Ahold USA Meets Its 'Best Customer'

Minneapolis — Recognizing weak identical-store sales and a growing competition in the Northeast, Ahold USA turned to Copernicus Marketing Consulting & Research in December of 2014 to launch a market-based segmentation project that would fuse together shopper-card, third-party and custom-research data to help develop a harmonized single view of the consumer. The partners reunited at the Shopper Marketing Conference & Expo the following October to describe their process that led the retailer to discover its “best customer.”

Access to shopper data hasn’t been a problem for Ahold USA, according to Sharon Eiswert, director, marketing and merchandising. “We have a lot of really great data on our consumers and we’ve always used it well,” explained Eiswert, noting the retailer has high loyalty-card usage rates. “But, what we asked ourselves is how do we start to really use the data as a competitive advantage and how do we start to really know the customer even more so beyond the functional day-to-day measurement and really start to know them as people and tailor our offering to them?”

Prior to this latest segmentation project, the retailer has had three segmentations in place since 2007. One focused on brand loyalty, another on shopper behavior, and the other on price. None of the segmentations, however, really captured the essence of how customers felt about the retailer, Eiswert said.

Thus, Ahold wanted to make sure the new segmentation was based on behavior as well as attitudes. It was also important to be able to link the new segmentation to the company’s database. “A lot of times you hear of people who do these great segmentations and they are based on research, and they roll them out to the whole company and they get inspired around this segment — Sally or Sue or whoever it is — and then they don’t have any other information. They have no way of really acting on that segmentation and really linking it back to, ‘So, what customers fall into that segment and how can I reach them?’”

“It was the SVP of marketing who really believed in this and really has pushed it through across the organization and has gotten buy-in like we’ve never seen before.”

What’s interesting when working with organizations that have big databases such as Ahold is that there are always inconsistencies across the different datasets, said Eric Paquette, Copernicus’ senior vice president and chief operating officer. For example, the brand tracking survey would differ from the database, which would differ from return on investment data. “And it makes people’s hair fall out, right?” Paquette said. “Nobody understands what of this is true and why they’re different.”

The segmentation project led the partners to interview 5,000 grocery shoppers in the trade area to better understand their attitudes. In creating a single view of the consumer, Copernicus also considered behaviors from the database, the existing segmentations and Experian data to turn on the programmatic and addressable digital campaigns.

In the end, the project narrowed down six customer segments, describing in great detail each of their shopping behavior, attitudes and affinity for Ahold overall as well as other competitors.

After much consideration, Ahold selected two segments of the six to go after as their “best customer.” One of the groups was already their most loyal shopper and another was more of a growth target with a lot of potential in the market. “We’ll be doing a training and a roll out plan now in January where we’re going to be sharing this with the entire organization and really getting everyone to buy into this and start really thinking like our best customer and making decisions based on the things that are important to them.”

In order to execute a project like this, Eiswert encourages others to find a high-level executive sponsor within the organization to drive adoption across the business. “In our case, it was the SVP of marketing who really believed in this and really has pushed it through across the organization and has gotten buy-in like we’ve never seen before,” she added.

Involving key business partners throughout the process is also important. Eiswert explained they consulted Ahold executives in merchandising and from the retailer’s online grocery service Peapod, for example, to get an understanding of how they would use this segmentation and make sure “we were building it the right way with the right requirements so that they could use it at the end of the day.”

Finally, she suggests keeping the end goal in mind from the start and finding a vendor who has some proven experience.