RON & LLOYD'S HONES TARGETED MARKETING

DENISE ZIMMERMAN

NEW LONDON, Wis. -- Ron & Lloyd's here will pump up the targeted marketing muscle of its electronic frequent-shopper program this week with the installation of multimedia kiosks.

The touch-screen, shopper-interactive kiosks, which were to go on line at the Neenah store this week, are linked to a card-based electronic frequent-shopper program, said Mark Dodge, director of information systems at the five-store independent operator.

Shoppers enrolled in the Savers Club program scan their card at kiosks to activate a full-motion video clip welcoming them to the store, he said. In five seconds the kiosks print a list of targeted promotions based on point-of-sale scan data gathered during that shopper's previous store visits.

Primary objectives of the program are to build shopper loyalty and average transaction size and to better evaluate promotions.

Dodge said scan data gathered on its IBM 4680 POS system is processed according to shopper groups and universal product codes, allowing the chain to identify different segments of shoppers in a highly detailed manner.

"I can tell you who walked in our store and bought Diet Pepsi 12-packs and who didn't buy Pepsi 12-packs," he said. Such information is collected and analyzed weekly, but it could be done more frequently if needed.

"In one of our stores, we're collecting about 12 meg[abytes] of information a week, and that's a lot of information to try and do something with real fast," he added.

Point-of-sale transaction data is extracted and processed through the POS-TM software program from POS-Tech, Lincolnshire,

Ill. Kiosks were co-developed by Ron & Lloyd's and Easy Access, which is based here.

The weekly reports have documented incremental increases in customer counts and transaction size, Dodge said. In addition, the data is used to evaluate manufacturer promotions tied to the frequent-shopper program.

"We're working with about 20 major manufacturers, just testing it to see what kind of redemption rates we're going to get with these promotions," he said. Redemption rates have ranged from 12% to 87%, with the latter being giveaways and deep discounts.

"A lot of it is that we're trying to get a product into the hands of customers who haven't tried it before," Dodge added. "Our primary goal is to let our customers know we appreciate them shopping at our store. The customer is benefiting, our vendors are benefiting because they're getting product into the hands of people who haven't tried it before, and we're benefiting by making our customers a little more loyal."

Dodge told SN that Ron & Lloyd's began to offer electronic discounts to Savers Club members four years ago, but only recently started to use the data gathered for targeted marketing purposes. Going forward, he said the company will consider installing a wide area network of communications so the data can be shared between stores to market effectively to the cross-shopper.

"If I've got somebody who's a primary shopper in our Neenah location and a secondary shopper in our Waupaca store, I can market to that person differently," Dodge said. "If we've got somebody who's using one of our stores as a 'pickup' store, we're going to target to them differently than when they're shopping in their primary location.

"There are some people who don't believe in that [promotional strategy] but my idea of target marketing is 'micromarketing' -- and not just hitting somebody [with a discount] because they're a customer."

The company will use point-of-sale data not only to fuel marketing through the kiosks but also for targeted mailings designed to recover lost shoppers, he said. Results from a December mailing -- the company's first -- should be compiled next week.