Customer data bridges the gap between what a convenience-store customer purchased in the past and what they are purchasing in the present. Retailers can see the incrementality that loyalty is providing and understand what kinds of offers to send to each customer, Lana O’Connor, director of loyalty and digital marketing for c-store retailer RaceTrac, Atlanta, said in a CSP webinar featuring several C-StoreTEC advisory board retailers.
Art Sebastian, CEO of NexChapter, Des Moines, Iowa, and chairman of the C-StoreTEC advisory board moderated the webinar, and David Jackson, director of digital marketing at Kwik Trip, La Crosse, Wisconsin, and Lisa Ham, director of merchandising and space planning at Yesway, Fort Worth, Texas, joined O’Connor in the discussion.
- RaceTrac is No. 17 on CSP’s 2024 Top 40 Update to the 2023 Top 202 ranking of U.S. c-store chains by store count. Kwik Trip is No. 12. Tri Star Energy is No. 52 on CSP’s 2023 Top 202 list. Watch for the full 2024 Top 202 ranking in the June issue of CSP magazine and in CSP Daily News.
Maturing the Use of Customer Data
Collecting customer data has been a journey for Kwik Trip, Jackson said, which started around 2010 with its email messaging platform. The chain began with collecting a name, email address and a birth date. A text program came next and then a loyalty program. Throughout these stages, Kwik Trip learned about and implemented segmentation from purchasing habits.
In the last three years, Kwik Trip has launched a customer relationship management software to bring all messaging and segmentation into one platform to streamline that process.
Benefits of Customer Segmentation
Since the launch of its loyalty program, Kwik Trip has relied on segmentation.
The benefits are that messaging is more on par with what guests want to see, and from a business standpoint, outside of better redemptions and engagement, there’s reduced messaging costs because it’s going to a reduced, more targeted set of people.
RaceTrac has shifted in the past couple of years from sending the same offer with the same creative look to everybody. Now, the c-store chain’s goal is driving more incrementality.
“Nine times of 10, we don’t want to send you an offer that we know you’re probably going to purchase anyway, and this time you’re getting it at a discount,” said O’Connor. “That’s what our rewards catalog is for. What we’re trying to do with our offers is drive behavior change, whether it’s an additional visit, trying a new offer or adopting a new program that we have in store.”
The Most Valuable Customer Data
Every chain will have a personal take on what the most important type of data sets are, said O’Connor, but RaceTrac’s strategy spotlights customer motivation.
Loyalty members have different goals, like hoarding points, collecting coupons or gaming the system.
“If you can get to the root of that motivation, then you’re doing a lot to drive your guests to come in more often and buy more from you,” she said.
Once customers are segmented, the RaceTrac team is interested in understanding customers’ points of friction and adding enhancements for a smoother experience to drive conversions.
In Ham’s merchandising-focused perspective, the most valuable data sets are sales, gross profits and units. Using merchandising strategy, Ham wants customers to stay inside the store longer so that they buy more.
Personalization Within Segmentation
Personalization is different than segmentation. It's a step further, and instead of grouping customers based on activity, it targets shoppers at an individual level.
While there can be positives to personalization, there can also be negatives if it’s done wrong, said Ham.
“If you have someone that is extremely against tobacco, for instance, you don’t want to be sending them an offer for tobacco,” she said.
So instead of jumping right into personalization, it’s important to have a strong grasp on segmentation first.
Overcoming Barriers
Executive support can be a potential barrier, but overcoming this challenge lies within breaking it down, building out a timeline and thinking about the return on investment at a step-by-step rate, said Jackson.
Get a translator—someone who can explain the complex technology and how it can help to executives and the team so they better understand what they’re getting into, Ham said.
Another challenge is that consumer behavior is always changing. There is a constant shift in the types of promotions customers prefer.
“Expect the unexpected,” said O’Connor. “Attitudinal, economic and generational factors are all contributing to how people are engaging. It’ll continue to change over the next five-plus years. All we can do from a marketing perspective is be ready to tailor our offers, promotions, creatives, personality from a brand perspective to how we talk to each of these different groups.”
Investing in customer data is a marathon, O’Connor said, but there are rewards throughout the marathon that will happen, according to Jackson. There will be successes along the way, and you’ll be able to “find that ROI [return on investment] even before you get to the finish line,” said Jackson.
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