dunnhumby's Retailer Preference Index (RPI) for Leadership in Personalization
“The Grocer That’s Made for Me”
Amazon, H-E-B, and Kroger do personalization best.
Targeted Savings. Frictionless Experience. Localized Assortment. It is what drives personalization, and it is what Amazon, H-E-B, and Kroger do best. Customers feel like these grocery retailers are made for them and reward them with more loyalty ( i.e. a bigger share of their wallets).
We don't define personalization. Customers do.
Table of Contents
Vince Tirelli
Author
Eric Karlson
Creator of Original RPI Model
Executive Summary
- The promise of personalization: As dunnhumby has noted in previous reports, base prices constitute just half of price perception. With the long-term trend of shoppers – across income brackets – demanding lower prices, about a quarter of price perception – personalization is an opportunity for grocers – including regional supermarkets which increasingly compete with EDLP leaders – to better retain and acquire Customers. In other words, personalization provides grocers with a form of agency to battle the “invisible hand” of mass market forces. Personalization matters more today than it did four years ago.
- The dunnhumby approach. The RPI is the only model that explains which grocery retailers are winning – and why – by combining both financial and emotional results. It predicts which grocery retailers are better at loving their current Customers and which grocery retailers receive the most love back. We looked at 65 grocery retailers, ~10,000 American grocery shoppers, and 30+ levers grouped under three main drivers.
- Personalization defined. Made for me. For grocery retailers with millions of Customers, loving each Customer the way each one wants requires navigating the complexities of personalizing each journey. We do not define personalization. Customers do.
- Grocery retailer outcomes. Personalization leaders experience more visits per Customer, fuller shopping carts, and a stronger Customer belief that the grocery retailer is made just for me. Being in the top personalization quartile means better outcomes with each individual shopper, in the geographic footprint the grocery retailer is operating today. For top quartile grocery retailers, this translates to a 14% increase in shoppers with a strong emotional connection, a +41% increase in share of wallet, a 34% increase in online monthly visits per person, and a whopping 131% increase in traffic share in a grocery retailer’s footprint, compared with personalization laggards.
- Personalization leaders. Welcome the triad of drivers: Targeted Savings, a Frictionless Experience, and a Localized Assortment. This is what Amazon, H-E-B, and Kroger do best. They have clear and distinct approaches in how they drive personalization. Whereas Amazon is a peerless leader in Frictionless Experience, H-E-B also excels in Frictionless Experience while being a master in localizing assortment. Kroger, Giant Eagle, King Soopers, and Meijer do well in all three drivers of personalization.
- Driver #1. Targeted Savings. Targeted Savings is the most important driver of personalization and drives 45% of personalization-related grocery retailer outcomes. Smith’s, Winn-Dixie, Kroger, Fry’s, and Giant Eagle offer shoppers the best Targeted Savings. Leaders in this driver do two to three times better than laggards at rewarding shoppers (the feeling of being rewarded with frequent and relevant rewards), helping them save money (via the loyalty program), and making it easy for them to do so (an easy-to-understand program and point redemption).
- Driver #2. Localized Assortment. A Localized Assortment drives 28% of personalization-related grocery retailer outcomes. H-E-B, Big Y, Wegmans, Food City, and Schnucks offer the best Localized Assortment. Leaders in this space perform 1.5-2 times better than laggards at providing shoppers with the right variety of products to meet their needs, local product variety (from local farmers or businesses) and a close connection to the local community. Localization and hyper-localization can help Customers feel like a grocery retailer knows them personally.
- Driver #3. Frictionless Experience. A Frictionless Experience drives 27% of personalization-related outcomes. Amazon, Target, H-E-B, CVS, and Walgreens provide shoppers with the best Frictionless Experience. Leaders in this area perform roughly two times better than laggards at reminding shoppers (usual items, forgotten items, previously bought items, follow-ups), providing relevant products and topics, providing digital ease (making it easier to shop online or via the app), and personalizing both the online and in-store experience.
- Category relevance. Not all categories are created equal. Personalization matters most in baby care, a category Customers are particularly attached to across all three drivers. Personalization also matters in health care, ready-to-eat, fresh meat, and pet care, but their importance varies according to the driver.
- Personalization as a way to reignite the love: As one reads this report and reflects on its findings, it may be helpful to see personalization as a way of recovering the past, when shoppers had a close relationship with the grocery store and its people. Personalization promises a way to re-establish those bonds both instore and online. That it can be done, in part, digitally, is illustrated in the story of Amazon, the founder of digital personalization science. But Customer data science can re-establish those bonds in store as well.
Made for me. A deceptively simple-sounding goal. Yet for grocery retailers who have hundreds of thousands or even millions of Customers, loving each Customer the way each one wants to be loved requires navigating the complexities of personalizing each Customer journey. However, for those grocery retailers who are best-in-class at personalization, the rewards are great. In this report, we prove that better personalization leads to more visits from each Customer, fuller shopping carts in each visit, and a stronger belief from the Customer that this grocery retailer is made "just for me". We also reveal which grocery retailers are best-in-class at personalization, what personalization means to Customers, and which dimensions of personalization should be prioritized to capture a greater share of Customer wallet and a greater share of visits within a given geographic footprint.
The dunnhumby approach
We don't define personalization. Customers do.
What feels like a tailored experience to me is likely to be different to another shopper. That’s why dunnhumby decided to adopt a more holistic, Customer First approach to understanding personalization. We have looked at 30+ levers and other themes to understand what personalization truly means to shoppers, what matters to them, and how grocery retailers perform across all these dimensions. By providing a view of these levers, we aim to empower grocery retailers with the agency and tools they need to satisfy the needs of their shoppers. From Targeted Savings and Frictionless Experience to Localized Assortment – we will get a better understanding of what makes a shopping experience feel more personalized and which of these dimensions has the biggest impact on both the retailer’s emotional connection with their shoppers and their financial performance. See more about this approach in the next section.
This edition of the RPI – the personalization RPI – includes the largest grocery retailers in the industry that sell everyday food and non-food household items. We have included a total of 65 grocery retailers in our personalization rankings, for which we have both financial and perception measures.
Where do our financial data and Customer perceptions come from?
The data in our model is sourced from our survey of ~10,000 American grocery shoppers. While our opinion does not influence the results of the model, our industry expertise in the grocery industry building the model inputs and interprets the results. This expertise (see dunnhumby Customer Engagement and Retail Media sites), along with our Customer First approach in everything we do, ensures the model design and interpretation reflect lessons learned from decades of serving hundreds of grocery retailers, thousands of consumer-packaged goods companies, and billions of Customers, globally.
