Targeting and Engaging Key Customer Segments | DRB®


Transcript

 Dave Kuchenski, Vice President of Strategic Product Management, DRB: Good afternoon, everyone. Welcome to DRB's webinar on Targeting and Engaging Key Customer Segments. Thanks for joining us today. We're going to give people another 30 seconds or so to join and we'll go ahead and get started. Just a little bit of an introduction. I'm Dave Kuchenski, Vice President of Strategic Product Management at DRB, and with me is Ali Amira.


Ali Amira, Senior Director of Product Management, DRB: Hi everybody, I'm Ali Amira. I'm Senior Director of Product Management at DRB, overseeing applications like Catalyst that we'll talk about today. So thanks so much for joining us.

Dave: Okay, so let's dive into segmentation a little bit. So segmentation is personalization. When you segment your customer base, it's likely not a surprise to most of you that personalization has become highly integrated into our everyday lives. For brands like Amazon, Netflix, who deliver seamless personalized content every day to Peloton and Spotify who continue to elevate the ways that they engage their audience as consumers, our expectations have changed based on these emerging technologies and these experience. With that being said, 76% of consumers get frustrated when they don't have a personalized communication. 49% of Gen Z say they're less likely to make a purchase and 27% say they will stop shopping with a brand altogether if they've had a very impersonal experience. Over half of consumers say that they will become repeat buyers after personalized experiences. And so what does this mean? If you don't offer personalized messaging, you will eventually lose those consumers to someone who does. To deliver personalized messages, you must segment your customer base appropriately and pull through highly targeted, meaningful, relevant content so those consumers feel a direct connection to you and your brand. So today, we're going to talk about how we deliver those experiences, those highly targeted online and online customer experiences, both onsite and digital. The delivery and execution of this can be easily managed through new features about to release in Patheon and our new marketing application, Catalyst, which Ali is the product manager for here at DRB. Whether it's a customer's first visit three months into their membership or a retail customer with various methods of how you engage them, your customers in meaningful ways, and to provide those, the strongest experience is essential to implement the tactics, both onsite and online. And we'll keep hitting on that onsite and online methodology. A lot of people refer to it as omnichannel, how digital and physical channels blend. But utilizing Patheon, we'll talk about not only how to collect customer contact information on the XPT, but how to deliver highly targeted promotions as the customer pulls up to your kiosk. This will ensure that you provide a highly targeted onsite experience that is more likely to result in membership conversion, retail loyalty, and other important business objectives.

Ali: Yeah, and with Catalyst, we'll really focus on the digital experience to continue that engagement by sending customer's targeted email and text campaigns after that onsite visit. And this is going to really help drive conversions, loyalty, and lifetime value. So more to come on this in the next few slides. All right, so before we get into the nuts and bolts of everything between Patheon and Catalyst, let's take a step back and ground ourselves in your business objectives. So in the car wash industry, there are likely three main objectives when operating your wash. And these are probably no surprise to anyone on the line. But first of all, driving new memberships huge priority, constantly a theme that we talk about and we hear about from operators, so that's, of course, number one. Reducing membership churn and increasing that lifetime value. So how do you keep members in that membership for as long as possible? And then increasing retail engagement and loyalty. So when we think about the customers who aren't on a membership yet, or maybe will never become a member, but highly valuable customer who's continuously buying a single wash or wash books, how do we increase that engagement and loyalty throughout that journey? And probably much of what you do every day is laddering up to these goals. So in order to drive these goals, we have to really target customers appropriately and pull through that personalized content and messaging to ensure we're providing an optimal customer experience. So, let's dig into how we do this a little bit more.

