KANSAS CITY, Kan. -- In a novel use of frequent shopper data, Ball's Food Stores, a 29-store chain here, is planning to employ a new customer relationship management system to reach out to shoppers in its market who have never set foot in one of its stores.
According to Charles Owen, director of database marketing for the chain, Ball's is installing MarketEXPERT XR 4.0, the latest version of a CRM solution from VRMS, Shelton, Conn., which is compatible with both the Oracle and the IBM DB2 Universal Database V8.1 relational platforms. Previously, Ball's used an earlier version of the VRMS system based on the vendor's proprietary database.
With the new, open platform, "we will have the ability to add demographic and psychographic data," Owen said. "We will look to find sets of consumers who have similar demographics to our current [loyalty card] customers, and reach out to them via targeted mailings." Previously, targeted promotions at Ball's were aimed at current shoppers based on past purchasing history collected through its loyalty card program, he said.
Ball's stores, which operate under the Price Chopper and Hen House markets banners, have been using the CRM solution from VRMS since launching its loyalty card program in 1998.
According to Carlene Thissen, president of Retail Systems Consulting, Naples, Fla., the type of consumer-level analysis now being pursued at Ball's is the future of CRM. "A lot of the analytic software today is product-based. It can only provide a list of who buys what product," she explained. Bringing in the demographic and psychographic components adds a new dimension, she said.
The new system at Ball's also includes analytic modules that allow analysis of product affinity and market baskets. In simple terms, the upgraded system will provide faster answers to more complex questions, Owen said. "We will be able to see what happens to the composition of the baskets when Tide is on sale," he explained. "We can ask, 'Do we really make up for the loss leaders?"'
The conversion process, which involves running old and new systems in parallel, takes about six to eight weeks, Owen said. He anticipates completing the process in early January.
Owen declined to comment on the financial details, but he does see the chain's CRM investment as a distinct competitive advantage.
While loyalty cards have been around in the food industry for several years, supermarket operators have been slow to actually make use of the data. However, Thissen sees this beginning to change.
"We have seen progress during the past year compared with previous years," she said.
Retailers have begun to take IT investments more seriously, she said. Also, with big players such as Winn-Dixie and Albertsons beginning to roll out aggressive frequent shopper programs, the rest of the industry is left with little choice but to be more pro-active, she added.