We also cross-validate our model results with data outside of our model. Specifically, we looked at foot traffic data from Placer.ai and web traffic data from Similarweb to ensure that grocery retailers who rank higher in our approach are driving a higher share of visits and bigger basket sizes. Based on Placer.ai’s geolocation data, we were able to identify the geographic footprint for each grocery retailer and calculate a custom metric for share of foot traffic in that geographic footprint. Similarweb tracks website activity using multiple methods, and we cross-validated our model with their reported data points for each grocery retailer.
What does the personalization model do?
The model is a prediction. It predicts which grocery retailers will have the strongest financial results and strongest emotional bonds with Customers over the long term based on Customer perception of a grocery retailer’s personalization value proposition. More specifically, it predicts a composite measure of success, which includes share of wallet as well as a strength of emotional connection with Customers. In other words, it identifies which grocery retailers are better at loving their current Customers and, in turn, which grocery retailers are going to receive the most love back.
Our rationale rests on Customer needs
The model also provides a rationale for this prediction. Using factor modeling and regression analysis, we identify the dimensions of the personalization value proposition that matter the most for driving financial results and emotional bonds. Our personalization RPI model groups 30+ personalization Levers into three main dimensions. We call these dimensions “drivers” of the value proposition; Customers might recognize them as their “needs”. The personalization preference drivers -- or need states -- we explore in the next section of this report are: Targeted Savings, Frictionless Experience, and Localized Assortment. With the Customer perception scores we have on each grocery retailer on each driver, along with an understanding of the importance of each driver, our model predicts which grocery retailers are best positioned to achieve the strongest share of an individual Customer’s wallet and secure the feeling that the retailer was "made for me".
How is the personalization RPI different from the annual RPI?
Some of you may be familiar with dunnhumby’s annual US Retailer Preference Index (RPI) study, which has been published every January since 2018. The annual RPI study ranks which grocery retailers are best positioned for the long term and why, considering any potential Customer-focused strategy a grocery retailer could take, not just a personalization-focused one. While the personalization RPI predicts which grocery retailers are best positioned to achieve stronger personalization-driven outcomes, with each individual Customer, the annual RPI predicts which grocery retailers are best positioned to achieve stronger long-term sales growth, greater US market share, and stronger sales per square foot. These outcomes can be driven by both optimizing the value proposition for your current Customer base, as well as expanding to new geographies in the US and to new Customers. Superior execution of strategies beyond personalization may be (and are) required.
This is why some grocery retailers who are well-positioned for the long-term in our annual RPI (like Aldi and Costco) and other grocery retailers who are among the fastest-growing in the country for the past 10 to 15 years are absent from the top two quartiles of our personalization RPI (hard discounters like Dollar Stores, Lidl, Grocery Outlet). They have not relied on personalization to drive their growth and instead have relied on driving scale through geographic expansion and other cost-controlling measures, resulting in superior base prices for Customers. While this model differentiates them from existing grocery competition in many geographic footprints -- allowing them to successfully expand to new markets -- it ranks these grocers with a below-average share of Customer grocery wallet and lagging foot traffic share in any given geographic market. As their ability to expand into new markets diminishes in the future, these grocery retailers too will need to look to personalization to drive growth with current Customers. To read our latest annual RPI report, click here. The next version of the annual RPI will be published in January 2024.
What this report is not
The aim of this report is to provide a framework for grocery retailers to improve personalization as a whole – the way Customers define it. And so we take a more holistic approach to personalization than what you will typically find in other reports available on personalization. Loyalty is often used interchangeably with personalization, but as you will discover in this report, it is crucial as just one of the levers a grocer can pull to improve personalization. While our co-founders Edwina Dunn and Clive Humby built the foundation of dunnhumby based on loyalty via a science-led Customer First approach, and while we fully comprehend the importance of loyalty mechanics in, this report does not dive into loyalty mechanics (see image below). Instead, it explores how you (the grocery retailer) can make Customers feel like you are made for them and as a result drives significant outcomes.
Retailers included in the PRPI that are interested in receiving their individual banner profiles can place a request below.
Why should you care?
Traditional, regional supermarkets are in a decades-long fight to hold onto their Customers. We have seen major discounters and clubs make their way to the top of our annual RPI, the industry-leading metric for grocery retail brand equity. That is not a surprise. Their customer value proposition is highly focused on helping Customers save money, and saving money is the one thing that matters to most shoppers. That’s been true the past 40 years in the grocery industry, a time that saw supermarkets’ share of US grocery sales nearly cut in half, declining from approximately 70% of sales to just under 40%. That has also been true for the past 110 years in the grocery industry, and it will continue to be so for decades to come. Our report, Grocery 2053 provides a framework for adapting in the coming 30 years and increasing your “readiness for 2053.”
Of all the ways to save money, base prices account for a massive 50% of price perception. Being able to position yourself competitively on base prices leads to scale, and more scale leads to better base prices, creating a virtuous cycle that results in increased market share and sales growth. It is simple grocery retail math. But not all grocery retailers have the scale of national chains or mega-regionals to win on base prices. The truth is, for the best of them, they do not need to.
In our 2022 inflation edition of the RPI, we showed that lead “conductors,” defined as grocery retailers who are best in class at orchestrating the remaining half of price perception while minimizing gaps to national chains in base price, can experience as much long-term growth as base price leaders. These lead conductors tend to be regional, traditional supermarket chains that are using best-in-class approaches to optimizing assortment, promotions, and pricing.
This is where the story gets interesting. We have also shown in our recent annual US RPI (2023 edition) that within price, promotions, and rewards, personalized levers now account for a quarter of price perception whereas that number was below 10% in 2019. This means the competitive advantage that regional supermarkets had over national chains deserves a second look. The increasing importance of personalization since the pre-pandemic opens the door for regional supermarkets to stall or even reverse their decades-long market share at a time when the supercenter, club, limited SKU, and digital formats have grown.*
However, national chains on both ends of the price-quality spectrum are also taking notice of the increasing importance of personalization in recent years. You only have to scan news headlines to see national and mega-regional grocery retailers -- from Dollar General and Family Dollar to Sprouts -- announcing build-outs of digital capabilities or loyalty programs, explicitly to personalize the shopper experience. This means regional supermarkets who are leaders in personalization today cannot rest on their laurels, because leaders in base price or quality are coming for their competitive advantage.
