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OUR BLOG

07 Jan 2020

How Lowe’s is Overcoming the Biggest Problem in Digital Analytics

Let’s face it. It’s still hard to measure marketing.

In fact, it may be harder to measure now than it was 20 years ago simply because there are so many marketing channels today. We still have the old stand by’s: print, radio and TV. But add to that the 100’s if not 1000’s of channels that drive acquisition through the web and you’ve got a mess on your hands.

Too much data and not enough time in the day to sort through it all.

But the enormous challenge of sorting through big data isn’t the core of the problem. The real issue is caused by something called the primary key.

The “primary key” dilemma

Put simply, a primary key is a unique ID that separates records in a database. Every record (customer, transaction, product) in a functioning database has a different identifier.

For example, if you have a soup restaurant you might have a database that looks like this,

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Notice that every person that purchased from the soup restaurant has a unique ID in the database. It is their primary key and it allows us to differentiate one record from another. In the example above, if Jerry returns to your soup restaurant and purchases Lentil Soup, the transaction could theoretically be assigned to the record with the primary key ‘12345.’

But how do we develop a process whereby we are able to continuously track Jerry’s purchasing behavior in the restaurant? It seems simple until you start dealing with the reality of multiple customers and, perhaps, multiple locations.

The problem becomes even greater when you introduce a second method for purchasing products. If we begin to sell our soup through our website, we might end up with a second database that looks like this,

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The second database doesn’t know that you already have a record for Jerry in the first database. And the mess gets bigger.

How Lowe’s is solving the primary key dilemma

I set out early one morning to my local Lowe’s Home Improvement store determined to knock out a big landscaping job. Several hundred feet of new flower beds needed some edging.

I loaded my cart with 200+ bullet edgers and wheeled it up to the checkout counter.

During the checkout process, the clerk glanced in my direction and said,

“Do you want to sign up for a MyLowe’s card? It keeps track of your purchases so you’ll always have access to the paint color you bought for your bedroom or the make and model of the ceiling fan you installed. It also stores your receipts, which makes returning items a breeze.”

Sounds good. Sign me up.

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But this program is much more than a tidy way for me to keep track of my home improvement purchases. It’s a marketing mammoth.

My Lowe’s solves the primary key dilemma.

Here’s how…

How MyLowe’s works

When you sign up for a MyLowe’s card it creates a record in their database with a single primary key.

Here’s what it looks like when you log into the website. The MyLowe’s Card Number is my primary key.

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But the magic doesn’t happen until I make a second purchase and, of course, use the MyLowe’s card. Each time I purchase from the store, my purchasing behavior is connected to the same record in the database.

Now they’ve got something.

After my landscaping job was complete I needed some patio furniture to sit on and admire my work. So, I grabbed my laptop and headed over to Lowes.com.

Wouldn’t you know it? During the checkout process I was directed to log into my MyLowe’s account.

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Now they’ve connected my in-store purchases with my online purchases. Brilliant!

But, of course all of this data is worthless unless you do something with it.

About 48 hours after purchasing my patio furniture I got an email from Lowe’s with the subject line “It’s the Perfect Time for your Perfect Yard.”

Coincidence? I think not.

This is a well timed, relevant email that is tailored to my past purchasing behavior. And, of course, my behavior within this email (opens, clicks, etc) is all tied back to my primary key. This is the new era of marketing.

Here’s what the email looked like,

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The data that is being collected through MyLowe’s can be used to generate more targeted print ads that arrive in my mailbox. If they aren’t doing it already, rest assured, they are working on it.

Why does MyLowe’s work?

A couple of years ago Panera Bread started a very aggressive loyalty program. Computers were set up inside the restaurants for easy activation of your Panera Card and employees were hell bent on getting every patron to sign up.

And the rewards for signing up were compelling. For the first couple of weeks using the Panera Card I earned free pastries, smoothies and cups of coffee.

Panera was determined to make this loyalty program work, in part, because if solves the primary key dilemma.

The Panera and Lowe’s examples have something very important in common. They both go to great lengths to incentivize the customer to sign up. The primary key problem can be solved but only if the customer sees a benefit in participating.

The trouble with measuring marketing today isn’t a lack of data. The problem is too much data that can’t be connected. To get downright technical about it, the problem is that there are too many separate databases holding that data.

Think about how you could incentivize your customers to solve your primary key dilemma. Incentivize them to participate. After all, if you solve the primary key dilemma, your data will look like the below and imagine what you can do with that.

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Reference: https://www.digitalmarketer.com/blog/problem-digital-analytics/

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