Canadian Retailer - January/February 2010 - (Page 38)

R E TA I L M A R K E T I N G Quest to better serve customers is changing the way retailers collect information It’s no longer enough to have a stockpile of demographic—or even psychographic—data on who’s likely to walk through your door; why they’re doing so and how they like to shop is just as important. BY MICHAEL MCKINNON “R etailers are starting to get more and more sophisticated,” says Todd Kaiser, Vice-President of Nielsen Homescan Custom Research and Segmentation. “They’re starting to use primary research more often, and they’re starting to segment their consumers more.” Simply put, more in-depth segmentation is needed to know the full story. John Torella, Senior Partner with J.C. Williams Group, global retail consultants, uses the example of two 30-year-old men living in the same neighbourhood with the same income. If one is a married-with-children homeowner and the other a single man in a condo, will the same ad campaign work on both? “Of course not,” Torella says. “So we need to know not just age, income and education; we need to know what their lifestyles, interests and attitudes are.” The LCBO, Ontario’s beverage alcohol retailer, has built its success around doing just that. Information such as age and income wasn’t telling the retailer enough, so it dug deeper to determine the emotional connections customers had with the brand. In-depth segmentation revealed younger customers who don’t spend much time at the LCBO, are inexperienced and perhaps lack confidence; the LCBO reacted with Red Wine 101, an education program that won a 2009 Canadian Marketing Association gold retail award. “It was targeted at the consumer who needed a little bit more confidence when they’re shopping and maybe matching the food with wine,” says Pamela Lawson, the LCBO’s Marketing Director of Customer Insights and Customer Relationship Management. “Unlike other retailers, we’re not looking for high-volume customers,” she says. “We’re trying to look at our customer base and find out who is satisfied and what we can do to make the experience more engaging for them.” The LCBO is now focused on completing its “brand dashboard,” which will answer questions about brand investment, brand equity performance, financial key performance indicators, customer satisfaction, brand health, corporate reputation and emotional brand connection. The data was collected through research with focus groups, followed by large-scale quantification through an online survey with 1,700 LCBO customers. “LCBO research and customer insights are becoming more and more important as we try to maximize customer engagement,” says Lawson. “It’s a hard thing to do.” Luckily, the timing is right for this kind of digging. Custom research vendors with syndicated segmentations have © I S TO C K P H OTO.C O M /AVAVA Consumer preference and behaviour data is becoming more valuable. drastically cut costs, paving the way for even some independent retailers to better know their customers. Loyalty programs such as Air Miles and Aeroplan provide retailers with another avenue to collect data; technology has made for an easier process, and retailers benefit. “Recent changes in technology make survey data easier to collect. In economic terms, it’s cheaper to gather research information,” explains Dr. Robert Kerton, Professor of Consumer Economics at the University of Waterloo. “You used to have to phone people or catch them on the street, now you can collect it by electronic means.” Perhaps that’s why Carlton Cards—without its own loyalty program to gather information—turned to Environics Analytics’ Envision Micromarketing to determine whether it was stocking its limited retail shelf space with the right mix of cards. With an analysis of the demographics, lifestyles and competitive pressures within each trade area, Carlton can now produce a 20-page executive report on any of its stores in just ten minutes. More families in one neighbourhood means a wider selection of children’s birthday cards in that store, for example. “It’s a real competitive advantage, for sure,” explains Jim Driscoll, Director of Marketing and Retailer Logistics with Carlton Cards. “We have a full arsenal of products, so it’s just a matter of finding out what appeals to different individuals in different markets so that we could tailor the mix to that store.” The truth is that what retailers think they know isn’t always right. Kerton points to the mistake Canadian banks made a few years ago when they cut back on tellers in favour of 3 8 | C A N A D I A N R E TA I L E R | J A N UA R Y/ F E B R U A R Y 2 010 |

Table of Contents for the Digital Edition of Canadian Retailer - January/February 2010

Canadian Retailer - January/February 2010
Publisher’s Desk
Shop Talk
Store Design
In Your Interest
Retail Generations
Retail Profile
Loss Prevention Supplement
Human Resources
Marketing and Advertising
Member Profile
Advertisers’ Index
You Asked Us

Canadian Retailer - January/February 2010