More than a century ago the young Japanese entrepreneur Konosuke Matsushita set up his first workshop producing light sockets and other small electrical goods. His company grew to become what is known today as Panasonic Corporation, one of the world’s largest electronics manufacturers. Its vast product range includes consumer and professional electronics, household appliances and […]
How Panasonic enhances brand loyalty with Mindbox05 Apr. ‘19
More than a century ago the young Japanese entrepreneur Konosuke Matsushita set up his first workshop producing light sockets and other small electrical goods. His company grew to become what is known today as Panasonic Corporation, one of the world’s largest electronics manufacturers. Its vast product range includes consumer and professional electronics, household appliances and heavy-duty industrial solutions. As of 2018, Panasonic is placed at 231 in the Forbes Global 2000 list of major public companies. Panasonic’s Russian presence is handled by its subsidiary company Panasonic Russia Ltd.
Panasonic began dealing directly with its Russian customers in 2001. It started retailing online in 2002, at first selling accessories before going on to sell household electronics and appliances. In 2014 Panasonic transferred its high-street sales to retail partners and focused on developing its direct online sales.
Panasonic’s online presence now includes its official online store and the Panasonic club for brand afficionados. Specialised product landing pages, social networks and mini-sites for competitions are also used to attract new customers.
Panasonic’s online marketing strategy has always been heavily influenced by the traditional family-owned Japanese appliance stores, some of which still operate today. The owners knew every one of their customers and remembered their personal preferences. Recreating this retail format in the modern Russian high street would be problematic. But recreating it online is entirely feasible, using personalised communication to create the impression that Panasonic is your friendly local storekeeper.
Loyalty programme manager
In traditional Japanese stores, the shopkeepers know what appliances their customers have at home and make sure to order in new arrivals that will be of interest to them. They keep track of when their customers need to replace vacuum cleaner bags, air conditioner filters and even light bulbs. These shopkeepers are highly tuned to their customers’ wants and needs, and to a certain extent even anticipate them before they arise. These are the kind of local neighbourly stores where you might just drop in for a chat on your way home from work. That’s the exact kind of atmosphere we wanted to create online with our personalisation strategy for the Russian market. We strive to understand what our customers needs and wants are. If we can’t find out exactly what that is, we try hard to make a best guess.
To achieve this we needed a CRM system that can store data and create segments for hundreds of thousands of customers and enable us to run a loyalty programme with direct communications. That’s how we came to work with Mindbox.
What we achieved together
Panasonic uses two key indicators to measure marketing effectiveness.
KPI #1 is the percentage of new customers that make their first order after registering on the official Panasonic website, in the Panasonic club or on a promotional landing.
KPI #2 is the ratio of registered vs. unregistered visitors interacting in some way with Panasonic’s online resources. This indicator shows the level of interest in the Panasonic brand and its activities.
What we’ve achieved so far:
- Created a unified customer database for generating personalised offers.
- Helped build a loyalty programme with three member tiers and a variety of points mechanisms.
- Set up unified registration for users of all Panasonic’s online resources.
- Helped set up a system to provide each customer with an individual price for every product.
- Helped organise a joint loyalty programme with a major national bank and the JCB payment system with special conditions for Panasonic customers.
Here’s how Panasonic uses Mindbox to personalise its marketing.
Store all customer activity in a unified database
In 2013 Panasonic’s customer data was spread across seven completely independent databases covering: online retail, high-street retail, Cooking Club, Lumix club and other channels.
It was impossible even to get an accurate count of unique customers across all these databases, and compiling an overall picture of individual customers’ purchase history and behaviour was out of the question. There was no way the data could be used for any kind of personalised marketing.
The Mindbox system is based around our CDP (Customer Data Platform). We used the CDP to compile the separate customer databases into one, merging behaviour, purchasing and personal data. This gave us a clean database containing all available information about each and every customer.
Head of digital marketing
«Mindbox enabled us to create a unified database without duplicate entries and with no invalid or non-existent addresses. Together we ran a number of tests to see who did and did not respond to emails, and got our database into shape.»
Panasonic uses Mindbox to get to know its customers better. We connected all their online assets to Mindbox – the online store, club websites and promotional landing pages – so that all data would be passed to the unified customer profile in real time.
The result was a stark difference in customer profile completeness when compared to 2014:
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Information in the unified customer profile allows marketers to segment their audience according to preferences and behavious. Segmentation is needed in order to send automated mailings only to customers who will be interested in them, and at the right time.
Panasonic has dozens of specific automated campaigns, including abandoned views, abandoned carts, points expiry reminders, newsletters and other triggered feeds.
They have a variant on the «abandoned cart» theme that uses points. Customers receive temporary additional loyalty points for their uncompleted order.
Previously they had standard triggered emails to remind customers to complete their orders. Customers were following the abandoned cart links but still not completing their orders, so the marketing team decided to change things around.
If an abandoned order is not completed with in a certain time, the customer receives temporary points that can be used for an additional discount on that order.
The idea worked and the customer completed the order.
Altogether between 25 and 30 triggers are running simultaneously. Triggers use segmentation data such as age, date of birth, gender and location.
