How Boots Used Customer Data to Modernise its Loyalty Business

In Data & Analytics, Featured on App, Loyalty & CRM by Vaughn Highfield

Boots Mosaic

Boots’ biggest loyalty turnaround

About three years ago Boots felt that they had the full picture of the customer. After all, it had the Advantage Card, web metrics, and the data it was allowed to capture from the pharmacy and opticians business. Boots was also expertly located to reach its target market as not only are 88 per cent of the UK within 10 minutes of a Boots store, but there are also 17.8 million Boots Advantage Card members out there too.

So far, so good for Boots. But then the smartphone revolution that had kicked off back in 2007 had reached a tipping point, customers were using mobile more and shunning anything that didn’t get shown on the tiny screens lodged in their palms. It’s during this period that Boots found themselves on the wrong side of this data divide. Now it needs to be in so many areas, it ditched its direct mailing approach and instead opted for a fuller picture method where people can get offers from wherever suits them best.

This shouldn’t be too tricky for a business that gets 60 million visitors to its stores a year, and holds 80 customer panels a year to hear about what their customers want most. And, seeing as 95 per cent of Advantage Card holders are women, 80 per cent of the Boots team are women, and women account for the majority of sales in all major categories, Boots is also in the business of knowing what women want.

To do this, it needs to look at what customers are doing, where they’re doing it, why they’re doing it and how they feel about what they’re doing too. This boils down to demographic, contact, transactional and responsive data – so marketers and community managers can find out what to talk about within certain sections.

However, they learnt the hard way that over-personalising things was actually a bad tactic to have. When a female customer comes in to regularly buy men’s deodorant, don’t send her a message with discounts for men’s deodorant that assumes she has a husband, when in reality it’s a single-mother buying Lynx for her son. Naturally the customer in this case complained, and now Boots’ tactic is to stay vague, but tailor offers to the products you know they buy regularly.

And it’s because of this that customers have embraced Boot’s multi-channel approach. Mind you, this did mean  re-sentimentalising its database, but as Boots’ head of loyalty & digital analytics, Martin Squires, said at Europe’s Customer Festival, “you can’t just build segments that focus on just online. Less people never shop online than those that do.”

So, since the move over to a digital approach, Boots now has the number one most-visited health and beauty website in the UK, it’s also got the most read health and beauty magazine in both digital and physical formats. They’ve published an app to the iOS and Google Play Store, and seen it hit the top 10 charts to boot.

Now, instead of paper-based statements and coupons they used to use, they do it all digitally from inside the app, allowing customers to see what’s going on in each store around the country in terms of regional and national offers. Customers will even have their Boots app tailored to the products and offers that suit them best – so they don’t have to go hunting for it. It isn’t even an overly complex process, with the app looking at your advantage card data to determine which products you buy frequently and then comparing those to over 400 possible offers stored on the Boots database – giving customers the most relevant offers.

While Boots may have moved very quickly from their previous space of paper coupons and somewhat targeted offers, now they’re trying to be where customers are before they even get their themselves. Only 20 per cent of traffic comes from mobile devices, but that’s going to change more and more as things shift. Ultimately it’s about being where the customers are, and Boots’ challenge still remains the same as it always was.

As Squires summed up rather perfectly, “organisations can’t control customer journey’s any more, customers do that themselves. Now the job is understanding those journeys and ensuring your company manages that experience better. You can no longer force the customers hand to fall where you want it to.”


[Image: Caroline & Phil Bunford – Flickr]