Are loyalty cards key to online-to-offline attribution?

Discussion
Photo: @alinabuzunova via Twenty20
Feb 20, 2020
Tom Ryan

Kroger said its self-service advertising platform now leverages three sources — its own customer loyalty program, data science from its media advertising business and Microsoft PromoteIQ — to allow brands for the first time to view in-store and online sales results attributed to advertising campaigns across the grocer’s properties.

With the platform, marketers can sponsor product listing ads and banner display ads on Kroger websites and mobile apps. Kroger applies only 100 percent verified transactions from both in-store and online customers.

“The digital advertising world is plagued with inaccurate data,” said Cara Pratt, VP, commercial and product strategy for Kroger Precision Marketing at 84.51°, in a blog entry. “It has forced marketers to ask tough questions about their media choices. KPM has vowed to be a transparent and accountable media partner to CPGs.”

The new capabilities come as Google in a recent study showed how Google Analytics tapped the loyalty card data of Sephora’s customers in Singapore to show the offline impact of the beauty chain’s online ads. Wrote Google in the study, “Using Analytics 360, the team was able to see from a specific AdWords campaign level which loyalty members made purchases both on the Sephora website and at brick-and-mortar locations.”

Among the findings was that 70 percent of customers who visited the Sephora website before buying in-store did so on the day of purchase. Additionally, more than half of those visitors were on mobile.

Last July, a partnership between LiveRamp and the shopper intelligence platform, Catalina, promised retailers the ability to track and target customers in-store as easily as they do online via clicks. LiveRamp’s identity resolution capabilities would map two-year shopping patterns across about 170 million consumers in Catalina’s retail partner loyalty programs to 390 million digital devices and 85 million households.

“We’ve seen all sorts of data targeted by CPG companies — everything from some transaction data to location data and demographic data,” Grant Ries, CEO of LiveRamp’s B2B arm, told Adweek last year. “But Catalina’s data is much richer, it’s happening in real time, inside stores; it’s actionable, and there’s intent there. And now, they can target that data in a cross-channel way.”

DISCUSSION QUESTIONS: Do you see data from loyalty programs as critical to linking digital advertising to in-store sales? What are the pros and cons of relying on loyalty data for cross channel attribution?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"The short answer is yes, but the benefits are bigger than just advertising. It's about knowing your customer and her preferences."
"Frequent shopper data is a “must-have” for CPG marketers to understand effectiveness of specific digital advertising tactics."
"The better question here is why wouldn’t you see the data from loyalty programs serving as a data bridge to connect different data sources to multiple categories?"

Join the Discussion!

12 Comments on "Are loyalty cards key to online-to-offline attribution?"


Sort by:   newest | oldest | most voted
Suresh Chaganti
BrainTrust
Suresh Chaganti
Co-Founder and Executive Partner, VectorScient
5 months 26 days ago

Loyalty data is an excellent source. But not a silver bullet.

Attribution modeling – determining which marketing channel contributed how much – will never be 100 percent accurate. That’s because data leakages are everywhere. Customers may forget to punch in loyalty program, browse on devices they don’t own, they may block cookies or there could data leakage for any number of other reasons.

Rather the question to ask is, is it possible to get a very good directional sense of what campaigns, channels, and creatives are contributing, and how much this influences the eventual sale? The answer is a resounding yes.

It is also possible to figure out the relative investment mix and the right sequence of campaigns–between digital, e-mail and in-store promos, etc. that gets most ROI.

Neil Saunders
BrainTrust

Loyalty schemes are an effective way of enhancing a retailer’s understanding of how consumers purchase across channels; indeed, it is one of the reasons Target has been pushing Target Circle. However it is not perfect. People forget to scan their cards or apps. Not everyone is a member of the scheme. And so forth. But on balance, it does yield some good data and insights — if retailers know how to use and take advantage of it!

Kai Clarke
BrainTrust

The better question here is why wouldn’t you see the data from loyalty programs serving as a data bridge to connect different data sources to multiple categories? We are in an omni-channel sales age that requires omni-channel marketing to bridge the divide of information and communication. Successful businesses will recognize this and leverage this data early on.

Bob Amster
BrainTrust

Loyalty programs were designed to be able to collect data for specific, known customers and to target in a personalized method to those same customers. Consequently, data collected through loyalty programs is invaluable and yes, critical to linking more than just digital advertising to in-store sales.

Gene Detroyer
BrainTrust

Loyalty programs help identify the very best customers. I am a great believer in the 20/80 rule and I suspect loyalty programs reflect that. And doing it omnichannel is critical.

Who are best customers? Those are the ones contributing to the bottom line. The Sephora example is a good one — check out what I want AT SEPHORA, then go get it. But it’s even better for the retailer that once that customer, let’s say at Sephora, discovers a new product at the store, they buy it again and again online.