In the spirit of personalization, this report will provide a framework not only for grocery retailers looking to lead the market in personalization, making it their lynchpin to a successful strategy, but also for those who are in the earlier phases of their personalization journey and are trying to understand where to focus limited resources. Choose your own personalization adventure.
Recovering the past for the future: Finally, as one reads this report and reflects on its findings, it may be helpful to see personalization as a way of recovering the past, when shoppers had a close relationship with the grocery store and its people. Personalization promises a way to re-establish those bonds both instore and online. That it can be done, in part, digitally, is illustrated in the story of Amazon, the founder of digital personalization science. But Customer data science can re-establish those bonds in store as well.
What is personalization and why does it matter?
Many definitions of personalization exist:
- The Oxford English dictionary defines it as “the action of designing or producing something to meet someone's individual requirements.”
- Gartner defines it as “a process that creates a relevant, individualized interaction between two parties designed to enhance the experience of the recipient.”
- McKinsey defines personalization as “when seller organizations use data to tailor messages to specific users’ preferences.”
- The Adobe Experience Cloud defines it as “the process of using data to target and retarget leads with a brand message that speaks directly to specific Customers’ interests, demographics, and buying behavior."
- Salesforce defines personalization as “the act of tailoring an experience or communication based on information a company has learned about an individual.”
The reality is that each of these definitions misses the mark. The very nature of personalization makes a single definition elusive. At dunnhumby we always prefer to take the Customer’s point of view. Personalization is a feeling the Customer has… that “the retailer was made for me” or that “the retailer knows me and my needs personally” - how we measure the emotional bond with Customers. In addition to the increased share of Customer wallet today, the personal emotional connection grocery retailers have with their Customers is the property of grocery retailers who are best-in-class in personalization.
What gives Customers the feeling of Personalization?
The bigger picture on personalization
Because personalization is part of a bigger picture and is so intricately interwoven with the overall Customer experience, we have also looked at contextual data points we believe have a significant impact on a grocery retailer’s ability to personalize. We will tackle some of these data points throughout this report and their relationship to personalization: grocery and third party subscription services, most important channels for making grocery decisions; recent grocery retailer advertisements across various platforms; dominant shopping habits; and the role distinct categories play in personalization (hint – not all categories are created equal).
The Customer personalization drivers
The Customer shops in mysterious ways, and it is not any different to how Customers perceive personalization. To demystify personalization, we have identified:
The personalization needs that matter most to Customers.
How grocery retailers perform across an extensive set of personalization needs (drivers).
Which of these needs drive the biggest share of wallet and emotional connection with shoppers.
If this is the way the Customer holistically thinks about personalization, then this is how we think about personalization.
Customers seek to maximize their benefits and minimize their costs, across all of their need states. Retailers have a variety of levers they can pull to deliver their customer value proposition.
Model approach: Factor analysis of 30 performance perception ratings for all retailers in this study was performed to determine the Drivers
Welcome to the triad of personalization where the Customer is the ultimate beneficiary: Targeted Savings, Frictionless Experience, and Localized Assortment.
Meeting these Customer needs can make Customers feel like they are at the center of your universe. If you succeed in all or in the most important of these personalization drivers, Customers will feel like you (the grocery retailer) know their needs personally and are “made for them.” And for this, they reward you with their loyalty and a bigger share of their wallet.
Get the basics of this personalization relationship right and you might be on your way to building a healthy and long-lasting marriage with your Customers.
Quartile outcomes
Retailers with better Personalization scores have better results on multiple critical outcomes
Source (in order of charts): 1) dh Personalization survey, August 2023, n=10,641 US grocery shoppers. 2) Online, Similarweb. Brick and Mortar, dh Personalization survey. 3) Placer.AI. 4) dh Personalization survey.
Being in the top personalization quartile means better outcomes for grocery retailers with each individual shopper, in the geographic footprint you are operating in today.
Saving money and rewarding shoppers matters most to driving better long-term results for retailers; among benefits, customers are least likely to trade-off on a frictionless experience
Customers and grocery retailers alike face trade-offs when striving to personalize their shopping experience. Targeted Savings is the biggest driver and based on what we have learned about the primacy of saving money in our annual grocery RPI study, that is not a surprise. As Customers seek benefits, they are primarily preoccupied with minimizing costs.
Source: dh RPI survey database, Oct 2021 – Nov 2022.
Understanding what the drivers mean
Our Personalization RPI model explains 70% of the variance in personalization outcomes
The model looks at the composite score of personalization outcomes – share of wallet and emotional connection -- and predicts a personalization score for each grocery retailer. We do that by looking at how Customer perceptions across the three personalization drivers explain the variance in these outcomes.
With an R-squared value of .67 (anything above 0.5 or 0.6 is considered significant in predicting behavior), this means our personalization model – Targeted Savings, a Frictionless Experience, and a Localized Assortment – explains almost 70% of the variance in personalization outcomes.
Targeted Savings unlock better personalization. Leaders in leverage a combination of rewards, savings and ease.
For a deeper look at what it means to be a Targeted Savings Leader, see the What drives Targeted Savings section. Targeted Savings drives about half of grocery retailer outcomes and alone can have a significant impact on driving personalization for Customers, illustrated by a higher R2 when compared with Frictionless Experience and Localized Assortment. The R2 is a measure of the strength of association between Targeted Savings and a combined metric of share of wallet and emotional connection.
Frictionless Experience unlocks better personalization. Leaders in leverage a combination of reminders, relevance, ease and following up.
For a deeper look at what it means to be a Frictionless Experience Leader, see the What drives a Frictionless Experience section. Frictionless Experience drives about a quarter of grocery retailer outcomes and can have a significant impact on driving personalization for Customers when combined with other drivers.
Localized Assortment unlocks better personalization. Leaders in leverage a combination of variety and connection to the local community.
For a deeper look at what it means to be a Localized Assortment Leader, see the What drives Localized Assortment section. Localized Assortment, like its counterpart Frictionless Experience, drives about a quarter of grocery retailer outcomes. It can have a significant impact on driving personalization for Customers when combined with other drivers like Targeted Savings and a Frictionless Experience.
Retailers included in the PRPI that are interested in receiving their individual banner profiles can place a request below.
Amazon, H-E-B, and Kroger have the strongest Customer value propositions in a 1st quartile dominated by supermarkets
Source: Retailers ranked by RPI score, which is a result of dh’s RPI model. Customer perceptions input into the model were from dh RPI survey database, August 2023, n=10,641 US grocery shoppers.