Dave: Yeah, so let's talk about driving new memberships and kind of a window of opportunity for retail capture here. So probably something you talk about often. Let's start by focusing on the onsite experience and then Ali will dig into the digital experience a little bit more. But did you know that roughly 48% of your members enrolled during their first visit? After that, 40% of your membership base will enroll within the next 90 days. So it's imperative that we capitalize on both that initial visit onsite and then the next 90 days post-wash, both onsite and digitally. So let's start with the first visit. How do we capitalize on that first visit? Using LPR segmentation and Patheon and Patheon's upcoming personalized promotions feature, we'll be able to identify when it's a customer's first visit. So now, this is the perfect moment to deliver a welcome message and a membership discount on that kiosk. So if you can get them to bite the hook, you can also get them to enroll in SMS marketing upon membership enrollment, and this will allow you to keep messaging to them after they sign up through Catalyst. This is going to be the key to tracking their behavior and hitting them with targeted messages throughout their customer journey. But we'll get into more of that later. And so let's take a look at another example, so a retail customer who's washed two times or more in the last 30 days. So when that license plate pulls up, Patheon can recognize how often that license plate is coming back or that consumer's coming back and we can see how many dollars they've spent with you, how many times they've been back. Based on all that information, we can promote to those customers. And they're a strong candidate to deliver a membership promotion on the kiosk. So we can say, "Hey, you've been back "to the wash multiple times. "Let's give you a deeper discount than potentially "what we would give our normal members." Because we know that they're already relatively loyal to your organization. And so it makes sense for us to try to go ahead and capture them into a membership. And the XPTs using LPR can recognize those consumers and get them into that membership.

Ali: Yeah, so once we've gotten them into a membership program, the next goal is to reduce churn and keep them in the membership for as long as possible, like I mentioned before. So through the point of sale system and the data we're collecting on each member, we can easily identify key moments in the journey and use Catalyst to deliver essential messages based on that behavior. So let's look at a few examples. So let's talk about members who haven't washed in the last 45 to 60 days. So it's likely that customers who don't use their membership are going to churn out. So rather than lose them all together, deliver a down sell offer and try to retain them. It's better to keep a member at a lower tier than lose them all together. So it's important that we send that messaging, that we continue to communicate with them, prove our value, or try to get them on a lower tier. And that can all be done through a text message because you've captured that data and that data is synced directly into Catalyst where you can easily configure that campaign and that automation. Another really low-hanging fruit here is members whose credit card are going to expire soon. So this is a transactional message that we can deliver via text or email, reminding them to update their credit card 'cause it's going to expire, and give them a link to easily update that information. So that proactive automated communication is key to minimizing involuntary churn. Another group that I just want to touch upon here when we think about membership churn, so members who are actively using their plan, they might not seem that they're actively at risk for churn and they're probably not, but we know that majority of consumers will only stay in a membership for roughly nine months. And that's not because you did anything wrong at the wash, but the membership doesn't necessarily last forever. So what we want to do is do everything we can to keep them in that plan for as many months as possible. Every extra month that you get after that nine-month milestone is really increasing that lifetime value and really seen as like an upside to your overall revenue. So even when a customer isn't likely to churn necessarily, but they're encroaching on that nine-month timeframe, you can send them a message recognizing their membership milestone and this element of personalization that really is helping show your appreciation and their loyalty for being a loyal member is going to help drive that brand sentiment, that positive sentiment with your organization and keep that engagement going. So like I kind of said, it's better to have that communication than just let them churn out. If a customer is determined to leave, they're going to leave, but really kind of driving that engagement is hugely important for increasing that lifetime value.

