Coffee as the thin edge

Pick n Pay is starting to gain some useful insights into customer behaviour and purchasing decisions at different stores. They’re using coffee as a key product to better understand who buys what, where and when. ¬†They’re tossing out (more likely de-emphaszing) LSMs as a method of categorising customers and moving to more sophisticated measures (including whether the purchaser has children or not, but also I’d expect location, purchase frequency, average basket size, mix of goods etc.)

Pick n Pay had to spend a fortune on the Smart Shopper system and has ongoing expenses in terms of rewards and analysis. The curious thing for me is how many loyalty cards incur the system and reward costs for retailers, but without gaining the full benefit of analysis and thus insight into customers.

I don’t get tailored book suggestions from Exclusive Books. They also haven’t tried to entice me back to their stores since I started buying first from Bookfinder.com and then almost exclusively ebooks from Amazon. They’ve basically lost a customer and haven’t done anything about it.

Even my friend’s St Elmos offers sweet deals to customers who haven’t ordered in a while to entice them back. Pick n Pay turned sub R100 pm customers into R350 pm customers (at least while the special was one) by specifically targeting customers that are familiar with Pick n Pay but need a push to become regular, high-spending customers.

I haven’t had a movie card with Ster Kinekor in a while, but I always use the same email address and credit when I purchase tickets online (which I do almost universally). There have been periods of several months where I haven’t gone to the movies, but no attempt from Ster Kinekor to woo me back with free popcorn or a careful movie recommendation.

Retailers are missing a trick to get an edge over their competitors.