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54 Customer data is good for brands, good for retailers and good for customers. By placing customers first, rewarding loyalty and listening intently to their needs, both business stakeholders are able to improve their share of wallet. For example, a customer-centric retailer would never send a mailing to a loyal Pepsi drinker persuading them to buy Coca- Cola because it's not good for customers. Edwina believes that customer data is a powerful currency within business because of its honesty. " This is how you get an honest view of reality," she says. " It's the one figure that is factual and clear - you see the truth warts and all. Just follow exactly what the customers are doing." Many chief executives struggle to draw parallels between the different reporting structures and different metrics that department heads and product managers use to prove that they have the best department in the business, even if the share price and profits say otherwise. The neutrality of customer data is one reason it speaks so loudly to leaders. It directly links the shop floor to the boardroom. Look after the loyal One of dunnhumbyUSA's clients ' The Home Depot' came to realise that their business would grow if they paid more attention to their existing loyal shoppers, rather than become distracted by winning new ones. As recently reported in the press, analysis of The Home Depot's customer data revealed that even its best customers were only spending 40% share of their wallet. Indeed, 3% of the DIY retailer's best customers represented over 25% of their sales. Half of these were professionals - builders, plumbers and carpenters - and half were small business owners. The Home Depot was in danger of alienating its most valuable customers as it had shifted its focus onto ' softer' elements of DIY, like furnishings and decorations. The Home Depot had not appreciated how valuable its professional customers were and had not been rewarding them or targeting its marketing and services around their needs. The home retailer is now on a journey to ensure its pricing and product selection rewards its most loyal customers too. any colour you like as long as it's any colour you like Just follow what the customers are doing

55 win- win- win Helping retailers move fast Customer data empowers retailers to make decisions and change tactics fast. For example, a few years ago in Hungary, Tesco was concerned that it had lost 1% market share. The management speculated that it could be for a number of reasons: either because of the World Cup football tournament, the weather, or because they were losing upscale customers to a more premium supermarket called Interspar. The data revealed that the retailer was losing price- sensitive customers to the heavy discounters. This insight immediately shaped their tactics and Tesco focused on a series of ' bomb promotions', big price reductions, to win back and engage these customers again. Which they did. The customer data empowered Tesco to make an impactful, short- term decision. Richard Brasher, Commercial Director of Tesco has said that one highlight of the new Clubcard insight was being able to recognise value, knowing exactly how much a customer had spent with Tesco in the previous year. For Richard, this represented a paradigm shift in the organisation: customer data was empowering Tesco's management with the knowledge and tools to look after and reward their best customers. No longer was every customer an average customer. Customer insight enables any business problem to be described in terms of customers as well as in terms of revenues. Sales talk Results for dunnhumby's clients speak for themselves. Today, Tesco has earned a leading share of the UK grocery market, and the supermarket has experienced sales growth without fail every year since the launch of Clubcard in 1993. Kroger too is benefiting from its focus on customers with consistent sales growth since 2003. Casino's 2008 profits were up 7.3% on 2007. This success has not gone unnoticed by the investment community. In 2005, investment bank J. P. Morgan Cazenove wrote that the Clubcard is " Tesco's most potent weapon in the ongoing battle for market share." The report went on to highlight 10 areas where Clubcard gave Tesco competitive advantage: identifying customer trends, targeting communications, better promotions, basket building, defence against competitors, ranging, negotiating power, cross- selling, site selection, driving footfall to the store. We have shown how customer data can drive benefits for customer and business alike