SYSTEMS AND METHODS FOR MANAGING RETAIL OPERATIONS USING BEHAVIORAL ANALYSIS OF NET PROMOTER CATEGORIES
20190034951 ยท 2019-01-31
Assignee
Inventors
Cpc classification
G06Q30/0202
PHYSICS
G06Q10/06393
PHYSICS
International classification
Abstract
Systems and methods for optimizing retail store management by identifying customers whose behaviors more likely make them to be net promoters (regardless of the buying habits), by using enhanced customer segmentation and responsive detailed customer behavioral modeling systems to create behavioral promoter scores capable of sensitivity segmentation, and to detect key drivers (price, promotion, choice, quality) that have potential opportunity for improvement. In addition, the system is capable of determining the reason why the area is performing in a given manner and how the retailer may improve the performance of the area.
Claims
1. A method for managing a retail operation having multiple locations, comprising: a) identifying heartland customers, who are net promoters of the retail operation; b) identifying battleground customers, who shop with the retail operation and also with competitors; c) for both heartland and battlefield customers, and for specific product categories, and for specific retail locations, analyzing transactions to thereby derive customer behavior sensitivities to different specific elements of the store's proposition, including at least promotion, price, and quality; and segmenting customers into subgroups, according to their sensitivity to different specific elements of the store's proposition; and d) modifying the investment in different ones of the product segments, in dependence on step (c), in a direction that drives toward improved profitability.
2. The method of claim 1, wherein step (c) uses as inputs, for different respective customers, the frequency of that customer's visits to a specific location; the categories that customer buys at that retailer's store location, and that customer's total spend at the retail operation.
3. The method of claim 1, wherein step c uses as inputs, for different respective product segments, identification of purchased items as one or more of at least: basic goods; promotional goods; choice goods; low price goods; and quality goods.
4. The method of claim 1, wherein step d uses the sensitivities of heartland customers to drive strategy changes for battleground customers.
5. A method for managing a retail operation, comprising: a) identifying heartland customers, who are net promoters of the retail operation; b) identifying battleground customers, who shop with the retail operation and also with competitors; c) for both heartland and battlefield customers, and for specific product categories, and analyzing transactions to thereby derive customer behavior sensitivities to different specific elements of the store's proposition, including at least promotion, price, and quality; and d) modifying the investment in different ones of the product segments, in dependence on the sensitivities derived in step (c), in a direction that drives toward improved profitability.
6. The method of claim 5, wherein step (c) uses as inputs, for different respective customers: the frequency of that customer's visits to the retail operation's location; the categories that customer buys at the retailer's store location: and that customer's total spend.
7. The method of claim 5, wherein step (c) uses as inputs, for different respective product segments, identification of purchased items as one or more of at least: basic goods; promotional goods; choice goods; low price goods; and quality goods.
8. The method of claim 5, wherein step (d) uses the sensitivities of heartland customers to drive strategy changes for battleground customers.
9. A method for managing a retail operation selling multiple product categories in multiple retail locations, comprising: a) identifying heartland customers, who are net promoters of the retail operation; b) identifying battleground customers, who shop with the retail operation and also with competitors; c) for both heartland and battlefield customers, and for specific ones of the product categories, and for specific ones of the retail locations, analyzing transactions to thereby derive customer behavior sensitivities to different specific elements of the store's proposition, including at least promotion, price, and quality; [and segmenting customers according to their sensitivity to different specific elements of the store's proposition;] and d) modifying the investment in different ones of the product segments, in dependence on step (c), in a direction that drives toward improved profitability.
10. The method of claim 9, wherein step (c) uses as inputs, for different respective customers, the frequency of that customer's visits to the retail operation's location; the categories that customer buys at the retailer's store location, and that customer's total spend at the retail operation.
11. The method of claim 9, wherein step (c) uses as inputs, for different respective product segments, identification of purchased items as one or more of at least: basic goods; promotional goods; choice goods; low price goods; and quality goods.
12. The method of claim 9, wherein step (d) uses the sensitivities of heartland customers to drive strategy changes for battleground customers.
13-19. (canceled)
Description
BRIEF DESCRIPTION OF THE DRAWINGS
[0012] The disclosed inventions will be described with reference to the accompanying drawings, which show important sample embodiments and which are incorporated in the specification hereof by reference, wherein:
[0013]
[0014]
[0015]
[0016]
[0017]
[0018]
[0019]
[0020]
[0021]
[0022]
[0023]
[0024]
[0025]
[0026]
[0027]
[0028]
DETAILED DESCRIPTION OF SAMPLE EMBODIMENTS
[0029] The numerous innovative teachings of the present application will be described with particular reference to presently preferred embodiments (by way of example, and not of limitation). The present application describes several inventions, and none of the statements below should be taken as limiting the claims generally.
