06th Dec 2019

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What are you drinking? How Dan Murphy’s used personalisation to turn its marketing around

06th Dec 2019

At the Oracle Modern Cloud Day at Sydney’s Hilton Hotel this week, I was fascinated to listen to the experiences of Andy Sutton, Head of Data at Endeavour Drinks, the group that includes Dan Murphy’s BWS and Jimmy Brings.

In a presentation entitled ‘How do you accelerate from Audience Segmentation to Hyper Personalisation?’ Sutton told the story of the wake-up call that radically changed the group’s approach to how it communicated with its customers.

Sutton described how he received a terse email from the CEO of Endeavour, asking why he had just been sold a $90 bottle of wine for $10. He had received the same $10 wine promotion as everyone else, essentially downselling a high-end wine consumer by $80.

In response, Sutton outlined how the group overhauled how it uses customer data to personalise its marketing campaigns.

The challenge of complex data

Along with the other Woolworth’s brands, Dan Murphy’s and its liquor stablemates have been collecting data from the Woolworth’s Rewards scheme, but liquor has been a challenge because of the complexity of categories, seasonalities, local preferences, changing trends and reduced household spending.

After an initial struggle, however, tapping into the richness of the rewards data for personalisation began to yield results.

Over four years, Endeavour worked to leverage the data from its 3.8 million Dan Murphy’s rewards members to refine their audience segmentation, distinguishing between premium, mainstream and budget customers.

“Implementing things like a price plan so that you’re selling within a certain range and certain varietals rather than across the whole spectrum of prices you could offer (gives) a dramatic uplift, not just in the response we’re getting, but also in the customer experience,” Sutton said.

Timing is everything

The company also found the timing of the purchase made a huge difference.

“If you’re a customer and you buy a bottle of gin, then previously we would have promoted that to you every time a bottle of gin was on offer, which could be every week.

“So you get a bottle of gin every week – and if you’re doing that you’re doing fairly well.”

Now, Endeavour predicts the probability of when people buy certain drinks so that, if someone only buys one bottle of gin a year, they only receive promotions for gin once a year.

The ROI of personalisation

Today, each personalised email the group sends is worth about 20 cents of revenue, compared to just 6 cents for the blanket communications being sent previously.

Sutton said that around 80% of the 3.9 million rewards members have signed up to receive communications, meaning that Endeavour is able to generate over $600,000 from a single automated, personalised campaign.

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