Tag Archives: Retail

Customer Engagement Analytics That Fuel Loyalty – A Client Success Story

Grocery loyalty image
Aug292016

We’ve been blogging about a Canadian grocer that is changing the game with its analytics-driven loyalty program. For its +9 million loyalty members, personalized offers are so relevant, it’s almost like having an old-fashioned relationship with the corner grocer. In this new-fashioned relationship, however, members can redeem their offers at more than a thousand stores of various types, in many locations across Canada. What’s this grocer’s secret to success? Here’s a peek inside the analytics. Understanding customers as more than strings of transactions Delivering a personally unique set of relevant offers every week on such massive scale is a computationally demanding, mathematically intense undertaking. The heavy lifting is performed by over 4,000 time-to-event (TTE) predictive models, generated and updated every four months by a FICO-built analytic “factory.” Each TTE model predicts the propensity of a customer to purchase a particular product — say, a specific brand of laundry detergent —... [Read More]

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Customer Engagement Case Study Spotlight: Thinking Differently About Loyalty

Grocery loyalty image
Aug252016

Retail loyalty programs are ubiquitous and predictable — except in the Canadian grocery space. Here, a large retailer is changing the game, transforming what customers expect from loyalty programs and what retailers can accomplish with them. In 2013, when a major Canadian grocer was preparing to launch its first loyalty program, millions of Canadians already had loyalty cards from other grocers — yet grocery sales dropped 0.4% industry-wide. Clearly, there had to be a better way than the largely indistinguishable approach taken by competitors. The grocer decided to take a different path, turning to FICO for advanced analytics to fuel its loyalty program. Predictive and prescriptive analytics determine how to make the best use of available marketing funds. Instead of indiscriminately dispensing points for every dollar spent, the program gives offers and rewards to customers based on a multidimensional understanding of individual shopping behavior. Instead of cross-selling aimed at loading... [Read More]

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Customer Engagement When Loyalty Is Rocket Science

Nov242015

How do you launch a new loyalty program in a saturated market during one of the worst years for grocery sales in decades…and rocket to success? By making relevance to individual customers the core fuel of everything you do. Case in point: a Canadian grocer’s loyalty program is using sophisticated analytics to identify — from more than 380 billion possible offer combinations — the handful of offers that will be most relevant and appreciated by each customer for the upcoming week. The program is a game changer not only for its ability to anticipate customer needs, point sensitivities and even product sentiments, but also because it’s purely digital. Customers receive offers, along with recipes and other information, via the website, email or mobile app. The loyalty program, which rocketed to near the top of the nation’s grocery programs in just one year, is also changing the economics of cultivating loyalty.... [Read More]

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Customer Engagement How to Ensure Relevance and ROI with Discount Offers

Feb252015

In the world of customer centric targeted marketing, the biggest challenge that marketers face is that of balancing relevance with return on the investment (ROI). Relevance implies that the targeted message speaks to the targeted customer, both in terms of content as well as timing. For example, if a bank reaches out to a customer with a message about taking out a mortgage at an attractive interest rate, it would be relevant only if the customer needs the mortgage in the near future. An irrelevant message can turn off potential customers and can do more harm than good. Predicting the Right Timing This problem is a predictive problem where one not only needs to predict the likelihood that the customer would require a mortgage, but also get the timing right. Target the customer too early with a mortgage offer when she is not yet ready for the offer, and it’s... [Read More]

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Customer Engagement 5 Trends Triggering the Decline of Black Friday

Nov262014

Starting in 2004, Black Friday (the Friday after Thanksgiving) became the busiest shopping day of the year in the US. This year, 95.5 million US consumers are expected to spend more than $40 billion on Black Friday. This is nearly 7 percent of the total that the National Retail Federation forecasts for the 2014 holiday season. This holiday season promises to be lucrative for retailers, with sales rising 4.1 percent to $616.9 billion, higher than 2013’s actual 3.1 percent rise. However, 7 percent marks a six-year low (as a percentage of overall retail sales for the season) for Black Friday, more in line with the recession years. Deloitte concurs. According to its 29th annual holiday survey, nearly half of consumers no longer rely on Black Friday for shopping and deals the way they once did. And 43 percent of respondents plan to do most of their holiday shopping in December... [Read More]

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Customer Engagement Join Us For FICO World 2014

May212014

Attracting, serving and protecting customers is getting tougher, so how are companies using predictive analytics to out-maneuver competitors and win customer loyalty? Join us at FICO World 2014 to discover answers from experts and network with your peers. Registration is now open for the conference, which will be held November 11-14 in San Diego, California.

