M&M Boosts Engagement and Bottom Line with Data Analytics

Need to Know

• After bringing on a new data analytics partner and going over 18 years of customer data to gather insights, M&M’s customer’s food baskets have gone up more than a dollar.
• Customer engagement is also up 15% since applying findings to their strategic marketing and operations.
• M&M’s click-and-collect services have been growing 50% for the past four years.

Analysis

CEO of M&M, Andy O’Brien, says that the company has had five straight years of comparable sales growth since the company was acquired by private equity firm Searchlight Capital Partners LP in 2014.

Once the executive team was chosen, O’Brien—previously with Kelsey’s and Montana’s Cookhouse—set about revitalizing the brand from its humble beginnings.

“People’s eating habits have changed, and we had to become more relevant,” says O’Brien.

What bolstered their transformation was that the frozen-food retailer was sitting on 18 years of unused information about nine million customers.

“We had about 40% of Canadian households in our database, but we weren’t using this information,” O’Brien told The Globe and Mail. 

After hiring predictive analytics and customer data company Retention Science (ReSci), M&M saw customer’s average food basket cost go up more than a dollar, profit margins rise, and sales per customer increase. Not only that, but customer engagement has gone up 15% thanks to the findings from the research.

“The average commuting time [in Canada] has doubled since the 1980s, so they’re getting home later,” O’Brien says. “People in households eat differently too–they have separate meals at different times.”

M&M has discovered some neighborhoods prefer buying chicken on a more regular basis, or pot roasts once a quarter, and have been able to target its marketing strategies based on these new findings, as well as invest resources appropriately. Some rural areas that couldn’t support a full-fledged store saw M&M forging new partnerships for dedicated shelf space with retail operators like Rexall.

Not only has M&M cleaned up its food by removing artificial sweeteners, colors, and sugars from all their food, but the grocer is now prepped to offer new foods based on consumer trends, whether that’s plant-based “meats” or gluten-friendly meals.

The adoption of data analytics for a mid-sized company like M&M is helping them compete in the same space as Loblaws, Sobey’s, and Walmart. 

O’Brien says that they’re not slowing their digital focus anytime soon, in an interview with Strategy Online: “The goal is to have 25% of our business based on e-commerce [sales], which is a significant amount for food, given that food typically [represents] under 10% if not 5% [of retailers’ business].”

Along with adding Express Stores in urban centers, renovating existing stores to be more customer-friendly, and introducing a new rewards loyalty program, M&M has also seen its click-and-collect business grow 50% per year for the last four years. 

Chief Operating Officer of ReSci, Derek Kwan says it goes both ways: “AI and predictive science helps customers find the products they like best, and the company can tailor its products and marketing to what the customers like.”