Each retailer’s perceptions are among past four week shoppers of the retailer. *Rankings subject to slight change
Retailer Rankings and Positioning Across Levers
Most personalization leaders do well at rewarding Customers and helping them save money (Targeted Savings). Seventy percent of those in the top-quartile of the personalization RPI ranking also position themselves in the top quartile for Targeted Savings (+ a combination of other drivers).
Fifty percent of leaders also positioned themselves in the top quartile for Frictionless Experience, ~25% for Localized Assortment.
Source: Retailers ranked by RPI score, which is a result of dh’s RPI model. Customer perceptions input into the model were from dh RPI survey database, August 2023, n=10,641 US grocery shoppers. Each retailer’s perceptions are among past four week shoppers of the retailer. *Rankings subject to slight change
Position across personalization customer need states
That said, there are clear, distinct strategies across grocery retailers and trade-offs that are being made. Amazon is so dominant in Frictionless Experience -- outdistancing Target by a wide margin -- that their score in Frictionless Experience overcomes their below-average positioning in the other two drivers. H-E-B -- a leading regional which has twice held the top ranking in our overall RPI -- also excels in Frictionless Experience while being masters of Localizing Assortment. Kroger, Giant Eagle, King Soopers, and Meijer do well in all three personalization drivers. The rankings illustrate that there are different approaches to market leadership, there are different personalization engines, and that there are levers that grocery retailers can pull (loyalty program, great digital capabilities, great store associates, or laser-sharp understanding of the needs of each market). To win, retailers must build world-class engines in one or all of these to achieve market leadership in personalization.
Source: Retailers ranked by RPI score, which is a result of dh’s RPI model. Customer perceptions input into the model were from dh RPI survey database, August 2023, n=10,641 US grocery shoppers. Each retailer’s perceptions are among past four week shoppers of the retailer. *Rankings subject to slight change
All quartile cost versus benefit map (60)
The top quartile grocery retailers tend to outperform the rest of the market on benefits, costs, or -- even more commonly -- both. Over-performing on both sides of the value equation leads to superior financials rather than over-performing on just one side of the equation.
*Benefits = Frictionless Experience and Localized Assortment
Costs = Targeted Savings
Top quartile value propositions earn top quartile outcomes , either in emotional connection or on some financial metric
Source in order of columns: 1) Placer.AI. 2) dh Personalization survey, August 2023, n=10,641 US grocery shoppers. 3) Similarweb. 4) Edge Essential & Similarweb 5 and 6) dh Personalization survey.
Amazon – a company that pioneered digital personalization way back in 1999 -- took the #1 spot in Frictionless Experience, the driver that is the most correlated to the overall emotional score. So it’s no surprise they trail only H-E-B in driving the belief the grocery retailer is “made for them.” However, Amazon ranks in the bottom half in share of Customer grocery wallet, so this begs the question… are they really a personalization leader if they trail many other grocery retailers in becoming the leading destination for individual Customer spend?
Of course, given Amazon’s narrower department range -- focused mostly on driving sales in health and beauty, pet and home care, and packaged food -- you’d expect them to capture a smaller share of a consumer’s grocery budget than a supermarket that offers all those departments and more (perishables, ready-to-eat, alcohol and dairy among them). In fact, when controlling for the number of departments offered, Amazon is among the share of wallet leaders. Compared with their cohort of similarly limited department range grocery retailers – drug, dollar stores, and specialty/fresh-focused grocery retailers like Sprouts and Fresh Market – Amazon easily outperforms that group in share of wallet. And, on a metric of share of wallet / departments shopped, Amazon is on par with other personalization leaders (Kroger, Ahold banners, and H-E-B). Amazon is among the best at doing the most with what they offer, based on personalization leadership
Amazon’s share of grocery budget captured exceeds expectations more than any other retailer, given the narrower department range they offer
Amazon ranks 5th in the US efficiency of capturing share of grocery wallet, in a similar place as many Kroger and Ahold banners, which dominate the top in this measure, along with HEB
Channel differences
Overall Amazon, top performing supermarkets (the 28 out of 41 who positioned themselves in the top 2 quartiles), and mass and drug retailers tend to drive more overall personalization than their counterparts: warehouse clubs, specialty grocery retailers, discounters, and dollar stores. Drugstores take the lead, as a group, in Targeted Savings (followed by supermarkets) and perform well in Frictionless Experience. The portrait looks different for Localized Assortment where supermarkets and specialty grocery retailers drive personalization.
Source: Retailers ranked by RPI score, which is a result of dh’s RPI model. Customer perceptions input into the model were from dh RPI survey database, August 2023, n=10,641 US grocery shoppers. Each retailer’s perceptions are among past 4 week shoppers of the retailer. *Rankings subject to slight change
It seems like dollar stores are listening. Family Dollar launched its own personalization program this October with an “evolved rewards experience” and “redesigned wallet feature.”
“At Family Dollar, we wake up every day focused on how we can help our shoppers do more and save more, and this app is one more way we’ll be able to deliver on that promise,” said Emily Turner, chief marketing officer at Family Dollar’s parent company Dollar Tree in a recent interview with Progressive Grocer. “We believe this new user experience will not only appeal to our Customers, but to brands who want to promote their products to our millions of Customers through Chesapeake Media Group, our retail media network.”
“We are investing across the enterprise to make shopping with us even easier and more enjoyable,” added Bobby Aflatooni, CIO at Dollar Tree. “The redesigned Family Dollar app reflects the Customer-centric approach we’ve applied to our digital roadmap to improve the shopping experience for our loyal shoppers and new Customers alike.”
In the specialty channel, Sprouts is also looking to expand its loyalty program. Its lighter, current program covers about 13% of Sprouts Customers.
In a recent interview with Grocery Dive, Chip Molloy, chief financial officer at Sprouts, said the specialty grocery retailer is looking to have a “real” loyalty program that will provide real-time data and insights on shoppers up and running by the end of 2024.”
So, what drives Targeted Savings, Frictionless Experience, and Localized Assortment?
Retailers included in the PRPI that are interested in receiving their individual banner profiles can place a request below.
Smith’s Food and Drug, Winn-Dixie, Kroger, Fry’s, and Giant Eagle are the grocery retailers who are offering shoppers the best Targeted Savings.
Source: Retailers ranked by RPI score, which is a result of dh’s RPI model. Customer perceptions input into the model were from dh RPI survey database, August 2023, n=10,641 US grocery shoppers. Each retailer’s perceptions are among past four week shoppers of the retailer. *Rankings subject to slight change
Let us look at the levers that define Targeted Savings.
All three personalization drivers matter in making a Customer feel like you (the grocery retailer) are "made for them” and driving a bigger share of their wallet. In fact, Targeted Savings is the biggest driving factor of personalization as a whole.
