MASTERCARD ADVISORS INFORMATION SERVICES | …3 Agenda •Evolution of the Customer Relationship...

MASTERCARD ADVISORS INFORMATION SERVICES | MERCHANT

Big Data Insights to Better Connect with your Customers May 2013 ANDY MANTIS GROUP HEAD | SVP, MERCHANT SOLUTIONS

2 ©2013 MasterCard - No reproduction or sharing without express written consent of MasterCard

Disclaimer

© 2013 MasterCard International Incorporated. All rights reserved. The information contained herein is the confidential information of MasterCard. This presentation may not be redistributed or reproduced, in whole or in part, without the prior written consent of MasterCard. This presentation contains information acquired from the MasterCard Data Warehouse which is comprised of transaction information provided by third parties (i.e. acquirers, and/or merchants) and hence may contain certain errors, omissions or inaccuracies from time to time. The presentation and the data herein is provided for illustrative purposes only; MasterCard shall have no responsibility for any inaccuracies, errors or omissions in any data, analyses or information provided herein which has been based upon data in the Data Warehouse or data otherwise provided by or on behalf of any third party.

Information Services for Merchants


Agenda

•Evolution of the Customer Relationship •Need for Behavioral Understanding •A New Approach •Micro to Macro Insights •Behavioral Data in Action •Myths of Big Data •MasterCard Advisors Differentiation


Big Data in Sports

Big Data for Athletes Big Data gives athletes extra edge at high-tech London Olympics – CareerMash

Big Data for Teams: New Baseball Tech Makes 'Moneyball' Look Like Little League – Business Insider Big Data for Fans: NBA Gives Basketball Nerds the Gift of Big Data- Mashable

…and now Big Data for Retailers


Insight for Merchants

Knowledge of aggregated consumer segment spend both inside and outside of your locations delivers valuable insight for acquisition, loyalty and retention and strategic decisions.

MasterCard delivers this unprecedented 360-degree view to help you:

Understand your market

Benchmark your performance

Grow your customer base


Evolution of the Customer Relationship

Interpersonal: 1 to 1

6



Purchase Tracking

7



Demographic Analysis

8



Impersonal Relationships

9



Impersonal Relationships

10


Need for Behavioral Understanding



Unique behaviors?



Unique behaviors?

Brand affinity?



Unique behaviors?

Brand affinity? Time of day?



Unique behaviors?


Distance of travel?



Unique behaviors?


Distance of travel? Competitive spend?


A New Approach

Macro Micro


Macro Insights Drive Micro Trends

Sporting Goods sales has

outperformed the broader U.S.

economy 0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13

Sporting Goods Y/Y Sales Growth U.S. Retail Y/Y Sales Growth excl. Auto and Gas


Micro Insights Drive Macro Trends Ill

ustr

ativ

e

National 12%

State 8%

Local 15%

Macro trends can drive relative merchant performance Merchant Market Share


National to Local Store Market Performance National

State

Location


Competitors

32.5%

RANK #1 02903

02917

Merchant

22.7%

RANK #5

02920

02904

Develop Focused Marketing Efforts That Reach The Right Customers

• Identify areas where you

draw customers as well as

opportunities to attract new

customers.

• Market to these target

segments and measure results

over time.

02906


Behavioral Data in Action

A retailer with an existing loyalty program wanted to identify opportunities for growth.

Primary Objectives: • Increasing customer spend • Gaining market share from competitors


Behavioral Data in Action

MasterCard Account Spending In Industry

Total Industry

MACRO

Retailer Account Spending

MICRO

Methodology • Establish which customers have the largest

headroom opportunity • Evaluate the opportunity of Top Customers

and Acquisition Target Customers • Act on Acquisition Target Customers to drive

results


Loyalty Segmentation

$$$$

$$

$

High Medium Low Not Bought

Total Customer Spend in Industry Total Customer Loyalty

to Merchant

Total Customer Spend in Industry

Total Customer Loyalty to Merchant

Methodology



$$$$

$$

$




Non Top Customers

Top Customers

Identifying Segments



$$$$

$$

$




Top Customers

Quantifying Opportunity

Acquisition Target Customers

Annual Spend At Merchant:

$91 Annual Spend at Competitive Set:

$722

Annual Spend At Merchant:

$527 Annual Spend at Competitive Set:

$381 Illus

trat

ive


Behavioral Segmentation

Acquisition Target Customer:

Active Lifestyles



General Demographics

Age: 40+ Income: $75K+



Brand Affinities

Apparel Home Appliances



Related Category Spend

Tennis



Unrelated Category Spend

Entertainment



Channel Preferences

Propensity to buy online



360° Customer View



Top Customer: Everyday Spenders



General Demographics

Age: 40+ Income: 75K+



Brand Affinities

Hockey Equipment



Related Category Spend

Electronics



Unrelated Category Spend

Fuel



Channel Preferences

Growing propensity to buy online



360° Customer View


Acquisition & Engagement

58% (Your Spend) 58%

(Your Spend) 42% (Competitor)

Growth Opportunity

We believe that this provides a new benchmarking metric to allow for a more detailed view of growth, relative to market

Targeted Campaign


Acquisition & Engagement

58% (Your Spend) 58%

(Your Spend) 42% (Competitor)

KNOW ACT MEASURE


Myths of Big Data

Myth 1: Raw data is enough.

Myth 2: All sources are created equal.

Myth 3: Big data breeds Big Brother.


Why MasterCard is Uniquely Qualified

• 1.9 billion global cards.

• 160 million transactions/hour.

• Knowledge of aggregated, holistic consumer spend delivers key insights for acquisition, loyalty and retention.

• MasterCard delivers this unprecedented 360-degree view, from macro economic to micro segmented, spanning a full range of industries.

Driving business advantage through insight and foresight and engagement


NSGA Show Special

Market Vision Reports FREE TRIAL

You are eligible to receive a free trial of three MVR reports (delivered monthly) per location – up to 500 locations. Contact MasterCard Advisors now.

For your free trial, email us at [email protected]

MASTERCARD ADVISORS INFORMATION SERVICES | …3 Agenda •Evolution of the Customer Relationship...

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