Business challenge

Caffè Nero needed to provide more personalised, timely communications, increase awareness of seasonal promotions and turn online communications into increased loyalty and physical customer spend.

Transformation

Caffè Nero identified that its customers viewed visits to its stores as more of an experience than simply an amenity-based function.

Results

68% customers

receiving personalised emails buy a coffee within a week

70% email open rates

amongst registered card holders

Loyalty card holders

visit and spend twice as much as ad hoc customers

Business challenge story

Framing the Challenge

Each year Caffè Nero runs four quarterly campaigns revolving around two seasonal promotions (Christmas and summer), and two specific coffee-focused campaigns—as well as a number of smaller product launches. The challenge for the coffee house was to make its customers more aware of these by providing personal, omni-channel engagement that would result in greater customer participation and increased revenue.

Whilst Caffè Nero had started to grow a large database of customers, it recognised that it needed to be “smarter” in order to mobilise its existing customer base.
 

IBM Watson Campaign Automation has enabled us to build segmented buyer personas and achieve 70 percent open rates among our loyalty card holders.

—James Flett, Partnerships Manager, Caffè Nero

Transformation story

Moving the Dial

Caffè Nero identified that its customers viewed visits to its stores as more of an experience than simply an amenity-based function. As such, it identified pre-paid card holders (existing and future), as a core focus for its marketing communications push.

To turn its new customers and card holders into brand advocates, it used IBM Watson Campaign Automation to deploy a three-point personalised communications strategy, based on persona segmenting and behavioural mapping, which at every touch point provided Caffè Nero with more and more valuable data. In turn, this data enabled it to take an increasingly segmented and laser-focused approach to its future customer communications, including the following:

“Benvenuto in famiglia Caffè Nero”: As soon as a Caffè Nero customer signs up to the database and pre-paid card initiative, a welcome email is delivered to start the engagement process. In addition to informing the customer about offers and opportunities, these initial emails gather personal information such as frequency of use and preferences—pivotal to building on the persona mapping process.

Monthly Statements: These automated messages allow Caffè Nero to engage with its registered customers on a regular basis, providing personalised information on existing card balances, but also informing customers of seasonal updates and new releases.

Friendly Top-Up Reminder: There are few things more frustrating than finding your balance is flat on a gift/loyalty/Oyster card. Using IBM Watson Campaign Automation, Caffè Nero now sends triggered, real-time email reminders when its customers’ cards are lower than £2, so they are less likely to run out of credit or miss that mid-morning coffee hit.
 

In 2014 global consumers spent over $85 billion on coffee, and the competition for customers is becoming increasingly fierce, with multinationals and independents all vying to engage customers, grow their loyalty base and increase revenue.

—James Flett, Partnerships Manager, Caffè Nero

Results story

Coffee Drinkers Turned Brand Advocates

By implementing these nurture programs, Caffè Nero has seen card holders visit and spend twice as much as a lookalike control group. The company has tallied a 70 percent email open rate among registered card holders, significantly driving offline purchases. Its results show that 68 percent of customers receiving personalised, relevant emails buy a coffee within the week.

“We have been working with IBM Watson Campaign Automation for 18 months now and in that time have significantly grown our eCRM activity and capability” says James Flett, partnerships manager, Caffè Nero. “Thanks to the ability to segment our customers and deliver relevant, bespoke and realtime value in our marketing communications, we’ve seen impressive results.

"These email open rates are showing a high level of engagement amongst this group, and we’re genuinely starting to see communications translating into physical visits, which was one of our primary objectives.

"We are looking for best practices to take customer loyalty into the digital age, and IBM Watson Campaign Automation will continue to be instrumental in enabling us to take full advantage of our continually evolving digital landscape.”

About Caffè Nero

Caffè Nero is a European coffee house brand specialising in the creation of hand-crafted artisan coffee in towns and cities across Europe, the Middle East and most recently North America. Its philosophy is really very simple: premium Italian coffee, a warm welcoming atmosphere, good food and great personal service.

After being founded in 1997, Caffè Nero now has 600 UK stores and 100 internationally. Its aim is to create a continental coffee house atmosphere in an accessible, friendly place to meet up that has something of a “buzz” about it—a familiar neighbourhood gathering point, whichever country or location customers find themselves in.
 

Solution components

  • Watson Campaign Automation (All Editions)

Take the next step

IBM Watson Campaign Automation powers the delivery of exceptional experiences for customers across the buyer journey by leveraging customer data and behaviors, providing analytical insights and automating relevant cross-channel interactions. The cloud-based digital marketing platform provides email marketing, lead management and mobile engagement functionality to inform and drive personalized interactions in real time.

To learn more about IBM Watson Campaign Automation, please contact your IBM representative or IBM Business Partner, or visit the following website: ibm.com/watson/marketing-automation.

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