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Whole Foods illustrates the challenge of late-stage CRM integration

Evan Schuman | June 19, 2017
What happens when a US$16 billion, 37-year-old chain wants to tackle CRM for the first time? Whole Foods is about to find out.

That POS integration touches heavily on terminal memory modules - "to handle the logic needed to activate a loyalty program" - plus integration of payment methods as well as mobile and web systems, Ciancio said.

Within payments, there is the ever-present debate of whether it's wise to piggyback loyalty atop specific payment mechanisms. For example, if the chain already associates a specific Visa card number with a specific shopper, why insist on a separate loyalty identifier? The card value still needs to be hashed and secured (you don't want PCI-protected sensitive data to be sitting in CRM files within marketing), but isn't that simpler?

The counter is that customers often have multiple payment cards (and they might use PayPal or some other alternative payment system online and with mobile) so you start to lose the consistent view of the customer by leveraging payments.

Although it doesn't impact Whole Foods at this time, the issues get more complicated with chains that have pharmacy departments, which ensnares them in even more restrictive HIPAA rules. A shopping cart with three prescription refills, two boxes of tissues and some over-the-counter cold pills must omit any prescription details from the CRM files.

As for what to start with, Ciancio simply suggests, "Start with what you've got. POS data alone, even without card IDs, is a really rich place to start." This gets into one of the better - and often overlooked - uses of CRM data: making strategic choices about which SKUs to renew.

This might be a case where a particular product isn't selling well at all, but the people who are buying it are among your highest-revenue regular shoppers. Before you alienate some of your best customers, maybe it's better for a category manager to just leave that broccoli-flavored toothpaste on the shelf.

Ciancio pointed also to associated purchases. He cited a small size of Frosted Flakes that may not move well, but it's a popular item with budget-conscious shoppers and it brings with it many other related purchases. Integrating CRM analysis can make those kinds of connections more obvious.

When CRM programs don't work well, Ciancio said, "most fail because they are seen as just a marketing tool" and are not integrated into other store systems.

There's actually a good reason to start anew and that is if management believes that its existing system data is flawed. For some, Ciancio said, "my data is good enough to make the decisions that I need to make" while others concede the opposite: "I know my data's a mess, and we can't do anything with it."

 

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