Two B2C industries who can benefit the most from adopting a customer data platform (CDP) include the retail and automotive sectors. This should not be surprising since these global brands typically have thousands, if not millions, of customers, who need to be understood and communicated with across a variety of online channels.
In both industries, optimizing customer experience, lowering cost and improving ROI are always top priorities. This typically manifests in lowering customer-acquisition costs (CAC) for prospects, and making better use of customer data to improve the efficacy and efficiency of customer-centric marketing campaigns.
In both industries, but especially so in automotive, a trend in reducing CAC by focusing on retention and life-time-value (LTV) has been prevalent as CAC costs have risen by 50% over the past five years. For retail, the desire to target down to a single unified customer ID across all touchpoints has been a holy grail of sorts that CDPs are making a reality.
The following case studies illustrate how automotive and retail companies have leveraged CDPs to not just reduce CAC and cost overall, but to improve trust and long-term relationships with their customers with an increased focus on life-time customer experience.
Related Article: Why Your Customer Experience Strategy Needs a CDP
Subaru – An Automotive CDP Case Study
Subaru is a company whose reputation is built on the quality and reliability of their vehicles and a dedication to customer-centric marketing based in trust. Like others in their industry, Subaru is dealing with ever-present market pressures and automotive-development costs that continually challenge the company’s profit margins.
Looking to improve efficiencies by reducing CAC and improving marketing ROI, Subaru’s goal was to make better use of existing 1st and 3rd-party data to improve the customer experience (CX) across all channels — from websites to dealerships to advertising on various media outlets. In addition to reducing cost and improving ROI, Subaru puts a premium on customer loyalty and LTV. They know their loyal customers are their most vocal proponents; in fact industry studies place Subaru among the leaders in customer loyalty.
Tomomi Nakamura, CEO of Subaru, says such customer affinity comes from trust based on drivability, safety, and vehicle durability. Subaru’s commitment to its customers includes their desire to have a meaningful interaction with customers from their first interaction with Subaru through a years — or decades-long relationship.
Saito Kazutaka, GM of Digital Innovation at Subaru, says data management is critical to delivering that experience. “We first implemented the Arm Treasure Data Enterprise Customer Data Platform (CDP) to unify customer data for operational improvement and web optimization. Since we began using Arm Treasure Data in 2016, we’ve unified more than about 200 data points and 80 billion data records. We currently collect more than 8 million new transactions daily, across the entire customer journey. Today we place particular emphasis on capturing post-purchase driver data and feedback for use in the development of new products and services. The volume and variety of data we collect help Subaru build customer loyalty and distinguish our brand for success in a highly competitive transportation market.”
When you are talking about billions of data records and millions of daily transactions, a scalable enterprise-grade CDP that can handle that volume is required for such demanding use cases, according to Subaru’s Chief Engineer of Digital Innovation.
Ogawa Hideki, Chief Engineer of Digital innovation, Subaru says, “Arm Treasure Data also gives us enterprise-grade scale. With the expansion of 5G networks, we expect to collect a significant amount of connected-car data, likely at a volume and frequency comparable to log-data collection. Arm Treasure Data CDP is the only platform we’ve found that will handle that scale of data collection as quickly and flexibly.”
Consolidating customer data in the Arm Treasure Data CDP helps the Subaru team develop more meaningful connections with shoppers, enabling delivery of the right content at the right time.
“Our marketers originally started using IT technologies like the Arm Treasure Data CDP to help make operational improvements. We continue to fine-tune for efficiency, but we’re much more focused on using data to create value and build lasting relationships with our customers,” Mr. Hideki says.
Shiseido – A Retail CDP Case Study
Shiseido is a global beauty brand who is preparing to celebrate its 150th anniversary. Their goal in examining CDP solutions was to unite customer data from disparate silos to build segmented marketing loyalty programs and to send customers relevant, personalized offers to support revenue growth. To accomplish this, Shisedo needed to update their existing customer loyalty program with a one-to-one marketing program fueled by digital customer data.
Launched in 1937, Shiseido’s customer loyalty program has been at the center of their customer communication and branding strategy for over 80 years. In 2012, they added a digital component, and by bringing their loyalty program online, they also brought along a lot of new data.
To keep up with changing customers’ needs and behaviors, the company deployed the Arm Treasure Data Enterprise CDP to analyze historical purchase data, demographic data and recent customer behavior. But beyond the ability to unify 1st and 3rd party data together, additional benefits of the Arm Treasure Data CDP included a lowered need for engineering time, and ownership of the customer data platform by the marketing team.
Kenji Yoshimoto, Chief Analyst for Direct Marketing, Shiseido says, “Our new customer data platform built on Treasure Data is fundamentally changing how we communicate with our customers. Blasting emails to everyone who tried samples or bought a particular product won’t lead to customer delight. Detecting a mood swing in each customer and changing the tone of push notifications does.”
Embracing a CDP and being able to leverage all that new digital customer data has had a profound impact on Shiseido’s revenue. Since the efforts were underway, Shiseido saw a 20% in-store revenue increase and a 38% growth in net income YOY.
Both the automotive and retail industries have embraced CDPs, which have enabled them to unify customer data to improve the customer experience, all while reducing costs and improving ROI. For Subaru, who values long-term value and trust with their customers, the CDP has allowed them to understand and communicate with their prospects far before they step into a dealership, and long after purchase, to improve LTV. For Shiseido, the ability to deliver one-to-one marketing to their customers through their loyalty program has improved the efficacy and efficiency of their personalized messaging campaign, leading to increased revenue through their loyalty program.