Dunnhumby wields Clubcard data for marketing optimisation

UK-- Tesco Clubcard data is being used by Dunnhumby in a new service that claims to pinpoint the actual sales impact of marketing campaigns.

Marketing Mix Optimisation (MMO) bases its analysis of marketing effectiveness on the purchase behaviour of the 13 million UK households that take part in the supermarket chain's customer loyalty scheme.

Dunnhumby uses test and control groups to see whether there is any noticeable increase in product sales in a region where, for example, a TV advert has been aired, against one where it hasn't.

By doing so, it aims to help advertisers identify the best-performing parts of their marketing mix, and tailor their campaigns accordingly.

It has echoes of Arbitron and Nielsen's joint Project Apollo initiative in the US, which uses a single panel of consumers to track both media exposure and purchase behaviour. But while still at pilot stage, Apollo's 5,000 reporting homes provide just a fraction of the sales data available through the Clubcard database.

Dunnhumby's head of communications and media, Jeremy Caplin said most behavioural databases “are frankly too small” when it comes to making multi-million pound investment decisions.

He gave the example of a brand that has a penetration in excess of 5% of households – something only 10% of brands can boast. On a panel of 25,000, this would have a sample size of around 1,250, said Caplin.

“If this is then split into test and control groups, when looking at the performance of a specific ad within a specific slot, sample sizes become very small, severely impacting on confidence intervals,” he said. “With a panel of 13 million, you never have this problem.”

Dunnhumby has managed the Clubcard database since it was launched in 1995.

Author: Brian Tarran

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