A large regional discount retailer was faced with a challenge, they needed to grow the profit margin generated by each store without adding square footage or opening additional locations. Since they are a discount retailer it was difficult to lower prices to increase sales, conversely raising prices across the board would reduce their competitiveness in the market space. Ideally, more stores or physical expansion of current stores would have solved the problem but the funding wasn’t available. 

In addition, they were looking to build an accurate customer database which was something that they were unable to do due to the current limitation of their point-of-purchase system. They were tied to an antiquated IT system that wasn’t scheduled for replacement for a few years. They wanted to get a jump start on building a customer database and leveraging it to build customer loyalty and increase the average cart value per visit. In order to do this, they would need to create a system where they could see who their customers were and understand the product categories that they were interested in. They realized that targeting was key to growing profits and sales but needed a system to be able to capture the data.

Sunny Direct was tasked with building a marketing campaign and a simple system for capturing customer data and delivering it to the client. With the known limitations within their POS system we decided to start with simple system that would be easy for their in-store team members to manage. The idea was to create a direct mail program with promotional cards inside. These cards had barcodes that were matched to the address on the mailer. Since they could not scan these barcodes at the register we build a system where the cards were collected at the store level and sent back to us using preconfigured shipping cartons. While this may seem fairly rudimentary it was very quick and easy to implement across hundreds of locations and did not create any additional costs. Once the cards arrived back at our facility they were scanned in and uploaded to a database to track the response rate, ROI, and customer information. This was the beginning of their customer database. We were now able to capture information about who their customers were and the types of offers that they were interested in, all this was data that was unable to be captured by their current IT infrastructure. Once we gathered this data we analyzed customer trends and began highlighting higher margin items that were of interest to the

The new program resulted in a win-win situation for both the store and their customers. They saw increased foot traffic and cart value due to more relevant and personalized offers being delivered to their customers. They were also able generate significant additional revenue per store which alleviated the pressure to increase the square footage of individual locations. A clean and accurate customer database was created which was used to better understand who their customers are. This database was leveraged for subsequent campaigns and also used as a template for new acquisition programs. The solution was simple, effective, and scalable across all of their current locations. It provided a sustainable, long term strategy for growth that did not place unnecessary stress on their marketing budget.