Dave: So I want to talk about increasing retail engagement and loyalty and potentially for customers who aren't necessarily interested in a membership or don't want to be locked into that, or maybe they're early in their journey and they're just not ready to commit yet. We should never alienate our retail customers. It's always an important segment. Whether your retail traffic is 20% or it's 60 to 70% of your retail traffic or somewhere in between that retail base is still a really important one to pay attention to. They contribute a significant amount of revenue every month and they should be an integral part of your overall loyalty strategy. Many customers experience membership fatigue or subscription backlash. And what we mean by membership fatigue is the average consumer has somewhere between eight and 12 memberships or subscriptions that they subscribe to. Everybody kind of hits that point where they're like, "I've just got too many things coming out of my bank account on a regular basis." "I really need to go evaluate those things." I'm going to keep these top four or five subscriptions and these bottom five or six ones." "I don't really use very often." And so that's when they go ahead and do the membership fatigue or subscription fatigue. They go ahead and cancel their memberships. And so the question is, how do you provide value and recognize those and take action prior to them actually churning out. And so there are multiple ways to drive repeat retail visits for those customers who don't want a membership through personalized campaigns and offers. At the basic level, you can use LPR to track visits history and reward customers for their continued visit. A good example is, there's this concept of invisible loyalty. And if you think about traditional retail establishments, Chipotle is a good example. In order to get Chipotle rewards, I have to go onto my app. I have to go in. I have to scan a barcode. I have to maintain that as a consumer along with the other 10, 15, 20 places that I potentially eat lunch at or shop at. And so with invisible loyalty in the car wash, we can utilize LPR to track those consumers. And so we know how much they're spending. We know when they come back. And with the new XPT Promotions feature in Patheon, we'll be able to basically present promotions based on how often that consumer is using your wash. And so let's say, we advertise the fourth wash is free. Consumers don't need to scan a barcode. They don't need to track visits. Basically, the fourth time we see that vehicle, we can go ahead and present them with a free wash. So imagine if you went into your local Chipotle or food destination and you basically said, you walked in, you ordered your burrito, and the cashier was like, "Dave, this one's on us today. Thanks for your loyalty." As a consumer, that's a very delightful experience. I didn't expect it, but that retail establishment, they chose to reward me for my behavior. They recognized me and they actually gave me a reward for being a repeat user. And so it's those types of experience that I think can differentiate your consumer journeys and how consumers feel about your brand. And so we really think that recognizing those consumers and rewarding them in a way that's positive that maybe they don't expect is a really positive consumer experience. Subscription fatigue, so we enhance the consumer experience by providing options. So for a retail customer who's washed multiple times in the last 30 days, we've tried to get them to be a member. They're just not going to be a member, but they keep coming back, and that's okay. How can we make that consumer's experience better? So in Patheon, we've got something called Pego. This allows the consumers to basically register their credit card, register their favorite wash, and store their vehicle, their license plate, or an RFID sticker against their vehicle. And every time they show up, the gate is going to go up similar to the way a membership experience would happen, but without the commitment of that subscription. We'll build the card every time they come back and that customer is receiving a very seamless type of experience with your wash. So it's just a way for us to really deliver differentiated experiences to those retail customers.

Ali: Awesome, so let's talk about increasing share of wallet. So this is, again, taking it another step further. So you've gotten them into a membership, for example, but how do we really increase that wallet share upon getting that enrollment? So there's always ways to upsell, but ensuring you're upselling the right thing to the right customer is what's going to drive a higher conversion and allow you to really hit on that personalization and best possible experience. So once a customer enters into a membership, there's really two great ways which you can get them to upsell or increase wallet share. And that's either to upgrade to a higher tier membership or to add a car to the plan. So let's say you have a new member who joined in the past 14 days and they've already washed two or three times. So this customer clearly is seeing the value in their membership and they're likely to add another vehicle to the plan. So this is a great time where you can message them and educate them on how they can easily add an additional car to the plan, whether it's through something like the Beacon Mobile app or the e-commerce pages on Patheon that we call the EWA. This is something that they can do themselves and will really allow them for best possible experience and for you to help increase that wallet share. Similarly, we can recognize that a member of a lower tier plan is actively using their plan three or more times a month. And you can deliver a message to upgrade them to the next level tier and why it would make sense for that member specifically to move from the lower tier to the higher tier. So pulling through the insights that you know about the differences in the tiers and making that content very clear and insightful to your customer is going to have them respond in a more positive way and really help deliver that action that you're looking for. So it's really taking that data point, utilizing it in Catalyst, for example, where you can follow up with them in a campaign and really pull through that personalized messaging. So, hey Dave, on the bronze tier, we see that you're continuously coming and you can get more bang for your buck when you move up to the gold tier membership. So really kind of pulling through that insight and data is going to help drive that action. And then let's talk about recapture. Recapturing members who have turned out of their plan. Nobody wants this to happen, but it is, of course, going to happen. Members churn out for different reasons. It could be involuntary or voluntary. And upon canceling, we really want to make sure that we're adding that member or that customer into a segment that will allow us to send a recapture offer. So let's say we want to send an offer three weeks post-cancellation. We can get really targeted with that communication based on how they engage with the content. So for example, we can see through Catalyst if they've opened that email with that recapture campaign, if they've clicked through and then dropped off, if they've redeemed a barcode in the past. This level of detail and insight is really going to help us maximize our recapture rate. And if the customer doesn't sign back up, we can add them to a retail loyalty segment to nurture and continue a relationship post-membership. Just because they don't want to be a member doesn't mean that they aren't a valuable customer. So we want to win the future customer, and how are we going to do this? We really want to take the time to talk about these key initiatives that have been tailored to deliver a more personalized targeted experience. So McKinsey recently published their state of the consumer report in which they hit on this topic exactly. So building microtargeting capabilities is what they talked about. And rather than putting customers into a predefined and often outdated box, it's important that we focus on microtargeting to build a richer understanding of our consumer preferences. So this involves taking a smart reach approach whereby consumers can really utilize that business data and target specific needs of the customers that demonstrate a particular shopping behavior. So through microtargeting, companies can engage with high potential consumers. And that's what we're doing exactly with Patheon and Catalyst today. So really honing in on those microtargeting capabilities and tailoring offers and messaging based on that data that you're getting through Patheon. DRB has a portfolio of products that we've talked about, Patheon, Catalyst, Beacon, LPR. And we really are speaking directly to how we are enabling car washes to address the evolving expectations of the customers for both today and tomorrow. So hopefully, this really helped provide that insight for you, guys, as to how we're leveraging our existing technologies and features that are to come on the Patheon side. And definitely, open to any questions that you, guys, might have now.