As we have said in many discussions, the consumer does not distinguish where he/she bought the product. They will buy the product they want where it is most convenient.

Paula Rosenblum
BrainTrust

The short answer is yes, but the benefits are bigger than just advertising. It’s about knowing your customer and her preferences. A lot of grocers have had that opportunity for years, in a store-based world. Whether they actually use that data or not is another question.

Ricardo Belmar
BrainTrust
The fact is any reliable customer data source a retailer has access to is critical to linking cross-channel and multi-channel marketing campaigns. Loyalty programs by their definition help to deliver data on the retailer’s best customers, typically representing their best 20 percent of customers who may very well be generating the majority of sales (at least for the most successful program). So yes, loyalty program data is absolutely critical — as is the retailer’s own sales data from their POS, external sources like Google Analytics, and various in-store analytics sources from Wi-Fi, door counters, and so on. The issue is really how reliable is each source. No number of sources will achieve 100 percent accuracy — this is about trends, not individual customer activity. The ability to link customers’ browsing habits on your website to their in-store purchase activity is a must to understanding what sells, why it sells, how often it sells, and to what customer segment it sells. The difficulty for most retailers is in analyzing these various sources of data together to… Read more »
Joel Rubinson
BrainTrust

I consult with the Mobile Marketing Association as their attribution expert and also (disclosure) have consulted for Catalina. Frequent shopper data is a “must-have” for CPG marketers to understand effectiveness of specific digital advertising tactics. In addition, it reinforces something that marketers seem to not be as aware of as they should … targeting buyers based on prior shopping patterns can result in ad effectiveness for your addressable marketing that is up to nine times greater! This was proven in white paper research I designed, in partnership with NCS and Viant, called “The Persuadables.” So frequent shopper data is not only integral to ad effectiveness measurement, it is essential to CAUSING much greater ad effectiveness.

Brian Ross
Guest
5 months 26 days ago
Without question, personalization is THE future of loyalty. For the past 30+ years, loyalty cards were the mechanism to engage customers with the goal of delivering improved customer relevance and experience. In today’s increasingly digital world, the power of loyalty remains better understanding customers and delivering personalized, relevant and enhanced value. In that spirit, to rephrase the question from “is data from loyalty programs” critical – the answer is a resounding “absolutely.” The strongest benefit with “data from loyalty programs” is that it’s the purest source of customer behavior – what, where and when they buy and in what channel. The “pro” of loyalty data is that it is the most accurate view of actual behavior. That said, loyalty data is one part of understanding the broader customer view – and a critical part – the con is that it doesn’t provide a holistic view. Other sources are key – including what they didn’t buy (e.g., what products did the search but did not add to cart) and what other information they saw as well… Read more »
Ralph Jacobson
BrainTrust

Suresh Chaganti said is best in his comments here. I see companies leverage “Marketing Assist” metrics that are driving real, tangible ROI for the digital efforts.

James Tenser
BrainTrust

It’s not the loyalty data per se, although that’s valuable too. I think it’s the connectivity that really matters. Attribution is the toughest challenge in promotion marketing today. Sorting out “what influenced this purchase?” is the key to optimizing media spending and optimizing promotion performance.

I appreciate Kai’s terminology: Loyalty programs can indeed serve as a “data bridge” that connects shopper behavior to their prior influences across digital and physical channels. I have called this phenomenon “The Incredible Dissolving Store” several times in the past. (It’s the boundaries that are dissolving, not the relevance of physical retail.) Others have described various “moments of truth” along the meander from awareness to purchase.

Linking those moments — digital, in-store, and at-home — requires some ability to recognize the same shopper at each moment of truth. Opt-in loyalty programs are presently the best available option for accomplishing this.

Until the day shoppers are able to own, control and monetize their own personal data lock boxes, that’s the best option we’ve got.

Sterling Hawkins
BrainTrust

Loyalty data aside, there needs to be some unique identifier to support people in cross-channel activity. And there might not just be one vehicle to get to that unique identifier. A person may use a card in-store, their login on a mobile device and a cookie on their browser. They key is that they all roll to the same user and that there’s value provided back to that user. Collecting all that data is really a value exchange with the consumer; making the (experience, discounts, content, etc.) worth giving up some of their privacy.

wpDiscuz
Braintrust
"The short answer is yes, but the benefits are bigger than just advertising. It's about knowing your customer and her preferences."
"Frequent shopper data is a “must-have” for CPG marketers to understand effectiveness of specific digital advertising tactics."
"The better question here is why wouldn’t you see the data from loyalty programs serving as a data bridge to connect different data sources to multiple categories?"

Take Our Instant Poll

Are there more benefits or drawbacks to using loyalty data for cross channel attribution?

View Results

Loading ... Loading ...