I shop at my neighborhood Kroger the same day every week.
In fact, the same time the same day every week. And I buy pretty much the same items the same time the same day every week.
When I check out, they scan my Kroger loyalty card and swipe my American Express card. And now and then, along with my sales receipt, I get a coupon suggesting an alternate brand of cereal or olive oil. That has made me realize they know a little bit about me.
What I'm now beginning to realize is that they could know a whole lot about me!
An article in The New York Times said that Wal-Mart, by its own count, has 460 terabytes of data stored at its Bentonville headquarters. How much is 460 terabytes? To put that in perspective, said The Times, the entire Internet has less than half as much data.
As The Times pointed out, Wal-Mart – with 3600 stores in the United States and roughly 100 million customers walking through its doors each week – has access to information about a broad slice of America. The data are gathered item by item at the checkout aisle, then recorded, mapped and updated by store, by state, by region.
This is the future. Sophisticated technology that measures and systematizes everything + increasing use of credit cards and loyalty cards + the competitive edge that can be gained by even a small amount of customer insight = power in retailers' hands. Wal-Mart insists is gathering all that data to streamline its operations. With the tremendous storehouse of data, it can better predict its inventory needs.
That means shoppers will not encounter frustrating merchandise shortages, even in peak demand times. For example, noted The Times, as Hurricane Frances began to barrel across the Caribbean last September, Wal-Mart computers said its Florida stores had better stock up on certain products – not just flashlights and candles but also (get this) Pop-Tarts and beer. Retailers can also use the data to anticipate times when they need more store personnel on the floor; or more checkout stations manned and operating; or more couponing; or more promotional materials; or more p-o-p support. And that only makes everyone's shopping experience more positive.
“The potential is huge,” says Ken Pray, Kroger's coordinator of store design. “We'll be able to target advertising and promotion as never before.” Most retailers' advertising is mass – newspapers, circulars, even in-store promotions. But with specific data on shoppers' habits and preferences, retailers could zero in on shoppers where they spend most of their time these days – on the Internet, with well-placed, well-timed e-mails.
One day, Kroger will e-mail me that my daughter's birthday is coming up. Have I bought a card? Flowers? A cake?