asset?

3. Is senior management driving the organization to become more data driven and analytical?

4. Is my organization using analytical insights to guide strategy?

5. Are we willing to let analytics help change the way we do business?

Using data to create insight

Culture is the driving

factor for driving

competitive advantage

from data & analytics

Companies with a top-down mandate for

fact-driven decision making are

experiencing gains with analytics to a far

greater extent than other organizations

Taken from The Analytics Mandate MIT/SAS research study May 2014

Key takeaways

Loyalty programs are used by 91 percent of companies

Clean and consolidate your data

Real-time vs. back-end solutions


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Experian Data Quality Products & services

Service Options

Real-time validation

Bulk processing

Duplicate identification

Data append

Data Validation

Postal addresses

Email addresses

Telephone numbers

Data enhancement

Demographic

Deployment options

On premise

On demand (hosted web services)

Bureau services

Seamless integrations with enterprise application providers:

30 30

Questions? Stay connected with us for up-to-date insights:

[email protected]

@ExperianDQ

www.edq.com/blog/

https://www.edq.com/blog/

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loyalty matters

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purpose of loyalty programs

data qa

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