[0030] The present application teaches that customers whose behavior matches certain profiles are more likely to be net promoters, regardless of their buying habits. The group of customers, which have high net promoter scores and consistently heavy buying habits, are an important component of growth for a retail operation.
[0031] In addition this application demonstrates that those customers who are detractors offer a significant opportunity for a retailer. These customers are more influenced by relative-competitive propositions, and will respond rapidly to influences in the marketplace.
[0032] The present application teaches that customers will have different sensitivities, which can be identified and tracked by customer and by product segment, to provide useful information in optimizing retail store management.
[0033] For example, some important categories of customer sensitivities are price, promotion, quality, and variety. By tracking the behavior of customers who are net promoters or detractors, and comparing their behavior with those customers who are not yet net promoters, and important information can be derived for use in optimizing the retail operation.
[0034] The distinction between heartland/promoter customers and battleground/detractor customers is important. One major difference between a heartland customer and a battleground customer is their usage of the retailer as a primary source of basic goods. A heartland customer will consistently purchase basic goods such as milk, butter, bread, and eggs whereas a battleground customer will only purchase basic goods from the retailer intermittently. The same metrics, which are used to identify high-volume net promoter customers, can also identify customers whose buying patterns are inconsistent over time in the areas where consistency would be expected. For example, in a grocery operation, a customer who buys three gallons of milk per week for weeks or months, and then stops buying milk from this operation, has probably gone to another vendor to buy milk.
[0035] The present application discloses computer systems and methods which improve the identification and management of net promoter customers, as well as customers who are less committed or not committed to a particular retail environment, as well as business methods which make use of such computer systems and methods.
[0036]
[0037]
[0038]
[0039]
[0040] After categorizing the customer's shopping behaviors the FACTS system 301 checks that the customer's spending information is consistent (311, 313), unless the step is by-passed due to the customer category (307). If the customer category is 305 and the customer's spend information is consistent (311), then the customer always uses retailer as a primary sources for goods 315, including basic goods, making that customer a heartland customer (323). If the customer category is 305 and the customer's spend information is not consistent (311), then the customer sometimes uses competitors for major goods (317), sometimes including basic goods, making that customer a battleground customer (325). If the customer category is 307, the customer is a battleground customer 325. If the customer category is 309 and the customer's spend information is consistent (313), then the customer sometimes uses retailer for the major source of goods (319) making that customer a battleground customer 325. If the customer category is 309 and the customer's spend information is not consistent 313, then the customer never uses retailer as a major source of goods (321) making that customer a wilderness customer (327).
[0041]
[0042]
[0043]
[0044]
[0045] For the key drivers that are ranked according to a given set of criteria (507, 525) the next step is assignment of a score to the transaction (407, 425). The score is generally determined by the number of articles in the transaction that fall under the key driver that is being indicated or it can be defined by the user. In cases after assigning a score to the transaction the customer behavioral model 501 checks to see if the transaction threshold score has been reached 409, 427, the threshold score can be determined by the individual retail user or provided by market research. If the threshold score is reached, the transaction is given the appropriate label (513, 533). If the threshold score is not reached, the transaction receives another transaction label (513, 531).
[0046] After the customer transactions have been labeled (513, 515, 531, 533, 549, 551), the customer behavioral model 501 checks the historical customer transactions and analyzes the data (517, 535, 553). Some data from the previous aggregation of transactions, some from the detail of individual item purchase. The customer behavioral model 501 checks to see whether the customer's behavior meets a certain threshold (519, 537, 555), which is determined by the application of models to match these behaviors to market research data. Depending on what thresholds are met, the customer is assigned certain focuses (521, 523, 539, 541, 543, 557, 559). It should be appreciated that a customer can be assigned more than one focus, and the customer's focuses will be used to determine the customer's sensitivities.
[0047]
[0048]
[0049]
[0050]
[0051]
[0052]
[0053]
[0054]
[0055]
[0056]
Advantages
[0057] The disclosed innovations, in various embodiments, provide one or more of at least the following advantages. However, not all of these advantages result from every one of the innovations disclosed, and this list of advantages does not limit the various claimed inventions. [0058] Improved Profitability of retail operations; [0059] Optimized targeting of promotions; [0060] Improved competitive advantage in battleground markets.
[0061] According to some but not necessarily all disclosed embodiments, there is provided: a method for managing a retail operation having multiple locations, comprising: a) identifying heartland customers, who are net promoters of the retail operation; b) identifying battleground customers, who shop with the retail operation and also with competitors; c) for both heartland and battlefield customers, and for specific product categories, and for specific retail locations, analyzing transactions to thereby derive customer behavior sensitivities to different specific elements of the store's proposition, including at least promotion, price, and quality; and segmenting customers into subgroups, according to their sensitivity to different specific elements of the store's proposition; and d) modifying the investment in different ones of the product segments, in dependence on step (c), in a direction that drives toward improved profitability.