Dave: Okay, so Ali, we have a few questions here. One, how can we capture this consumer information and data without using an XPT?

Ali: Yeah, so I can jump in on that one. So XPT is a great way to capture data, but is absolutely not the only way. And in fact, there's a ton of different kind of tactics that we can take for gathering customer data. So customers are putting in data also through the EWA, for example. So if you're a Patheon customer, you're probably familiar with the EWA. It's our e-commerce platform. So that's another area where you can get that. Through Catalyst, we'll also have a landing page generator so you can easily create landing pages in which customers can put in their data or put in their information and then get something in return for doing so. So that's something that's coming in Catalyst that we're excited about. Also, for SMS text marketing, a really easy thing that we help implement for our operators is keyword texting. So we provide you, guys, with a keyword that you choose, and then a customer can just type in that keyword to enroll into your SMS text marketing platform. And again, you can easily get customers to do this by incentivizing them upon enrolling, getting a discount or a coupon code that can be applied to their next purchase. So really strong way to continue to get that customer data. We can also utilize QR codes, which we hand off as part of the Catalyst implementation process as well. So upon when you scan that QR code, it's going to immediately generate a text to the phone number to opt in. So a handful of different ways in which you can really kind of amplify getting that customer information. So more to come on that front. It does not necessarily have to be through the XPT, but you're going to want to utilize as many of these platforms as possible so that you're getting as much data as you can.

Dave: So I have another question around a common reason for customers to cancel is them moving out of our service area. How can those accounts which are canceling for this reason be flagged so they don't end up in the recapture funnel?

Ali: Yeah, that's a really good question. Sorry Dave, were you going to go for that one?

Dave: No, so I know on Patheon, right now, we have a few canned reasons for cancellations that can be input as part of the cancellation process. We're actually launching customization to that. So you'll be able to put in your own reasons and deliver those via any of the cancellation channels so that you can really capture good data around why those customers are canceling. But Ali, I don't know if you want to add any more to that.

Ali: Yeah, that's also an enhancement that we've talked about between Patheon and Catalyst as well. So when a customer puts in that reason for cancellation in the EWA, if they put in that they're moving out of range, being able to connect that data so that the customer does not get put into a segment for a recapture campaign, that's something that we're going to be working on too. So Catalyst is launching in the next few weeks. It's actually launching July 8th. So if you are interested in learning more about that, we're happy to kind of kick that conversation offline. But that type of segmentation and that ability to finitely segment is where we're really trying to hone in and differentiate to ensure that you, guys, are providing the best possible experience to your consumers. So that's something that we've been talking about on our side as well. So happy that you brought that one up.