For example, a reactivation email looks different for male and female recipients.
Panasonic also segments its mass mailings. Wishlists, for instance, are a valuable source of targeting information. If someone adds a kitchen appliance to their wishlist, they will receive discounts and offers on kitchen appliances. Someone with a camera in their wishlist will receive an email with photography promotions.
Here’s an example where a customer added a charger for a very specific type of batteries to her wishlist.
This action results in her inclusion in a battery discount promotion. She receives an email with an offer to use either a discount code or to use loyalty points to pay for up to 50% of her purchase.
The customer followed the link in the email and added batteries to her cart.
And completed her purchase.
Loyalty programme manager
«After creating a unified profile for all our customers, we set to work together with Mindbox on improving our database and increasing its business value. We know that personalised email communications are a powerful marketing tool.»
Individual prices for loyalty programme members
Up until 2012 Panasonic had a major advantage of brand recognition over other online retailers. People were wary of buying from unkown stores for fear of receiving counterfeit goods, and tended to prefer purchasing direct from manufacturers’ branded outlets. Gradually, however, trust in independent online retailers began to grow. Panasonic responded to this change in market conditions by introducing a loyalty programme.
Since then their loyalty programme has gone through a number of iterations to become what it is today, with individual prices for every customer. If there are no special conditions or promotions, individual discounts can be up to 50% depending on how many points the customer has accumulated.
The exact discount is calculated in Mindbox according to a formula specified by Panasonic.
Any customer that is logged in and does not have a corporate account sees two prices for every item in the catalogue:
- Discounted personal price for purchasing with loyalty points
- Full retail price.
Customers can easily see how many points they will be awarded with the purchase of any item. Individual prices for each product are based on how many points the customer has accumulated, their loyalty programme status and on the number of points that will be awarded for the purchase of that product. All of this information is sourced from Mindbox.
Set up unified registration for users of all Panasonic’s online resources
Panasonic runs short- and long-term campaigns on various online assets. Visitors arrive at different sites and landing pages from a wide variety of advertisements. Previously this led to confusion, as users created separate accounts on each site, or registered on some sites but not on others. Consolidating their information was a complex undertaking.
Panasonic decided to simplify matters with a single sign-on for all online assets. In other words, users would have just one username and password for all Panasonic’s online resources.
Mindbox set up a single sign-on hub for Panasonic’s user club, online store, promotional landing pages and competition mini-sites.
Single sign-on is an industry standard for corporate web resources. A customer who is registered on one site can freely roam between other sites without having to create new user accounts. Mindbox is the central database for collecting customer data. We take care of registration and authorisation, password recovery and deduplication of user data across all Panasonic’s sites.
Customer activity across all online assets is collected in the unified customer profile The online store provides data about product views, purchases and engagement in promotions, while the club website provides information about interests, preferences and brand engagement.
Added more methods of earning points
Every loyalty programme member can receive a discount of up to 50% depending on how many points they have. However, accumulating points from purchases alone is a slow process. Panasonic came up with a scheme that would encourage greater brand engagement and enable active customers to accrue more points more quickly and deployed it on the Mindbox platform.
First method – tell us about yourself
Every customer receives an automated welcome email when they register a user account. In this email, Panasonic invites them to earn points by providing information about themselves and their preferences.
All profile information is passed to Mindbox and is used in creating new marketing hypotheses and for planning triggered mailings, for example interest-based news digests and birthday greetings.
Second method – make purchases
The number of points awarded for a purchase depend on the customer’s status in the loyalty programme at the time the purchase is made.
The online store passes information to Mindbox where purchase volumes are calculated and customers are transitioned between segments.
Customers receive an email when their loyalty programme status changes.
For some promotional items, a fixed number of points (up to 30%) may be awarded regardless of the customer’s loyalty programme status. This means that customers in the 5% tier who spend all their welcome points on their first purchase can potentially get a 30% discount on their second purchase.
Third method – online brand engagement
In 2018 Panasonic ran a major competition to mark its 100-year anniversary. First prize was a trip to Japan. Certificates for 5,000 and 10,000 bonus points were used as additional prizes at all stages of the competition. In December Panasonic reminded its subscribers about the anniversary and offered extra points for sharing a post in social networks. This resulted in 3,000 reposts in three days.
Individual conditions are configured for every promotion in Mindbox, including how often, for what actions and with what frequency to reward a single user.
Another way to earn points is by writing a review on the official Panasonic website. This will net the customer 500 points. Prior to introducing this scheme customers wrote from 5 to 10 reviews per month. Now they write 5 to 10 reviews per day.
Fourth method – pay with an RAB card
Customers can receive extra points by paying for their purchases with a Russian Agricultural Bank card. RAB cards work on the Japanese JCB payment system.
When a customer pays for any purchase (e.g. in supermarkets, cafes, filling stations) with an RAB card, they get 5% cashback on their Club Panasonic account. Customers can accumulate loyalty points to redeem against purchases of Panasonic products simply by using their bank card every day. RAB cardholders receive an additional 20% for purchases from the official Panasonic online store. This 20% combines with the standard loyalty programme rewards (5, 10 and 15% depending on member tier). Premium members can thus receive up to 35% in bonus points. After making one large purchase, they can easily make several more purchases with the maximum available discount.
