Morrisons has recently teamed up with Telefónica Dynamic Insights, the data arm of the O2 mobile network, to target consumers who shop at other grocers.

Morrisons has recently teamed up with Telefónica Dynamic Insights, the data arm of the O2 mobile network, to target consumers who shop at other grocers. In itself, this kind of competitor rivalry is nothing new, but in this case Morrisons has upped the ante by using mobile phone location data to tempt new shoppers into its stores.

The basic premise is that shoppers’ mobile phone signals are used to give Morrisons an idea of how many people from different postcodes are visiting its stores compared to its competitors. This way, coupons can be sent out to those areas that have fewer shoppers coming to Morrisons. So did it work? You bet it did: Morrisons increased the number of new shoppers it generated by 150 per cent compared with its traditional customer acquisition methods.

Although stories like these are bound to make some consumers feel uneasy, this is just another example of the growing convergence between telecoms and retail. The truth is that this ‘Big Brother’ approach to gathering customer data will probably end up being commonplace in just six months time.

Today’s retailers need to be aware of developments like these, as this kind of technology offers a powerful way of getting closer to customers and understanding their behaviours. And, even though early adopters could risk a PR backlash by tracking their customers in this way, this is likely to fade as more and more retailers start using mobile technology to target potential new customers.

Many retailers still seem to think that getting customers to make a purchase with their phone is the main goal of mobile commerce, but that’s really only part of the story. Mobile technology also gives retailers an interactive way of engaging with their customers and initiating conversations with them, which not only enhances customer satisfaction, but also loyalty.

And then, of course, there is all the customer data that can be collected. Retailers cannot afford to miss out on the incredible value that this kind of information can provide, not only for monitoring promotions and creating more targeted advertising, but also to drive business growth through better decision-making.

Retailers need to remember, however, that this kind of data is only as good as the company’s ability to interpret it. The latest technology surrounding mobile data analytics is incredibly smart and sophisticated and can therefore be an extraordinary tool for understanding customer behaviour- but only if it can be transformed into usable business intelligence.

After all, understanding what customers are doing and where they are going is only the first step. Ultimately, it’s what retailers do with that information to improve their offering, streamline their operations and build a better rapport with customers that counts.

  • Dan Coen, director, Zolfo Cooper

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