Dave: So I've got a question around the EWA, Ali. So with the customer portal, when will the customer portal be updated? I think they're referring to the EWA. It's been difficult to try to get online sales when the customers have to verify their phone number first.

Ali: Yeah, so that is another enhancement that is coming in the next few months. It's actively being worked on in Q3. We're calling that guest mode, so that will allow consumers to make a purchase without verifying that information. So that will be an option that you, guys, will be able to have and we're looking forward to bringing that to life. So like I said, actively being worked on right now and will be coming through shortly.

Dave: So can you expand on Pego? So is this an option that we can get to pop up after customer visits a few times that they can set up right at the XPT? Yeah, absolutely, that's a use case with the XPT promotions that we're looking at delivering. And so the use case there is customer comes up, maybe they've declined membership offers for several times, two or three times you've thrown the book at them. They don't want to become a member. Let's say they pick the best wash, the next screen that they could see would be, would you like to opt in to our Pego solution? Click here to save your card and your wash for your next visit and you won't have to interact with the screen anymore. So that's absolutely something that is a use case that we're delivering. So look forward to that coming soon.

Dave: So there's a couple questions around a lot of third party solutions, Ali. So the question is, how can they leverage DRB solutions to potentially consolidate on or replace existing partnerships?

Ali: Yeah, so definitely hear you. To Dave's point, a lot of what we're doing right now between the different Patheon features that we've talked about, about the self-service marketing application, Catalyst, this is really to provide you, guys, our customers with the ability to manage everything at your fingertips under one umbrella, one support team, one group who's going to help really, really implement these things for you, has functional knowledge and insight for how both Patheon works, Catalyst works, LPR, things like that. So our goal is to really provide as many of those solutions as possible so that you don't have to outsource and utilize third party. So a handful of ways at which we can really help consolidate for you. And I think that we can get into specifically offline as to what you're doing today and how we can meet those needs with the products that we have. But absolutely hear you that. For us providing all of the tools and services to help consolidate under one roof, we know that that's going to make a stronger experience for you as the operator. So that's absolutely the goal. And again, we can kind of dig into the details of what you're doing outside of DRB and how we can accomplish inside.

Dave: Yeah, good example of that is we recently made the decision to include transactional notifications to consumers as part of your Patheon subscription. So you can get 5,000 text messages and unlimited emails as part of the notification solution with Patheon. And so anytime your customer has an expiring credit card or a failed payment, you can customize text messages to be sent or emails to be sent to those consumers to either recapture a new card and that is all included with Patheon. So just continuing to provide value into the DRB ecosystem here.

Ali: Yeah, but these are really great questions, so we appreciate you, guys, being engaged here and asking these 'cause we're happy to help answer them.

Dave: Yeah, do you have to have LPR to offer this type of segmentation? So for non-members, yes, that is how we track non-members is through LPR. So every time a license plate comes through, we capture that customer data, what discounts they accepted or rejected, how much they've spent with the wash, what products they're purchasing, how long they've been a member, or a lot of different information around that segmentation. But for non-members, it is driven off of LPR. Are there any concerns about the number of promotions I can run on my XPT and what is the best practice? So best practice is to provide, I think, four or five very targeted ones. You don't want your onsite staff to get confused about the things that they're seeing and not know how to handle them. I think as time goes on, you'll be able to get more and more sophisticated with how many promotions you can run on your XPT. But as far as how many promotions, we've scale test this regularly. So being able to look up what segment a customer sits on and delivering that promotion, there's not a lot of concern. I mean, we test up to like two to 300 promotions being stored against a single site location. So you can really get very advanced with how you offer your promotions to your customers. And I think we've hit all the question and answer sessions. So really appreciate everyone's time in joining the webinar and we'll see you on the next session.

- Thanks, everybody.

Translucent arrow decoration

See Catalyst In Action!

Complete the Form Below to Request a Free Demo

or

Request more information