More Remarks on the Tesco Data Play

A little while ago, I posted some notes I’d made whilst reading “Scoring Points”, which looked at the way Tesco developed it’s ClubCard business and started using consumer data to improve a whole range of operational and marketing functions within the tesco operation (The Tesco Data Business (Notes on “Scoring Points”)). For anyone who’s interested, here are a few more things I managed to dig up Tesco’s data play, and their relationship with Dunnhumby, who operate the service.

[UPDATE – most of the images were removed from this post because I got a take down notice from Dunnhumby’s lawyers in the US…]

Firstly, here’s a couple of snippets from a presentation by Giles Pavey, Head of Analysis at dunnhumby, presented earlier this year. The first thing to grab me was this slide summarisign how to turn data into insight, and then $$$s (the desired result of changing customer behaviour from less, to more profitable!):

In the previous post, I mentioned how Tesco segment shoppers according to their “lifestyle profile”. This is generated by looking at the data generated by a shopper, in terms of what they buy, when they buy it, what stories you can tell about them as a result.

So how well does Tesco know you, for example?

(I assume Tesco knows Miss Jones drives to Tesco on a Saturday because she uses her Clubcard when topping up on fuel at the Tesco petrol station…).

Clustering shopped for items in an appropriate way lets Tesco identify the “Lifestyle DNA” of each shopper:

(If you self-categorise according to those meaningful sounding lifestyle categories, I wonder how well it would match the profile Tesco has allocated to you?!)

It’s quite interesting to see what other players in the area think is important, too. One way of doing this is to have a look around at who else is speaking at the trade events Giles Pavey turns up at. For example, earlier this year was a day of impressive looking talks at The Business Applications of Marketing Analytics.

Not sure what “Marketing Analytics” are? Maybe you need to become a Master of Marketing Analysis to find out?! Here’s what appears to be involved:

The course website also features an interview with three members of dunnhumby: Orlando Machado (Head of Insight Analysis), Martin Hayward (Director of Strategy) and Giles Pavey (head of Customer Insight) [view it here].

You can see/hear a couple more takes on dunnhumby here:
– Martin Hayward, Director of Consumer Strategy and Futures at dunnhumby on the growth of dunnhumby;
– Life as an “intern” at dunnhumby.

And here’s another event that dunnhumby presented at: The Future of Geodemographics – 21st Century datasets and dynamic segmentation: New methods of classifying areas and individuals. Although the dunnhumby presentation isn’t available for download, several others are. I may try to pull out some gems from them in a later post, but in the meantime, here are some titles to try to tease you into clicking through and maybe pulling out the nuggets, and adding them as comments to this post, yourself:
– Understanding People on the Move in London (I/m guessing this means “Oyster card tracking”?!);
– Geodemographics and Privacy (something we should all be taking an interest in?);
– Real Time Geodemographics – New Services and Business Opportunities from Analysing People in Time and Space: real-time? Maybe this ties in with things like behavioural analytics and localised mobile phone tracking in shopping centres?

So what are “geodemographics: (or “geodems”, as they’re known in the trade;-)? No idea – but I’m guessing it’s the demographics of a particular locales?

Here’s one of the reasons why Tesco are interested, anyway:

An finally (for now at least…) it seems that Tesco and dunnhumby may be looking for additional ways of using Clubcard data, in particular for targeted advertising:

Tesco is working with Dunnhumby, the marketing group behind Tesco Clubcard, to integrate highly targeted third-party advertising across Tesco.com when the company’s new-look site launches next year.
Jean-Pierre Van Lin, head of markets at Dunnhumby, explained to NMA that, once a Clubcard holder had logged in to the website, data from their previous spending could be used to select advertising of specific relevance to that user.
[Ref: Tesco.com to use Clubcard data to target third-party advertising (thanks, Ben:-)]

Now I’m guessing that this will represent a change in the way the data has been used to date – so I wonder, have Tesco ClubCard Terms and Conditions changed recently?

Looking at the global reach of dunnhumby, I wonder whether they’re building capacity for a global targeted ad service, via the back door?

Does it matter, anyway, if profiling data from our offline shopping habits are reconciled with our online presence?

In “Diving for Data”, (Supermarket News, 00395803, 9/26/2005, Vol. 53, Issue 39), Lucia Moses reports that the Tesco Clucbcard in the UK “boasts 10 million households and captures 85% of weekly store sales”, along with 30% of UK food sales. The story in the US could soon be similar, where dunnhumby works with Kroger to analyse “6.5 million top shopper households”, (identified as the “slice of the total 42 million households that visit Kroger stores that drive more than 50% of sales”). With “Kroger claim[ing] that 40% of U.S. households hold one of its cards”, does dunnhumby’s “goal … to understand the customer better than anyone” rival Google in its potential for evil?!