The key motivation for running a consumer promotion is always business growth. This might be stimulation of short-term sales but also an increase of brand equity leading to longer-term sales too.
However, one of the additional benefits of running activations is the opportunity to capture incredibly valuable information about your shoppers and build your database of customers.
Data is the heartbeat of every business and all need to know more about their customer. Even if you think you know them now you want to stay in touch with them to help define your future plans and that customer contact will always need to evolve and grow. The reliance on third party data providers is expensive and facing more challenges especially online with the deprecation of cookies (even if that has been delayed).
There are brands that do not naturally lend themselves to engagement online where almost all customer data capture now happens. For low interest categories, more functional products and impulse purchases the traffic volume to a brand website might be incredibly low as a proportion of shoppers. Some brands really do need an incentive or value exchange to get the traction.
Consumer promotions present an opportunity to drive visits to a brand environment and acquire fresh customer data. It is important to point out that the relevant data privacy rules must be respected and opt-in / opt-out checks in place. However, the potential for customer connection and data generation through promotions is often overlooked and undervalued.
5 reasons to collect customer data
Better understand your customer
Learn more about your customers with the potential to even segment your target audiences for future growth. Even a few simple questions (on an entry form for a promotion for example) can help drive future product development, influence communications or determine the next promotional plan.
Build and evolve your CRM
Gain permission to re-contact customers and achieve greater understanding of them. Upsell, cross-sell or get early feedback for NPD and offers.
Open up to customer feedback
Make connections, build trust and enable customers to share their challenges and contribute to future success.
Word-of-mouth and peer recommendations are incredibly powerful and enabling a friend-get-friend approach (respecting data privacy) to sharing news and offers including promotions (such as Mars’ Win2Gether) increases the opportunity to learn even more about even more of your customers.
With customer data you have the ability to track, measure and evaluate marketing activity as well as brand equity. A more robust customer database can help with control & test experiments too and benchmark performance over time.
Chris Arnold is Business Development Director at VCG PromoRisk.