Targeted Savings account for 45% of personalization-driven outcomes for grocery retailers, and it is easy to see why. Customers are continuously looking to maximize rewards and minimize costs. This is what Customers told us matters to them:
- Rewards: How much Customers feel “like they are being rewarded for shopping with a grocery retailer,” and how “significant, relevant and frequent those rewards are,” play a big part in Targeted Savings.
- Savings: How much money a loyalty program can save Customers also matters to shoppers.
- Ease: How easy it is to understand the loyalty program -- and to earn and redeem points or rewards -- can be equally as important in driving Customer perceptions of Targeted Savings.
We also see in our data that discounts on items Customers buy regularly, and receiving promotions when Customers need them the most, are strongly correlated with Targeted Savings.
Customers are understandably more attached to the costs side than they are to the benefits side in the overall personalization equation. Great loyalty and rewards programs are the driver that can help grocery retailers the most with personalization. A few noteworthy exceptions in our top 10: Amazon and H-E-B were able to offset their low performance in Targeted Savings (in the 3rd quartile) by performing outstandingly well in Frictionless Experience and Assortment.
Most other top quartile grocery retailers pack a punch by positioning themselves in the top quartile of Targeted Savings and a combination of the other two drivers. In grocery shopping, nothing says “I love you” like helping someone save money.
“I love Albertson’s loyalty reward program. It offers the best rewards and sales discounts every week, and they always honor the reward even when the product is not available (sold out) by issuing a rain check. The loyalty program is tied to my phone number, so it is easy to identify myself at checkout (no need to carry a plastic loyalty ID card). Overall, Albertson’s loyalty reward has the best value compared to its competitors.”
- Customer quote from our personalization RPI survey
A loyalty program is one of the most tried and true ways of driving personalization with rewards, savings, and general ease. A good loyalty program will ensure the delivery of personalization through targeted savings. But it is not the only way.
Expanding a loyalty program can also be about expanding the variety of products that fall under it. Giant Foods is now allowing pharmacy patients to claim rewards. Customer receive 100 Flexible Rewards points on every transaction that includes prescriptions and immunizations at Giant Pharmacy. This speaks to the growing importance of affordable health and wellness, a subject we covered in Grocery 2053, how grocery retailers can better position themselves with shoppers for decades to come.
Loyalty users are worth more to grocery retailers as loyalty is growing more important to shoppers.
Looking at the data from wave four of our Consumer Trends Tracker, we know that: “80% of shoppers use at least one grocery loyalty/rewards program, and that 16% of them are heavy users (actively engaged with three or more programs). These heavy users are more valuable than light users, spending on average $79 more on groceries each month. The percentage of shoppers that say it is very or extremely important that a grocery retailer sends relevant information or coupons/offers has jumped 5% (to 52%) in our fourth wave of the Consumer Trends Tracker. The number of shoppers frequently redeeming loyalty coupons/deals rose by 6% YoY (now at 44%).”
We can only expect targeted savings and loyalty to become increasingly important in the future.
"We are very happy to be able to offer a reward program that will benefit the patients in the communities we serve. Providing access to quality health care and addressing health care equity are Giant Pharmacy’s main goals; with the addition of the Flexible Rewards program, this is a win for everyone."
- Paul Zvaleny, Giant’s director of pharmacy operations
Position across levers
Targeted Savings leaders consistently do better at rewarding shoppers, helping them save money and making it easy for them to do so. In fact, they do so two to three times as much as laggards.
Source: Retailers ranked by RPI score, which is a result of dh’s RPI model. Customer perceptions input into the model were from dh RPI survey database, August 2023, n=10,641 US grocery shoppers. Each retailer’s perceptions are among past four week shoppers of the retailer. *Rankings subject to slight change
Savings and rewards
“Kroger always refreshes their discounts/ coupons/sales every week and they update on the app. They always have different rewards but are most of the time relevant to me and our household (e.g., fuel points, where I could earn points that will help minimize my gas expenses).
“Kroger meets my needs the most because they offer coupons--sometimes on paper--that are very helpful towards my decision for shopping there. They also allow coupons to be used up to five times on a lot of items throughout the month and items can be mixed and matched instead of always being used over and over again on the same items.”
“I have always shopped at Food4Less because their prices are cheaper than the other two stores in my area. They are also closer to my home. They have a reward program, which offers coupons on some items, and I take advantage of them when there is something that I would be buying anyway.
Ease
“Schnucks usually has things that are discounted or on sale that I tend to use pretty frequently. Their rewards program is exceptionally easy to implement, and I never miss the opportunity to take advantage of it.
- Customer quotes from our personalization RPI survey
Retailers with better Personalization scores have better results on multiple critical outcomes
Source (in order of charts): 1) dh Personaliation survey, August 2023, n=10,641 US grocery shoppers. 2) Online, Similarweb. Brick and Mortar, dh Personalization survey. 3) Placer.AI. 4) dh Personalization survey.
In turn, this translates to (a) better traffic share for these grocery retailers, (b) Customers spending a bigger share of their wallets and more visits both online and in-store. As we’ll see, the impact on the emotional bond will be even clearer with the other drivers of personalization.
TOP 5 Retailers by Retailer Levers
Giant Eagle is the best retailer at rewarding shoppers and making it easy to earn and redeem points in the loyalty program. Smith’s scores best in terms of a loyalty program that helps them save money and the significance, relevance, and frequency of rewards. Kroger has the easiest-to-understand loyalty program.
Base price perception’s impact on Targeted Savings
While base price perception is not part of the Targeted Savings driver, it has a clear relationship with the level of savings Customers feel a loyalty program provides. This logically makes sense -- base price is the starting point from which Targeted Savings from a loyalty program begins. However, grocery retailers who are trying to score among best-in-class in Targeted Savings are giving themselves a big handicap to overcome if their base price perception is too far behind.
Eight of the top 10 regional supermarkets in base price perception are also in the top 10 in Targeted Savings (80% chance of being best-in-class in Targeted Savings perceptions). Of the 27 other grocery retailers not in the top two in base price perception, only two are in the top 10 in Targeted Savings (7% chance of being best-in-class in Targeted Savings perceptions).