In addition, customers benefit from a wide range of privileges afforded by the JCB payment system worldwide. JCB created a «Welcome to Japan» programme for tourists, with discounts on public transport, restaurants and tickets to major tourist attractions all over the country. Card holders also benefit from special discounts and privileges in other popular holiday destinations, including Thailand, Vietnam and South Korea. In Russia there is a «Made in Japan» programme for JCB customers that provides discounts in participating Japanese restaurants and retail outlets.
The partnership between Panasonic and JCB provides significant exposure for both companies. Being new on the Russian market, JCB approached Panasonic with its partnership proposal. Aligning itself with a well-established Japanese brand in the Russian market was a good opportunity for JCB to achieve recognition in the crowded payment systems sector.
Awarding loyalty points to RAB customers required that we integrate Mindbox with the bank’s systems. The bank passes information on a daily basis about how many points to award to whom. RAB customers can earn points from their bank before they ever register in the Panasonic system, so Mindbox creates temporary accounts for them. When one of those RAB customers registers in the Panasonic system, points are transferred from their temporary account to their loyalty programme account.
Loyalty programme manager
RAB began issuing its co-branded Panasonic 100-year anniversary JCB card in July 2018. By the end of 2018 around 1000 card holders had registered in our system. There are another 6000 cards in use, so we’re waiting for them to register with us. To date, registered card holders have made purchases totalling $60 000. The whole co-branding endeavour is mostly a PR project for us, with an added opportunity for enthusiasts to further engage with our brand. We never expected it to generate any significant additional revenue, so we see this as a pleasant bonus.
Over the lifetime of the loyalty programme, 48% of Panasonic customers have used loyalty points when making purchases.
In personalising their communications, Panasonic pursued a goal of creating friendly, neighbourly relations with their customers. Together with Mindbox, Panasonic achieved this goal by:
- Creating a single customer database to know their customers better and to better personalise communications.
- Setting up a loyalty programme with individual prices for every member, and a variety of ways in which to earn points.
Thanks to these efforts, the number of people making their first order after registering on a Panasonic website grew from 1% in 2014 to 25% in 2018. The percentage of visitors engaging with Panasonic’s online assets also grew, from 21% in 2015 to 38% in 2018.
In 2019 Panasonic plans to focus on analysing the effectiveness and profitability of various user registration sources in order to have a better understanding of how different channels work, such as social networks and context advertisements.
In addition they plan to increase the level of personalisation by:
- Integrating their customer database with their call centre so that customer information will be available to operators, for example what appliances the customer already owns.
- Enhancing triggered email campaigns using information about product price categories and regional demographics.
- Adding website push notifications to gather further information about customers.
Other plans include stepping up marketing and advertising activities, creating a dynamic site that builds itself for each customer with a selection of relevant items, and creating modules for each advertising campaign.
Loyalty programme manager
«We now have automated routines in place that would have been impossible before we moved to Mindbox. We usually roll out new procedures in two stages. Once the task has been formulated we go through a difficult phase, sometimes with manual operations. Then it gets more automated and simplified, with less manual supervision needed to get the intended results.
Now things are getting more interesting and complicated, because we have such a wide range of new possibilities. There’s always something new that we want to implement. Mindbox provides even more functionality than we need.
I really like how the Mindbox team always responds to all our enquiries. Depending on what we’re asking, the response might be an explanation or a suggested solution, or a detailed reason as to why our question needs to be addressed elsewhere. Most importantly, they’ve done everything that we set out to do with Mindbox.
I would recommend Mindbox above all to anyone involved in online retail or other online business. It has very extensive capabilities for tracking user behaviour. I would especially recommend it to companies with limited human resources. With Mindbox a single person can run an entire company’s marketing activities, and that person doesn’t even need to be particularly tech-savvy.»
Head of digital marketing
«We’ve been working with Mindbox for more than five years now. That’s quite a long time, and I’d say that it’s indicative of the level of reliability and service we receive, of Mindbox’s understanding of our requirements and tasks and their fast response to our requests. I would emphasise here that all our contacts at Mindbox are very fast to respond. They’re great to work with, they’re always ready to go the extra mile, and to go above and beyond the original agreed scope of a task when need be. And they’re always thinking ahead on our behalf, sometimes this is really important.
I would recommend Mindbox to anyone who wants professional, expert service, who wants to improve on their own CRM system, build relationships with their end users and develop their business.»
How can you get the most out of Mindbox?
«Take someone who knows what the business needs and can clearly formulate their expectations, who is detail- and result-oriented.
Add to that constant scrutiny of performance indicators, throw in plenty of idea generation, hypothesis testing and a thirst for experimentation.
In other words, a complex and interesting project with a high degree of involvement from participants both on our side and on the customer’s side.»
Panasonic is very much one of these projects.
Georgi Rossinsky, project manager