Noble Marketing Category Management Consultancy - Data's Final Frontier, Tesco Loyalty Card

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Data's Final Frontier: Tesco Loyalty Card Data

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Data's Final Frontier: Tesco Loyalty Card Data

The success of Clubcard is staggering. Out of 18m card issued (not counting all the people with Tesco credit cards combined with Club Cards), 10m are used regularly, with over 80% of all Tesco's sales being registered against a Clubcard. The money off coupons that Tesco targets at consumers in their quarterly mailings achieve an 18% redemption, which is well above the industry average. And of course, the whole programme generates an enormous amount of data.

Tesco's application of its own data

Tesco have coded every SKU they handle against 17 product attributes such as Healthy/unhealthy, big box/small box, fresh/ambient. Each sku scores 1, 0 or -1 on each of these attributes which gives it what Tesco refer to as a "DNA". As the consumers pile items in their baskets, all these product DNA scores accumulate to give each consumer a unique DNA. By grouping consumers based on their DNA, a segmentation has been developed that reflects their buying behaviour, as expressed by the products they actually buy. This segmentation is the basis for Tesco's marketing activity against its own database. The segmentation of each consumer is dynamic as it is constantly reweighted to what was in the consumers basket over the last 12 weeks.

Manufacturer's application of Clubcard data

Tesco have mainly out sourced the processing and analysis of Clubcard data to a statistical agency called Dunnhumby. With the agreement of Tesco and payment of the appropriate fee, the data is available to Tesco suppliers. While Tesco will not allow Dunnhumby to divulge names and addresses, suppliers can interrogate to an incredible degree the shopper behaviour of people who buy (or don't buy) their products. To describe what is possible with this data source is almost impossible - you are better thinking in terms of what possible questions you have ever had about your consumers, then asking if the needed attributes are held in the Dunnhumby database, but here are a few examples.

Anything you could do with Nielsen or TNS panel data, you could do with this source. The only difference is that the panel size is 10,000,000 not 10,000.

Who are my heavy buyers? What is their media consumption? Do they own a pet?

Did my promotion just reward existing buyers or did it attract new users?

Did my light buyers sample my promotion? Has it affected their behaviour since then?

Compare the behaviour of online shoppers versus the behaviour of the same people when they actually visit a store.

Many thousands of consumers are part of clubs, such as Baby, or Toddler, where the consumer has to "Op in" to receive appropriate mailings. Many of these consumers have ticked the right boxes that means permission has been gained to send them qualitative questionnaires (names and addresses protected).
Find out more by visiting www.dunnhumby.com

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