Don't discount the value of data in keeping loyalty programs engaging

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Because I travel on a regular basis for my job, membership to the airlines and hotel loyalty clubs are a necessity. When not on the road, I belong to the grocery and warehouse clubs. I am always surprised that with all the information they seem to gather on my travel to food choices — why almost none can predict with accuracy my next purchase. For example, I travel regularly to Chicago, San Jose, and NYC, but have yet to receive an airline or hotel promotion specifically for these destinations. Now I just quietly delete the weekly e-mails, promotions and newsletters without even opening.

Last year, I was diagnosed with Celiac disease. My grocery list no longer includes any wheat or dairy. But on a weekly basis, my grocery and warehouse "loyalty" clubs continue to send me promotions for food I can't eat. Well, recently one grocery chain has changed the game.

I was going through my mail and saw that King Scoopers had sent me a direct mail piece with coupons. This appeared to be different than the ordinary Sunday flyer or past mail promotions. I opened up the mailer and saw a personalized note along with coupons for select products. I went through all 14 coupons in detail. Interestingly enough, nine of 14 coupons were items I purchased on a regular basis and would use.

The next day, I took these coupons to my data analytics team. Apparently, King Scoopers developed a model that predicted what I would buy. The coupons with several bar codes were products it were testing whether I would like. Coupons that had only one bar code were coupons it was sure I would use, while the others were those it predicted I may have the highest propensity to use. Not all product selections were correct — one had a pizza offer and another a bread offer — but the other three were right on target.

In these tough times, it makes sense to grow what you know about your current loyal customers. King Scoopers used the existing data, performed basic modeling and sent relevant coupons to drive loyalty and ROI.

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