FICO World has become the leading global conference on analytics-powered customer engagement strategies. This year’s theme, “The New Customer Imperative,” stems from the convergence of social, mobile and cloud, which is evolving customer behaviors and expectations, revolutionizing business and society, disrupting old business models, and creating new leaders. We’ll explore this theme through a number of sessions, speakers and events, including:

100+ presentations on analytic innovation, credit scoring, customer growth and retention, customer originations, debt management, fraud and security, mortgage lending, regulatory compliance, and small business lending.

Keynote presenters Theresa Payton,...

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Fraud & Security Cyber Security: The Streaming Analytic Battlefield

Apr012014

For several years, I have been actively “fighting the good fight” in the area of cyber security. Beyond my anti-fraud work here at FICO, I also participate in various industry efforts focused on preventing cyber crime, most recently joining the board of directors for the Cyber Center for Excellence. Cyber security touches our lives daily, whether it's protecting our national infrastructure, securing payment systems, or installing virus protection for personal computers and devices. The recent data breach at Target caused many to rally around the adoption of EMV payment cards. But while it’s a step in the right direction, it would not have prevented the loss of data estimated to affect more than 70 million customers. The Target breach, however, does point to the need to monitor the computer networks for malware designed to steal PII (personally identifiable information). These are costly problems for both consumers, who need to stay vigilant of any PII misuse, and to financial institutions, where an estimated $200 million will be spent just to replace...

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Fraud & Security Is It Fraud? Or New Behavior?

Jul302013

A customer makes a card transaction that looks odd compared to her historical behavior patterns. Is this change the first sign her account has been compromised by a fraudster? Or just new behavior by the legitimate customer? Making the right call in a fraction of a second is absolutely critical today as banks compete neck-and-neck to deliver superior customer experiences. Reducing false positives—legitimate transactions declined as potentially fraudulent—has a direct and immediate impact on cardholder perceptions of service quality. Keep in mind that few cardholders differentiate which part of the bank—fraud management, mobile banking, a service center—they’re interacting with. It’s all part of the same experience. Every touch shapes their perception of how well the bank knows them and how well they’re being treated. Because fraud management is one of the key real-time interactions they may experience, it can play a central role in strengthening those customer relationships. Recently, I’ve been blogging about two new analytic technologies that...

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Customer Engagement Join Us For FICO World 2013

Jan082013

How are companies using Big Data analytics to understand and collaborate with today’s connected consumer? Join us at FICO World 2013 to discover answers from experts and network with your banking peers. Registration is now open for the conference, which will be held April 30-May 3 in Miami. FICO World has become the leading international conference on analytic strategies. This year, we have a packed agenda with more than 80 presentations from 70 banks and retailers on fraud management, analytic innovation, risk management, collections and improving the customer experience (view a list of sessions). Attendees will also hear from keynote presenter Kenneth Cukier, data editor for The Economist and co-author of a new book on Big Data. Learn more or register for FICO World 2013.

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Fraud & Security Watch Out, It’s Cyber Monday

Nov262012

Today is "Cyber Monday" in the US — the Monday following Thanksgiving, which has become one of the bumper sales days across electronic commerce sites. Every year the absolute volumes of online sales increases, as does the proportion of electronic commerce spend compared to traditional spend at physical retailers. This shift in consumer behavior has also attracted those from the criminal fraternity, who are seeking to capitalise on consumer’s lack of knowledge about safe online shopping. The continued strength of "card not present" fraud losses shows that people continue to be duped into providing their credit or debit card credentials in an insecure manner or to unauthorised sources, particularly when online. Customer education and awareness is imperative. Shopping at secure sites, limiting the disclosure of payment credentials, registering for and using "3 Domain" security protocols like Verified by Visa and MasterCard Secure Code, and being "offer savvy" (if it looks too good to be true, beware!) are all...

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