Additionally, you can't look at Targeted Savings perceptions alone to know whether a loyalty program is underperforming or over performing. You must also consider a grocery retailer's base prices, the aforementioned starting point. Some grocery retailers (grocery retailer A) are able to achieve Targeted Savings perceptions comparable to grocery retailers with superior base price perception (grocery retailer B). Neither grocery retailer achieves best-in-class Customer perceptions in Targeted Savings, but it is for different reasons. For grocery retailer A, they are handicapped by their base price perception, while grocery retailer B's loyalty program is underperforming given its base price perception, so the issue for them may truly lie in loyalty program execution.
Base price perception has a clear relationship with how much savings customers feel a loyalty program provides
You must consider a retailer’s base price perception starting point when evaluating the ability of a loyalty program to deliver Targeted Savings
Category relevance
Baby care is where Targeted Savings matter most, followed by Health Care and RTE
Baby care is the category where all personalization drivers matter most. That is not a surprise. Through the work we do with our clients, we have identified baby care as one of the categories with the highest emotional engagement. Targeted Savings also matters for health care products, ready-to-eat, fresh meat, packaged food and pet care.
Retailers included in the PRPI that are interested in receiving their individual banner profiles can place a request below.
Amazon, Target, H-E-B, CVS and Walgreens provide shoppers with the best Frictionless Experience.
Source: Retailers ranked by RPI score, which is a result of dh’s RPI model. Customer perceptions input into the model were from dh RPI survey database, August 2023, n=10,641 US grocery shoppers. Each retailer’s perceptions are among past 4 week shoppers of the retailer. *Rankings subject to slight change
Let’s look at what levers define Frictionless Experience
Providing a Frictionless Experience drives nearly 30% of personalization-related outcomes for grocery retailers. Unlike Targeted Savings -- which are more closely tied to rewarding shoppers and helping them save money -- a Frictionless Experience is about making the omnichannel shopping experience more relevant to Customers while making the overall experience easier and personalized to their needs.
Making an experience feel personalized will mean different things to different Customers. For many Customers, a Frictionless Experience will mean one of the following:
- Reminders and follow-up: “when to buy something again,” “my usuals,” “forgotten items before I check-out,” and “Follows up with me after I visit.”
- Relevance: “suggesting relevant substitutes” or “relevant product recommendations” or even “timely communications on topics I care about.”
- Digital ease: As in Targeted Savings, ease matters. “Easy ways to shop online” and “app makes shopping easier” both contribute to driving a Frictionless Experience.
- The instore and online experience: “The online shopping experience feels personalized to my needs” and “website/app makes my shopping experience in the physical store better.”
Some grocery retailers successfully choose to focus on assisting shoppers during their experience to foster a relationship with them and drive better outcomes. Indeed, Amazon and H-E-B have successfully positioned themselves beyond helping Customers save money through Targeted Savings. Instead, they have positioned themselves as the “friend” or “partner” that helps shoppers during their shopping experience, and by making Customers feel like the overall experience is personalized to their needs by doing so.
The mix of relevance, ease, and presence throughout the whole purchase process (combined with the other drivers) has proven to be a winning strategy with Customers.
Drugstores have an advantage in providing a Frictionless Experience. Having a pharmacy, and that one-to-one relationship with a pharmacist, can drive a big part of overall personalization.
“CVS/Longs have great Customer service and knows the entire family by being addressed by last name (Mr or Mrs). Regardless of which of the two we regularly shop at. It does help to get the RX filled at them because they are helpful on recommendations on products we need on an ongoing basis. They made us feel part of the community and again their Customer service is by far superior.
- Customer quote from our personalization RPI survey
But there is another reason this grocery retailer scores high on personalization:
“The CVS in Big Stone Gap number one is very friendly, number two they know me by name and are very personable, number three they offer coupons when I do not have any if there are extras, and number four they help me with the coupons on my phone because I am not very tech savvy. CVS is on the top of my list right now even though they are a little higher priced than most places, their rewards do come in handy.
- Customer quote from our personalization RPI survey
Ultimately, shoppers are looking for relevance and an overall aided experience when shopping:
“I can find my shopping history on Walmart’s app and relevant recommendations on items similar to or matching what I usually purchase from this store. I'm not a part of any reward program but through the store’s app I am able to discover products relevant to my most purchased items that are on sale or discounted.
- Customer quote from our personalization RPI survey
The Kroger/Instacart partnership illustrates the increasing importance of providing an omnichannel Frictionless Experience:
“Omnichannel is bringing multiple channels together so that Customers can shop both online and in store, but that’s very functional...Seamless is about how you make people feel. Seamless is giving Customers what they want, when and how they need it, removing friction.
- Jody Kalmbach, Group VP, product experience at Cincinnati-based Kroger
Helping Customers build their basket and facilitating the shopping experience is one of the benefits a Frictionless Experience can provide:
“There's a lot of complexity that goes into that which is personalized. It's helping that Customer build that basket based on what we already know about them. The personalization is not just about feeding back what you told us as a consumer. It is about us being able to predict what we think you're going to need, right? And that can be around the frequency that you might need a product. It can be around new items that are coming to market.
- Jody Kalmbach, Group VP, product experience at Cincinnati-based Kroger (at Grocery Tech)
Personalized content is also a key lever of a Frictionless Experience. It is why Walmart is investing in AI language models. In a recent article in Winsight Grocery Business, Walmart CEO Doug McMillon said that strengthening Walmart’s ability to personalize content with generative AI for ‘Customers effectively still living in an EDLP world’ is a “winning strategy".
Frictionless experience quartiles
Position Across Levers
Source: Retailers ranked by RPI score, which is a result of dh’s RPI model. Customer perceptions input into the model were from dh RPI survey database, August 2023, n=10,641 US grocery shoppers. Each retailer’s perceptions are among past four week shoppers of the retailer.
Source: Retailers ranked by RPI score, which is a result of dh’s RPI model. Customer perceptions input into the model were from dh RPI survey database, August 2023, n=10,641 US grocery shoppers. Each retailer’s perceptions are among past four week shoppers of the retailer.
Frictionless Experience leaders perform roughly two times better than laggards at reminding shoppers (usual items, forgotten items, previously bought items, follow-ups), providing relevance (products and topics), making it easier to shop online or via the app, and improving the online and in-store experience by making it more personalized to the needs of shoppers.
Relevant topics
“I'm so impressed with Kroger because they send us a packet of coupons each month that are specific to those products that we have actually purchased in the prior few months. In addition, several times per year they send us a magazine with recipes as well as additional coupons specifically selected based on our shopping choices in the prior months.
Relevance and reminders
“The retailer that I shop at that knows my household the best is Walmart. Kroger does a good job, but Walmart is the best. They frequently recommend products we need, even if we forget them! They have incredible Customer service, follow up after orders, and always provide what my household needs.
