CFO World

How activity data is helping Chemmart secure customer loyalty

Pharmacy retailer strives to reposition its customer loyalty program away from transactional purchases to everyday behaviour to drive health and wellbeing of consumers

The marketing team at Australian pharmacy group, Chemmart, was facing what many consider the ultimate brand challenge of the digital age: Find a voice and differentiating in a sea of sameness.

“We looked at a lot of research over the last couple of years to see how we could differentiate ourselves in market,” Chemmart national marketing manager, Darren Gunton, told CMO. “One key factor was having an ownership position on health.”

At the same time, the group prides itself on personalised service to customers around their wellbeing in its stores nationally, such as cholesterol and DNA checks.

“We have fantastic execution in-store doing health services, we provide a lot of engagement around health, and our pharmacists are trained to get out from behind the counter and talk to customers,” Gunton continued. “We have great NPS with the highest engagement levels among businesses benchmarked on engaging customers.

“We’ve been looking at ways to strengthen the health relationship with our customers, just like the pharmacist in-store does. Eventually, we want to be pharmacist in their pocket, giving them health information they can’t get anywhere else.”

The missing gap was in the customer loyalty program. “We still ran it like a retail program,” Gunton said. “In putting health and wellness at the centre of everything, it’s important to try and position our loyalty program as something that helps with that as well.”

Chemmart’s loyalty club has been around for eight years and boasts of 1.5 million members. Over the last 12 months, Gunton said the emphasis has been on creating a best-in-class program that centres on the health of Australians.

To help, the company invested in Oracle’s Responsys cross-channel campaign management and email marketing platform six months ago, gaining the ability to create more personalised journeys for its customers. It’s also increasingly gathering customer data, as well as sourcing external intelligence sources, such as weather information, to be more relevant around an individual’s everyday health.

“If there’s a high pollen count, and you have a propensity for allergies or asthma, we can tell you that today is a high pollen count day so it’s probably better not to be outdoors in Melbourne, plus here’s some products that might help you out,” Gunton said. “The objective is putting out EDMs and communications personalised to your health needs, and starting to understand the individual in a way that helps that individual.”

In turn, this has seen Chemmart’s marketing team become more content driven in order to generate both more and different types of content, such as blog posts and video assets. Over the past 18 months, the team has moved away from content being produced mostly by its agency, to doing most of the creative work in-house.

“That means we’ve had to transform the team to be more agile, giving them the tools and resources to produce quickly, efficiently and produce a lot of different content,” he said. “Personalised conversation means you need to have lots of different content available.”

Seeking activity in customer loyalty

The latest component of Chemmart’s loyalty strategy has been partnering with Australian startup, ZIVA, on a trial of its new marketing platform-as-a-service offering, allowing brands to engage with consumers through connected devices. ZIVA synchronises with an end consumer’s chosen connected device or mobile app, then collects as well as normalises activity data, sending it back to the brand client for analysis and action.

ZIVA’s heritage is in the healthcare sector, and Gunton said Chemmart was attracted to the idea of a platform that could help to deliver engagement around activity.

“So much of your health comes from being active, and having the knowledge to make better health decisions,” he said. “Activity was a cornerstone we hadn’t had a lot of focus on or link to.”

Launched on 13 October, Chemmart’s ‘Walk to Win’ campaign encourages members to walk 10,000 steps per day to be in the running to win a $7500 Flight Centre travel voucher. The aim is to encourage and reward members for healthier lifestyle choices, rather than just transactional purchases. Users opt-in via a digital portal, nominating their chosen device or app, and the platform does the rest.

So far, 10,000 people have signed up, higher than expected, Gunton said, taking a combined 150 million steps. Another unexpected benefit is that members have shared the campaign, encouraging non-Chemmart customers to engage. Importantly, Chemmart also gets access to aggregated activity data to use for other customer segmentation work and insights.

Gunton said the activity is being supported by a big integrated omni-channel campaign encompassing social, TV, digital and in-store channels and runs until end of November.

“The most surprising thing for me is how engaged these people are,” he said. “Open rates, for example, on emails are normally about 20 per cent, and with this we’re getting close to 60 per cent. It’s fantastic to see the level of engagement and interest this has sparked in our customer base.

“For something we saw as a trial and to see what happens, it’s been very successful.”

Up next: How Chemmart plans to take its pilot connected device trial to new heights

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The next steps

Chemmart is looking to do follow-up activities, and one of the ways Gunton hoped to evolve the program is by identifying members that need to up their step count and incentivise them in different ways.

“For example, if you walk 10,000 steps today, we could give you a discount,” he said. “There are lots of ways to harness this to help them be healthier and do something for them.”

Thanks to Responsys, Chemmart has powerful analytics tools for predictive modelling, and can see campaigns results and usage within the platform. “By importing the ZIVA data, which is live, we can then look at relationships between what they are buying, such as if they’re buying weight loss products and the amount of steps they’re doing,” Gunton said. “Or we could see healthy activity versus other things they’re doing, and suggest products or information to help them on their way.

“It’s early days in getting the data here and seeing the relationships and correlation, but as an agile team, we can respond to this and build a journey based on these insights, as we’re flexible enough to do that.”

Chemmart already had some level of customer segmentation analysis in place, using recency, frequency and monetary value, but it’s looking through data to find other segments and propensities that exist that the brand didn’t realise existed, such as cross-product relationship.

“It has meant we have been more fluid and a lot more work has been doing in analysis driven and creating new segments to be able to talk to,” Gunton said.

“Our next step with ZIVA is to look at campaign gains, ask our customers for their response to see where we can improve for another trial, and make it a more instant reward, rather than just winning a trip. There are ways of integrating so we can do rewards based on products they want to purchase or points as an ongoing integration. Then we’ll look at other ways we can reward their health and incentivise for health benefits.”

The big goal is to increase active membership. “If we can have those members being more active and using us, then everything else will flow – customers will come in, we’ll get more yield and frequency of visit,” Gunton said.

“The one thing that’s hard to measure but which we’d love to is the improved health of Australians.”

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