Coborn's, an employee-owned, independent grocery retailer operating 77 stores across several states, faced a challenge when they noticed reduced spending by their most valuable customers across seven crucial departments. To tackle this issue, they implemented an automated solution targeting these customers with personalized department offers. With the help of an analytics partner, Coborn's categorizes its customers based on household shopping frequency, items purchased, and overall spending patterns.
The "Primary" category represents their most valuable customers, and Coborn's further assesses each customer's shopping and spending habits within specific departments (Dairy, Grocery, Bakery, Frozen, Deli, Produce, and Meat). The campaign's objective was to re-engage those customers who had previously spent at a Primary level within these departments but had reduced their spending in subsequent quarters, ultimately aiming to return them to a Primary spending status.
Strategy and Campaign
Coborn's developed an email marketing campaign to get these valuable customers back in the store and shopping in specific departments on a weekly basis. The campaign consisted of one email per week for three weeks, each containing the same offers to encourage more frequent store visits and department shopping.
Each message contained a personalized $1 off digital coupon for each of the departments where spending had decreased for that individual. An email could have up to seven digital coupons or as few as one. Coborn's used A/B testing to determine the best messaging approach to encourage engagement, including subject line, personalization, and optimized send times.
Coborn's used marketing automation tools to dynamically insert applicable offers into each individual's message. A single mailing template was scripted to evaluate all available offers in the offer table and populate content blocks, each block containing a $1 coupon for a specific department. The same template was used week-to-week and quarter-to-quarter as the campaign repeated.
Coborn's personalized marketing campaign is a shining example of how businesses can use data, technology, and creativity to achieve their marketing goals. By understanding their customers' needs and using personalized offers, they were able to drive incremental sales, increase customer engagement, and achieve their business objectives.
Results
Up to seven personalized offers were sent to 16,000 customers over a period of three weeks. Each message contained between one and seven unique digital coupons, tailored towards the departments where individual spending had shown a decrease. This strategic personalization proved highly effective, bringing in nearly $200,000 in incremental sales.
The campaign was particularly impactful in driving customer progression towards Primary status. Overall, 27% of the households that redeemed their coupons moved up to this status in Q1 2023. Notably, the Frozen department observed the highest progression rate, with 30% of redeeming households achieving Primary status.
In terms of incremental lift, the campaign generated $198K across the store, with Grocery ($61.8K), Meat/Seafood ($32.2K), and Dairy ($30.2K) departments registering the highest incremental dollars within respective categories.
Conclusion
The success of Coborn's personalized marketing campaign underscores the power of personalization and the effectiveness of the company's approach in enhancing customer engagement and driving sales growth. This campaign would not have been possible without Coborn's ability to provide personalized offers at a customer level, facilitated by the dynamic insertion of applicable offers via its marketing automation tools.
Key learnings from this use case that can be applied to any customer centric campaign include:
Personalization is key to driving customer engagement and sales growth.
Marketing automation tools can be used to scale personalized marketing campaigns efficiently and effectively.
Data-driven insights are essential for identifying the right customers to target and the right offers to make.