Article
Data insight key ingredient to Hershey’s sweet retail experience success
Information, and analyzing data, is a prime reason why Hershey is succeeding in a very competitive retail industry.
February 23, 2016 by Judy Mottl — Editor, RetailCustomerExperience.com & DigitalSignageToday.com
If cocoa is the critical element to Hershey Company's product success, then knowledge is the essential ingredient to its retail customer experience strategy.
Knowledge, specifically data and customer insight, are a critical part of the business driving retail strategy, providing nimbleness, innovation and creating strong customer relationships.
"With insights and knowledge you win by being the smartest and being better at meeting customer needs," said Michele Buck, president North America, Hershey, during a panel presentation at the recent National Retail Federation Big Show held in New York City.
The largest producer of chocolate, with over $7.4 billion in net sales, it's clear Hershey's customer experience approach is working and Buck said a key factor is the legacy company's ability to move and move fast when needed.
"Hershey is on a brilliant journey and advance insight and knowledge is so critical to survive, you need to anticipate change and get ahead and adapt. There is a retail revolution going on and we need to drive it," she said. "With insights and knowledge you win by being the smartest, better at meeting customer needs," she added.
A major strategy prong for Hershey has been partnering with SAP for its data knowledge and analytics effort. SAP Global Consumer Industries General Manager Lori Mitchell-Keller explained that retail success is all about focusing on the individual.
"It's in our DNA to think about the consumer and how they go about their business. The goal is to use data to touch people in a memorable way," she told the key note panel audience, which numbered over a thousand attendees. "Data is accelerating at a pace it's hard to keep up. There are two big trends: a transformation of how retail is reviewed over the next few years and using data to gain micro insight," she said, adding, "We’re in a digital economy now."
Mitchell-Keller said the top obstacles to optimizing on Big Data include not get required leadership support at the outset and having to work with legacy and unstable tech systems.
"All these need to stop being obstacles. There now needs to be a digital core, a soul of digital business," she said, adding a flexible, adaptable infrastructure for analytics is key for optimizing data intelligence.
In building customer relationships, Hershey has focused on meeting consumer expectations of doing business with a company that is doing well in terms of community involvement. Buck said today's consumers are making shopping and purchasing decisions based on how they view a company and what the company represents.
"People care about what a company is doing for community so Hershey is doing well by doing good," she said. "It's all about looking to better meeting their needs. We have 81 million consumers, foodies, and the relationship with food is changing," she said, adding corporate transparency is also critical as consumer expect openness.
Hershey has also been closely tracking how consumers are eating today, and when and what. Buck notes 60 percent of consumers view a meal as a snack.
"We needed to address that by offering higher protein snacks," she said. Another customer trend is the increasing activity of online food purchases.
"Right now that number if about one quarter of consumers. This year it will likely be half of all consumers,” she explained.
Another key element to Hershey’s customer experience strategy is the philosophy of pilots, trials and testing and not being tentative in exploring new products and retail location strategies.
"We're testing everything possible to figure out how to win this challenge," Buck said, noting Hershey was the first food packager to connect with Amazon’s Fire TV as a sales channel. "Everyday something new is possible that wasn’t possible prior," she said.
In the physical retail environment Hershey is committed to working with retailers on deploying and developing more compelling customer experiences and is very focused on "reimaging" the confection aisle of partners. Hershey is committing resources, services and technology with its retail partners.
"Shopping should be fun, and provide a store within a store environment," Buck said, noting such an approach has driven double digit sales growth. "There are new ways of doing business that we need to embrace," she said, alluding to the increasing mobile payment and checkout options coming into play in the retail segment.
Part of Hershey's data strategy, which is propelling a 20 percent increase in business, now involves using facial recognition technology to capture real time consumer feedback in the confection aisle and capitalizing on social media channels.
"We have seen great success with even a light deployment of a Pinterest solution in stores,” Buck noted, adding Hershey is currently focusing on 3D printing technology to create 3D chocolate products and is already piloting such product development at its Chocolate World retail location.
"It's still early in our journey but we take insight and knowledge very seriously," Buck said. "Consumers still want that tactile experience and it's time to make it fun. So we're leveraging data to make every inch of store product and offering custom offers."
About Judy Mottl
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