Reminders, relevance, and ease
“Food Lion does a better job at getting to know me and my household needs. I say this because they have my history of items that I buy every month in one spot which I love. Also, they send me notifications from the app about items that I may like because of my recent purchases.
Relevance and digital ease
“Fry’s does the best job of personalizing to me. They do this via tracking my purchases and then sending me coupons in the mail or digital coupons that match to my preferred products that I buy frequently. I am also able to select my favorite products on their website and have it be saved to my shopping list.
Online experience
“H-E-B has everyday low prices and weekly sales that usually have a few items that I need or want. When browsing the app to place an online order to be delivered, or just researching an item, they will show the item I usually purchase and its details. This makes my shopping faster when I use this situation. If you are looking at items to purchase, the app will tell you if there is a coupon associated with that item, which is helpful to save money.
- Customer quotes from our personalization RPI survey
Grocery retailer outcomes
Retailers with better Personalization scores have better results on multiple critical outcomes
Source (in order of charts): 1) dh Personaliation survey, August 2023, n=10,641 US grocery shoppers. 2) Online, Similarweb. Brick and Mortar, dh Personalization survey. 3) Placer.AI. 4) dh Personalization survey.
Grocery retailers who lead in Frictionless Experience perform better across all outcomes: better traffic share for these grocery retailers, more online monthly visits (average number of online visits per unique visitor), and a stronger emotional bond with shoppers. Frictionless Experience has a stronger correlation with emotional connection than the other two drivers, which are more correlated to share of wallet.
TOP 5 Retailers by Levers
Amazon is consistently #1 across many of the Frictionless Experience levers: ease of shopping, retailer app, online experience, reminders, follow-ups and relevance. Target takes the #1 spot for improving the in-store experience thanks to its website/app and CVS leads in sending timely communications on relevant topics. All these levers together create a Frictionless Experience.
Baby care is where a Frictionless Experience matters most, followed by RTE and pet care
Baby care -- followed by ready-to-eat, pet care, health care and fresh meat -- is the category where a Frictionless Experience matters most.
Retailers included in the PRPI that are interested in receiving their individual banner profiles can place a request below.
H-E-B, Big Y, Wegmans, Food City, and Schnucks offer the best Localized Assortment.
Source: Retailers ranked by RPI score, which is a result of dh’s RPI model. Customer perceptions input into the model were from dh RPI survey database, August 2023, n=10,641 US grocery shoppers. Each retailer’s perceptions are among past four week shoppers of the retailer. *Rankings subject to slight change
Keep reading to find out what levers define a Localized Assortment.
At the end of the day, when Customers interact with you (the grocery retailer), they are ultimately trying to satisfy a need, and that need is to procure a product (and a service in some cases). Customers need to feel that the assortment too is personalized to their needs. There are many ways to make the assortment feel personalized to a shopper’s needs and it is not only about the products themselves:
- Variety: "Right product variety to meet my needs" is a big one. In our annual RPI*, Quality is the second driver and comes right after price, promotions, and rewards in its ability to drive outcomes. Variety means different things to different Customers and the need for it varies across departments and categories.
- Local: "local product variety" and "local community connection" can help Customers feel like a retailer is made for them. Localization and hyper-localization can indeed help Customers feel like a grocery retailer personally knows them and their needs. It is a well-researched and established fact that an individual’s sense of identity is often tied to a sense of place. In today’s impersonal global and/or national retail environment, localization can make the assortment feel personal. And local brands are one step closer to your shopper.
Knowing your Customers and the right variety can help drive a Localized Assortment for shoppers and drive nearly 30% of financial and emotional outcomes.
H-E-B, for example, ranks first in being able to offer a Localized Assortment. Combined with a strong showing in Frictionless Experience, Localized Assortment has helped increase H-E-B’s relevance in the eyes of Customers and has helped this grocery retailer make it to 2nd spot in our personalization Retailer Preference Index.
Combined with other personalization drivers, tailoring stores and their assortment to local needs, and getting involved in the local community, can show Customers you care about them and can help drive a Localized Assortment.
“I think H-E-B has a very good idea what Customers need, and they tailor their stores to their surrounding areas. In my Hispanic neighborhood I can find more chiles, masa, and other Hispanic foods than at an H-E-B in a different location. And they help out our communities in a meaningful and direct way. They come during hurricanes. I will spend more at H-E-B because I know they care about us.
- Customer quote from our personalization RPI survey
The importance of having a Localized Assortment has been recognized throughout the grocery industry. In a recent press release, Kroger announced that following its merger with Albertsons, it will increase local products in store by 10% or 30 new products per store. “Local farmers, bakers, and producers are important parts of our Fresh for Everyone brand promise,” Kroger Chairman and CEO Rodney McMullen said. “Every local product we stock has a unique producer with their own story standing behind it. Since the beginning, this merger has been about growth – and we look forward to inviting our local suppliers to grow alongside us. We are dedicated to supporting the innovation that only a small business owner can create.”
“From Stemilt cherries in Washington and Sun Pacific citrus in California to Talbott Farms Palisade Peaches in Colorado and Southern Press blueberries in Georgia, we know just how important local products are to our Customers,” said Stuart Aitken, senior vice-president and chief merchant and marketing officer of The Kroger Co. “Our Customers know we offer the freshest local products, and they will ask our teams when their favorite seasonal items will be on shelves. We are excited to provide more opportunities for local producers to grow their businesses.”
Localizing assortment and serving local communities drives personalization. And that is what the Giant Company’s omnichannel and hyper-localization strategy is all about. It has doubled its number of local suppliers over the past five years, expanded its private brand assortment, and developed new formats.
“It’s all about the data we can personalize,” asserts John Ruane, Giant Company’s president. “We do a lot of it now, but we need to do more of it in the future: getting to know the Customer, the communities we serve, being able to build a plan that we can scale, but also at the same time we can localize. And we have done a lot of good work around localization.”
Giant Eagle, which ranks four in the overall RPI, performing particularly well in Localized Assortment (#8) and Targeted Savings (#5), and a 2nd quartile performance in Frictionless Experience. The personalization triad strikes again.
Localized Assortment quartiles
Position Across Levers
Source: Retailers ranked by RPI score, which is a result of dh’s RPI model. Customer perceptions input into the model were from dh RPI survey database,
August 2023, n=10,641 US grocery shoppers. Each retailer’s perceptions are among past 4 week shoppers of the retailer.
