This article is a think piece, meaning it’s intended to provoke thought and contemplate customers in a different way. It’s impossible not to speculate when pondering shopper behavior. Data tells us the “what” but not always the “why.” With the overwhelming amount of consumer data that exists today, the question becomes how to absorb it and channel the data into meaningful, usable bits of information.

Sometimes a story or research triggers you to think and connect information in a new way. Indeed, that is precisely what prompted this story: another story. An article in Harvard Business Review, “What You’re Getting Wrong About Customer Journeys,” engrossed Lori Buss Stillman, NACS vice president of research. The content immediately struck a chord with her affinity for c-store analytics, and the connections to convenience retailing kept coming as she continued through the article’s framework of a customer journey matrix, which outlined different experiences marketers can create to target consumers (see sidebar: The Story That Prompted a Story).

“For me, that article just connected on many different levels and brought new thinking on customers and journey maps and how technology has allowed all of it to be more personalized and directed today,” said Stillman.

This is not a story designed to give you all the answers but instead fill you in on some new ideas that others are talking about—and executing—to draw you into the conversation so you can in turn engage your team in this conversation. For some readers, this information will prove a box they can already check. For others, it may seem a bit aspirational. Either way, time spent re-examining the customer journey is time well spent.

Customers change faster today, and their triggers to buy from you are different."

BEHAVIORAL SEGMENTATION

Understanding the customer journey directly connects to understanding the customer, of course. The process of sorting customers into behavioral segmentation has been ramping up to something convenience retailers—all segment retailers, actually—are doing more frequently, according to Jason Zelinski, client director, convenience and growth accounts, NielsenIQ. “Retailers used to plan out and assess behavioral segmentation maybe every three or four years, but now I’m finding many retailers are doing this every year. The behavioral triggers of the different segments are changing faster now, so waiting two years is just too long. Those customers change faster today, and their triggers to buy from you are different.”

The idea of behavioral segmentation is to break consumers down in different lifestyle groups. For example, empty nesters and impulse shoppers have different shopping patterns, Zelinski notes. “Those customers are vastly different, and their triggers to buy from you are different. Once you determine how much of your business is made up of the segments you define, then you can determine which segments are worth defending and which you may not care that much about.”

Simply put, Zelinski believes audience segmentation drives better business decisions, particularly when it comes to marketing and making sure the messaging is on target, in addition to having the right product on the shelves. Naturally, the pandemic had an impact on this. Shopping patterns changed throughout that period. For example, Zelinski points to a “newly cautious” customer segment that evolved from consumers who had money but were uneasy about spending it. Now NielsenIQ identifies “rebounders” as those who are back on their feet with spending habits.

“The whole way people are shopping has changed every single year for the past three years,” Zelinski notes.

As much as the way consumer shopping patterns are changing, so too is the way c-store retailers are approaching the role they play in guiding the customer journey. In similar fashion to the “first comes love, then comes marriage” lyrics, first comes gaining a grasp of the different customer segments. “Creating a successful digital marketing strategy should start with a strong understanding of the different customer segments visiting a particular c-store,” said Mike Novosel, head of industry, gas, grocery and convenience at Cardlytics. That means looking at the accumulation of data, which often comes via rewards programs. “One of the best starting points is a loyalty program,” he said. “By starting there, brands can get an immediate understanding of who visits each store and their behavior, which lays the foundation for what will over time become an intentional, individualized marketing strategy.”

Once a strategy aligned primarily with only the most tech-sophisticated and large c-store retailers, today digital marketing’s value is viewed by even midsize operators as a key way to help shape the customer journey, according to Novosel. “Last year, I noticed an increase in digital marketing strategy among more regional c-store chains,” he said. “They are now seeing the value of having a loyalty program and looking at being more intentional in who they market to through that approach. That’s where digital tools come into play as incremental sales drivers and targeted marketing.”

It’s about establishing a more conscious, focused marketing target, Novosel said. He points to Casey’s as a leader in that arena. The retailer’s scale—more than 2,000 stores— grants it the critical mass to be able to react to the data accumulated from customers. Even then, Novosel said, it only yields a certain level of loyalty penetration. The challenge becomes remaining laser-focused on how to reward customers that spend every day, “which can be a challenge for even the best of the best when using digital marketing,” he said. “And it is an even greater challenge for chains wishing to move the bar today due to a talent gap in resources. You really need someone long term on your team who specializes in digital marketing.”

