Costa used our decision intelligence platform to segment customers, tailor and target communications, and make more intelligent range decisions.
Costa started as a small roastery in London, headed up by two brothers of the same name. Just over 50 years later, the brand has over 4,000 coffee shops worldwide and is regularly voted the UK’s favourite.
Costa is embracing decision intelligence and using a combination of data science and AI to increase loyalty and improve consumer value and reward.
Costa sought help in three areas:
- Refining its customer loyalty programme to drive customer lifetime value.
- Providing more intelligence to deliver a better ranging solution, based on customer behaviour, preferences and missions.
- Forecasting transactions and sales from its loyalty base more accurately.
We used decision intelligence to help Costa with:
Costa has been on a journey to make its loyalty scheme ‘Costa Club’ more personalised. The coffee chain is aiming to improve customer experiences and engagement, and to drive greater customer lifetime value.
Our team developed a dynamic customer loyalty model, then used our decision intelligence platform to deliver interactive loyalty segments based on a customer’s interactions with Costa over a 12-month period. For example, weekday commuters with five small coffee missions each week, versus weekend trippers with multi-person and multi-item food and drink social occasions.
We’re currently supporting Costa to more accurately predict how successfully they’d be able to move customers up the recency, frequency and value ladder.
Optimising Costa’s ranges.
Costa wanted to look at new ways of understanding stores, with a view to segmenting its coffee shops to make more intelligent operational decisions. They wanted to identify stores meeting specific food missions – for example, breakfast on the go for commuters, versus ‘sweet treat’ social occasions.
Our team started by developing 100+ attributes against products, stores and customers to identify product substitutability, customer missions and loyalty. For example:
- Products described by customers as ‘indulgent’ eg frappes, cakes, foods containing cream.
- ‘Value’ products versus ‘premium’ products.
- Nutritional elements (eg gluten free, vegan).
Then, using a combination of store clustering and our decision intelligence platform, our team created data-led, customer-centric recommendations to support more intelligent decision making.
Decision intelligence helped Costa with:
Costa Club is one of the UK’s largest loyalty schemes and continues to grow across all loyalty segments. HyperFinity has played a key role in helping Costa develop a more sophisticated understanding of its loyalty base and how the business continues to measure and optimise.
Costa has access to our decision intelligence platform to build on the segmentations we built – for example, to create further ‘micro’ segments for targeted and personalised marketing.
Optimising Costa’s ranges.
Through a mix of consultancy and our decision intelligence technology, we categorised stores using product attributes and customer behaviour to identify strategic opportunities.
The project laid the foundations for customer personalisation to deliver more relevant offers and marketing to Costa’s customers, as well as optimising in-store ranges. Every store is different, and these new tools are helping Costa understand how to meet consumer needs every day.
We’re continuing to support Costa to leverage decision intelligence. This includes:
- Creating micro customer segments to build highly personal relationships with consumers.
- Developing granular consumer centric forecasts to support trade planning.
This capability will help Costa tailor offers and products to meet the needs of consumers across different formats, occasions, and engagements with their brand.