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Lowe's: Customers Personalize Their Experience with Cross-Channel Profiles

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The Challenge: Purchase history is crucial information, but many marketers miss significant opportunities by neglecting offline purchase behaviors.

Digital advertising makes it simpler than ever to use purchase history for targeting offers. As brands like Amazon have demonstrated, personalization based on purchase history drives outsize returns. But while sophisticated marketers take full advantage of online purchase history, they often neglect offline purchase history.

According to a recent study by Nielsen Catalina Solutions (NCS), consumer packaged goods (CPG) brands achieve Return on Ad Spend (ROAS) of three times or higher when they use offline "purchase-based information."

Marketers cannot leverage retail purchase information without collecting it. To do so while maintaining a positive customer experience, businesses need to create incentives for customers to link their online and retail purchase behaviors. Home-improvement retailer Lowe's has some innovative ideas.

Late last year, Lowe's Chief Information Officer Mike Brown led an effort to help customers manage home-related data, including receipts, appliance manuals and service warranties. According to a report in Bloomberg, "Customers will be able to scan a special card to monitor transactions, create room-by-room profiles of their homes and plan projects with store employees".

MyLowe's saves every member's in-store purchase history. This creates immediate value for customers: they can look up previously-used paint colors, track long-term renovation projects, and much besides. Most importantly, they can do this in-store or online.

The system also provides valuable data to Lowe's employees. At retail locations, sales associates can use MyLowe's profiles to provide superior customer service based on each customer's specific needs. And on Lowes.com, users who log into their MyLowe's accounts will immediately be reminded to take the next step on their home improvement projects.

With a simple set of tools linking online and offline purchase behavior and project planning, Lowe's has given customers a reason to maintain brand loyalty. Tom Lamb, Lowe's senior vice president of marketing and advertising, explained the value: "There's one part Home Depot loyalists, one part Lowe's loyalists. Everything in between -- and it's a big in-between -- is a jump ball... This is a tie-breaker."

TWO KEY TAKEAWAYS FOR MARKETERS:

» Link Online and Offline Purchase Data
Many businesses treat their online and retail businesses as separate silos. But without linking purchase data from both sources, marketers lose a significant opportunity. Build data stores that correlate shopping behavior across channels -- including retail.

» Incentivize Customers to Consolidate Purchase History
Lowe's employees don't ask customers to enter their phone number or address at every trip to the check-out line. MyLowe's gives customers reasons to login to their accounts as they stroll the aisles. It's a win-win: customers have access to valuable data, and Lowe's consolidates purchase history across channels.

» Personalize Your Customers' Online Experience with Offline Purchase Data
Once you've collected offline purchase data, use it to create a highly-personalized online experience. Among other features, MyLowes sends seasonal purchase reminders -- creating value for customers while driving revenue.

Ernan Roman is President of the marketing consultancy, Ernan Roman Direct Marketing.
Recognized as the industry pioneer who created three transformational methodologies: Integrated Direct Marketing, Opt-In Marketing, and Voice of Customer Relationship Research.

Ernan was recently inducted into the Marketing Hall of Fame.

Clients include Microsoft, NBC Universal, Disney, Hewlett-Packard and IBM.

2010-12-08-ernan.jpgErnan was named to "B to B's Who's Who" as one of the "100 most influential people" in Business Marketing by Crain's B to B Magazine.

His fourth and latest book on marketing best practices is titled: Voice of the Customer Marketing: A Proven 5-Step Process to Create Customers Who Care, Spend, and Stay.

Ernan is also the co-author of "Opt-In Marketing: Increase Sales Exponentially with Consensual Marketing" and author of "Integrated Direct Marketing: The Cutting Edge Strategy for Synchronizing Advertising, Direct Mail, Telemarketing and Field Sales."

www.erdm.com
ernan@erdm.com