20th Century Marketing With 21st Century Tools

By Edward Cone  |  Posted Thursday, November 10, 2011 17:11 PM

by Samuel Greengard

It's more than a bit ironic that grocery stores and retailers hand out loyalty cards and then do nothing to inspire loyalty.

I'm a vegetarian and I have never bought any meat at Safeway or Albertson's. They track every purchase I make. Yet, hardly a week goes by without receiving an e-mail ad for a meat sale or some other product I'd never buy in a million years. It seems as if they've simply ported over part of a print ad to an e-format. I've gotten to the point where I ignore the e-mails.

Apparently, these chains view a loyalty program as a way to understand mass buying habits and provide coupons and discounts mostly based on the aggregate. I'm sure they glean some valuable data--I do receive some store coupons at the register that are sometimes on target--but since I have loyalty cards for all the grocery stores at which I shop I'm not entirely sure how this alone engenders loyalty.

But, wait, it gets worse.

A few weeks ago I received an e-mail from Albertson's promising a $5 discount for every person I recommended who then signed up for its "E-mail Savings program." This approach indicates that it's all about amassing numbers rather than truly understanding customers and targeting them effectively. Why wouldn't a grocery chain analyze buying patterns--and the relationships between products--and perhaps supplement this with a quick online questionnaire (tied to a coupon reward) to make sense of segments and individuals?

I'm picking on grocery store chains here but these types of failures are pervasive throughout the retail industry...and beyond. Organizations have tons of data but, in most cases, it never gets used. Too often, these companies continue to use 20th century business models with 21st century technology.

How about offering coupons for products I haven't tried but might actually like? Or offering something, preferably at a discount, I might need based on recent purchases?

How about letting me load the coupons on my iPhone and scan them at the checkout stand via a barcode scanner or Bluetooth? And, while we're at it, how about actually rewarding loyalty with rebates or special coupon offers when I spend more?

Loyalty is ultimately a two-way street.