The shopper-analyzing joint venture of a British company and the Kroger Co. grocery chain has expanded into new retail arenas, while being replicated in other countries around the globe.
Since beginning in Cincinnati six years ago, dunnhumbyUSA has gone beyond gathering and mining Kroger loyalty card and survey information to provide consulting for retail clients including The Home Depot Corp. home improvement chain, Macy's Inc. department stores, electronics retailer Best Buy Inc., Panera Bread cafes, and car parts chain AutoZone Inc. It also provides information for some 150 consumer products clients, including Procter & Gamble Co. and Campbell Soup Co.
The venture is credited with helping Kroger weather the recession better than other grocers, with a focus on building the number of regular Kroger shoppers and drawing those households more often with rewards such as special coupons for items they buy frequently.
"There are so many white papers and academic papers out there that say it costs seven times more to bring in a new customer than it does to retain an existing customer," said Stuart Aitken, CEO of the Cincinnati-based operation that has more than 420 employees and has tripled revenue in five years to some $275 million.
"I liken it to a bucket. Let's pretend you have a bucket of customers. Many companies are focused on finding another faucet to fill that bucket, while Kroger focuses on plugging the hole in that bucket."
Aitken said a similar approach is being applied with the new retail customers, although he declined to discuss details.-
Meanwhile, London-based Dunnhumby has launched similar joint ventures with retailers in 18 markets globally including Metro in Canada and Gruppo Pam in Italy. Co-founder Clive Humby told Kroger investors at a conference last month that it expects to keep growing behind its statistical insights into consumer behavior and focus on "the retailer learning to be loyal to its customers."