[0062] According to some but not necessarily all disclosed embodiments, there is provided: a method for managing a retail operation, comprising: a) identifying heartland customers, who are net promoters of the retail operation; b) identifying battleground customers, who shop with the retail operation and also with competitors; c) for both heartland and battlefield customers, and for specific product categories, and analyzing transactions to thereby derive customer behavior sensitivities to different specific elements of the store's proposition, including at least promotion, price, and quality; and d) modifying the investment in different ones of the product segments, in dependence on the sensitivities derived in step (c), in a direction that drives toward improved profitability.
[0063] According to some but not necessarily all disclosed embodiments, there is provided: a method for managing a retail operation selling multiple product categories in multiple retail locations, comprising: a) identifying heartland customers, who are net promoters of the retail operation; b) identifying battleground customers, who shop with the retail operation and also with competitors; c) for both heartland and battlefield customers, and for specific ones of the product categories, and for specific ones of the retail locations, analyzing transactions to thereby derive customer behavior sensitivities to different specific elements of the store's proposition, including at least promotion, price, and quality; [and segmenting customers according to their sensitivity to different specific elements of the store's proposition;] and d) modifying the investment in different ones of the product segments, in dependence on step (c), in a direction that drives toward improved profitability.
[0064] According to some but not necessarily all disclosed embodiments, there is provided: a method for managing a retail operation selling multiple product categories in multiple retail locations, comprising: a) identifying heartland customers, who are net promoters of the retail operation; b) identifying battleground customers, who shop with the retail operation and also with competitors; c) for both heartland and battlefield customers, and for specific ones of the product categories, and for specific ones of the retail locations, analyzing transactions to thereby derive customer behavior sensitivities to different specific elements of the store's proposition, including at least promotion, price, and quality; and segmenting customers into subgroups, according to their sensitivity to different specific elements of the store's proposition; and d) modifying the investment in different ones of the product segments, in dependence on step (c), including the identified subgroups of customers, in a direction that drives toward improved profitability.
[0065] According to some but not necessarily all disclosed embodiments, there is provided: a computing system which receives data on specific retail transactions with at least some customer identifications, and accordingly for different specific customers, identifies different specific retail transactions for each, and groups customers into subgroups, not only by net promoter score and by store, but also by the sensitivity of the customers to particular elements of the retail proposition, and determines, for specific combinations of said subgroups with store location, actions which will predictably increase margin for individual ones of said specific combinations.
[0066] According to some but not necessarily all disclosed embodiments, there is provided: a computing system which receives data on specific retail transactions at multiple retail locations with at least some customer identifications, and accordingly for different specific customers, identifies different specific retail transactions for each, and groups customers into subgroups, not only by net promoter score and by location and by product category, but also by the sensitivity of the customers to particular elements of the retail proposition; wherein the particular elements include at least price, quality, and promotions; and accordingly determines, for specific combinations of said subgroups with store location and product category, actions which will predictably increase margin for individual ones of said specific combinations.
[0067] According to some but not necessarily all disclosed embodiments, there is provided: a computing system which receives data on specific retail transactions at multiple retail locations with at least some customer identifications, and accordingly for different specific customers, identifies different specific retail transactions for each, and groups customers into subgroups, not only by net promoter score and by location and by product category, but also by the sensitivity of the customers to particular elements of the retail proposition; wherein the particular elements include at least price, quality, and promotions; and accordingly determines, for specific combinations of said subgroups with store location and product category and net promoter type of specific customers, actions which will predictably increase margin for individual ones of said specific combinations.
Modifications and Variations
[0068] As will be recognized by those skilled in the art, the innovative concepts described in the present application can be modified and varied over a tremendous range of applications, and accordingly the scope of patented subject matter is not limited by any of the specific exemplary teachings given. It is intended to embrace all such alternatives, modifications, and variations that fall within the spirit and broad scope of the appended claims.
[0069] None of the description in the present application should be read as implying that any particular element, step, or function is an essential element which must be included in the claim scope: THE SCOPE OF PATENTED SUBJECT MATTER IS DEFINED ONLY BY THE ALLOWED CLAIMS. Moreover, none of these claims are intended to invoke paragraph six of 35 USC section 112 unless the exact words means for are followed by a participle.
[0070] The claims as filed are intended to be as comprehensive as possible, and NO subject matter is intentionally relinquished, dedicated, or abandoned.