Localized leaders perform 1.5-2 times better than laggards in providing shoppers with the right variety of products, local product variety (from local farmers or businesses) and connecting closely to the local community. Together, these levers drive a Localized Assortment, better overall personalization and grocery retailer outcomes.
Variety
“H-E-B seems to know what I need at just the right moment. Nearly every time I go there it seems they have deals on a specific product I am looking for. They also understand my personal needs and I feel that I can share almost everything with the staff members.
“Natural Grocer has organic and natural products that appeal to me, in an environment that is committed to this focus. That feels tailored to how I like to eat and products that I use. Also, the employees in their supplement department are knowledgeable about the products, so I feel like I can learn there and receive good recommendations. They also offer things like nutrition classes, and that feels relevant to my life.
“Sprouts is the best at providing the best shopping experience that is tailored to my needs and preferences because they sell the freshest, organic, non-GMO products. I can find things I usually can’t find at any other grocery store.
Local variety
“Schnucks is a local company based in the city where I live and so they tend to just know local trends and know to discount certain things at certain times that are relevant to the area.
- Customer quotes from our personalization RPI survey
Retailers with better Personalization scores have better results on multiple critical outcomes
Source (in order of charts): 1) dh Personaliation survey, August 2023, n=10,641 US grocery shoppers. 2) Online, Similarweb. Brick and Mortar, dh Personalization survey. 3) Placer.AI. 4) dh Personalization survey.
Localized Assortment Leaders perform better across all outcomes: better traffic share, higher share of wallet, more monthly visits both online and in-store, and a stronger emotional bond with shoppers. Localized Assortment is the driver with the strongest correlation to share of wallet.
TOP 5 Retailers by Levers
H-E-B is the leader across all grocery retailers at offering shoppers the right variety of products to meet their needs as well as connecting with the local communities they serve. Big Y is best at local variety and products that come from local farmers and businesses. Together, these levers drive a Localized Assortment.
Baby care is where the Right Variety of Products matter most, followed by health care and fresh meat
Baby care – followed by health care, fresh meat, deli meat, personal care and fresh produce – is the category where a Localized Assortment (and the right variety of products) matters most.
Retailers included in the PRPI that are interested in receiving their individual banner profiles can place a request below.
SECTION 9
Key takeaways, concluding notes, and grocery retailers included
Noteworthy insights
We’ve shown there are categories where personalization matters more than others. That said, we cannot look at personalization in isolation and must remember to look at the whole Customer value proposition when thinking about what matters most to shoppers across categories.
The illustration lists categories in order of where Targeted Savings (the most important personalization driver) matters most.
It also shows the importance of other key levers of the value proposition like everyday low prices and promotions.
And so when we asked shoppers what matters most when shopping in each department, we found that in every department there is a triad that dominates in importance: base price, quality, and availability. This highlights the importance of getting the basics right: First, ensuring that the right products are on the shelves, and secondly, that the value core (price + quality) of each department is well-balanced and competitive. As we noted in base price perception’s impact on Targeted Savings, performing well in base price perception increases the likelihood of performing well in Targeted Savings.
When looking at the cost side of the equation for Customers, there are additional drivers and levers at the grocery retailer’s disposal -- EDLP, promotions and Targeted Savings -- that vary in importance by department:
- Targeted Savings play an important role in baby care and health care products. For fresh and household products, EDLP is more important than Targeted Savings. Targeted Savings can also be influential in deli meat and dairy.
- Promotions are particularly important for baby care, packaged food, and household products. And when compared to EDLP, promotions can be influential for personal care and non-alcoholic beverages.
Key Takeaways
- As we have noted throughout this RPI – the first of our RPIs to focus specifically on personalization – personalization matters more to Customers than it did years ago. It can help regional supermarkets and larger, national players alike.
- What we learned is that we do not define Personalization, Customers do. And for grocery retailers with millions of Customers, loving each Customer the way each one wants requires navigating the complexities of personalizing each journey. Those who succeed experience more visits per Customer, fuller shopping carts, and a stronger Customer belief that the grocery retailer is made "just for me".
- The triad of personalization drivers – Targeted Savings, a Frictionless Experience, and a Localized Assortment – is what Amazon, H-E-B, and Kroger do best. And although Targeted Savings (loyalty) is the most probable path to personalization, this represents half of what personalization means to Customers.
- Personalization leaders have clear and distinct approaches to how they drive personalization, but most leaders do well across the board. And so, as its name implies, personalization is not a one-size-fits-all approach, but rather a balancing act of carefully orchestrating all the right personalization levers for each Customer. Loving them the right way will lead you to a lifelong, fruitful marriage with your current shoppers.
- Personalization is a team and company effort. Winning at personalization requires organizations to be aligned for performance at scale. Personalization is worth it, but it is no easy feat. Only 45% of grocery retailers saying they focus strategically on personalization and 70% report experiencing scaling issues.
- Performing at scale includes (and this is not meant to be an exhaustive list): having customer data and data management platforms in place; defined Customer segments and outcomes; AI-driven decisions; real-time signaling; propensity models; access to large volumes of modular content; integrated marketing technology systems; aligned organization resources; rapid testing and learning approaches; and a talent development strategy.
- The arrival of genAI and hyper-personalization: With future generations of generative AI coming our way, there is simply no reason not to use and apply hyper-personalization. At dunnhumby, we have been using AI and ML to power our self-serve solutions and monitor Customers’ evolving tastes. However, evolving Customer needs are not the only reason to use AI. Yes, it can help automate tasks and scale marketing, but from a Customer standpoint, AI-led hyper-personalization has been shown to drive engagement, a frictionless experience, conversion rates, loyalty, Customer lifetime value, and ROI. It does require data collection, real-time analysis, scalability, security and privacy, testing and optimization, and AI/ML expertise – but it is well worth it.
- In fact, “87% of grocery retailer executives said that the marketing of groceries will become hyper-personalized, indicating a market shift from selling to the “average consumer” to a more individualized approach.”
- In the coming months, expect to see an additional piece of thought leadership as part of this personalization edition of dunnhumby quarterly from our very own Christiane Feresin, Customer Engagement and Media Manager for North America. She will be providing her perspective on hyper-personalization and the role it will play for grocery retailers and Customers alike.
But wait, there's more (soon)
Be sure to check back each week, as we'll be diving deeper into the topic below:
- Grocery subscriptions. Are Customers paying for a subscription and which?
- Recent ads. Where have Customers seen ads from grocery retailers?
- Decision channels. Which personalizable and mass aids do Customers use to make grocery shopping decisions?
- Shopping habits. How often do Customers engage in certain behaviors like identifying themselves to earn rewards?