We look at the customer journey and how we can influence that journey once customers have joined."

CASEY’S JOURNEY

Unquestionably, Casey’s has put the resources behind understanding how to advance the customer journey with a digital-first philosophy led by Art Sebastian, the Iowa-based retailer’s vice president of digital experiences. “We’ve made great progress in the last four years,” he said, which includes the launch of the retailer’s loyalty program in 2020, relaunching its website, adding curbside pickup and delivery options and, most recently, testing kiosks as an ordering solution in stores.

With more than five million rewards participants (Casey’s reported 5.5 million members in its fiscal first-quarter earnings report September 7), the program has quickly established itself with customers. While the five-million mark brings with it an immense amount of data, the rewards piece does not actually serve as the primary entry point for Casey’s, says Sebastian. Instead, the first step begins with building awareness of Casey’s in the market. Joining the rewards program reflects the endgame (or better yet, prompts the next level of marketing). “Ultimately, we want to recruit customers into the guest funnel,” Sebastian explained, which begins by looking at the base of potential customers within a five-mile range of a store. After building awareness, the next filter is to draw those customers into the store.

For Casey’s, pizza frequently prompts the first entry, specifically via digital ordering. “Ordering a pizza through our website is a common entry point,” Sebastian said. “Pizza is a unique part of our business and what we are most known for. Other ways people funnel in are by subscribing to our marketing channels or downloading the mobile app. Then that leads to them joining the rewards program.”

The approach Casey’s takes follows much of what has become a traditional sales funnel model, which guides prospects through the funnel (widest at the top with awareness and narrower toward the bottom as the potential customer converts to an active customer). It’s a visual metaphor often referenced in sales and marketing teachings, and yet another way to think about the customer journey.

While a large chunk of Casey’s digital experiences team works on acquiring a broader base of rewards members, another part of the team focuses on engagement, Sebastian says. “When looking at engagement, we have a very high active rate. Our engagement metrics are actually better than some large QSR brands.” When asked what he considers more important, acquisition or engagement, he leans toward engagement. “Both are important, but we want to engage more with those that joined the rewards program,” he said. “We have several behavioral segments available to us and leverage that to create the right audience and guide behavior. We look at the customer journey and how we can influence that journey once customers have joined. We want customers to transact business with us as a routine.”

Even operators without the scale and resources the likes of Casey’s can work toward a better mastery of the customer journey. Sebastian points to transaction-level data as one opportunity, as well as considering white-label options as an entry point into digital engagement. “Smaller operators can even look at their base of transactions and consider how to market to a select group,” he added. “For instance, the data may show a subset of customers use the store for a morning coffee run or as a tobacco convenience run. From there, it’s about how to communicate to customers based on those trip types,” he said. “I do believe, however, that any size operator can benefit from making digital a priority.”

For Casey’s the next frontier lies in personalizing experiences. “There is so much opportunity with personalization,” Sebastian said. “We also see an opportunity to digitize the team member experience. There is a whole other world we can still tap when it comes to digitizing experience. Digital is more than e-commerce and loyalty programs.”

The next move is to focus on new ways to engage shoppers for more influence over that journey."

WHEN THE JOURNEY FLATLINES

The most common trend line Novosel finds in his work with large chains, including c-store, grocery and big-box segments, is that after the initial launch of a focused digital marketing effort to guide the customer journey, the program starts to stagnate. “As they come to the tail end of driving more sales from their most loyal consumers,” he said, “the next move is to focus on new ways to engage shoppers for more influence over that journey.”

One example of a large chain that no longer customizes the journey is Bed Bath & Beyond, Novosel says. “That’s not a selective program; the 20% off coupon is given universally.”

Retailers of all levels can take a hard look at how they engage with consumers today and determine where there are nonintrusive opportunities to learn about them, Novosel advises. Think breadth and depth, he said, latitude and longitude. “How you talk to customers depends on where they are on the spectrum,” he said. “Understand the need state. Am I the customer who doesn’t show up frequently, but I fill my basket in a big way when I do? Or am I the customer who always shows up on my way to work for coffee?” This is a common way to think about shoppers when it comes to merchandising, he added, saying digitizing that just means thinking about it within the context of data architecture.

While some convenience retailers still may find this a bit aspirational in terms of commitment, consider that, at the core, it’s about evolving the culture of how to think about the customer journey. Whether that means going full steam ahead with tactics and technology or considering the inherent characteristic of customers, starting the internal conversations about the customer journey will never steer you wrong.