Shopper’s Drug Mart is testing out a new personalized promotional strategy that examines the buying trends of its its rewards program members to target them with discounts on specific products they may want. For example, if a rewards member frequently buys L’Oreal shampoo, Shopper’s uses that information to decide to send them an email with a promotion on L’Oreal conditioner.
Shopper’s isn’t the only business going more personal. I recently read Fraser Denton’s blog post about how Tesco is using surveillance cameras to figure out the age and gender of their customers to better target their promotions. I find it interesting how businesses are moving towards more personalized promotions. As competition heats up, businesses feel the pressure to narrow their marketing strategies specific to the customer, giving him/her a more convincing reason to by the product. However, these personalized strategies can be costly and time consuming. To be successful, huge amounts of data need to be tracked and sorted. In addition, narrower targeting also means that the business may end up ignoring other potential customers that are not in the targeted segment, perhaps leading to a decrease in sales.
Businesses are even personalizing pricing! Click here to find out more
***On a side note, after our class on performance evaluation I realized that the article on Shopper’s mentioned several examples of these evaluation measurements such as front-of-store-sales and consumer’s average basket. These tools will help Shopper’s evaluate whether this is the right promotional strategy and whether the benefits are outweighing the possible costs I mentioned above.
Hollie Shaw, “Shoppers Drug Mart profit rises in third quarter as retailer makes promotions push,” Financial Post, November 12, 2013, accessed November 14, 2013, http://business.financialpost.com/2013/11/12/shoppers-drug-mart-earnings/
Marina Strauss and Bertrand Marotte, “Shoppers reaps rewards of personalization,” The Globe and Mail, November 12, 2013, accessed November 14, 2013, http://www.theglobeandmail.com/report-on-business/shoppers-profit-climbs-on-prescription-sales-growth-long-term-care-gains/article15386322/
Image from: The Canadian Press, Graeme Roy