How Costco could use customer data to save lives

by Next Wave Team | Mar 24, 2020 | 1 to 1 marketing, Retail

There is a reason companies involved in retail food distribution are paying their employees a premium during the Coronavirus Crisis, workers are risking death to come to work. And while the idea of strolling through the aisles and shopping as if nothing has changed may be reassuring to many, with every touch of a freezer door handle, checkout register, or close contact with a cashier, the risk of transmission rises. This is not how to do business in a pandemic, especially if you are sitting on every customers complete buying history through your database.

Costco has already seen the mad effect of hording, and has limited purchases of items in high demand. But, this still doesn’t solve the human interactions involved in processing these sales using their conventional sales processes. And, setting certain hours aside for seniors is nice, but, not protecting your employees anymore than normal.

This is a new normal, and the solution is simple: Build a list of every customers historic purchases based on frequency of purchase over the last 3 years. Create a pick list, with items purchased most often at the top. Send a pre-built cart to the customer via their customer ID- allow them to place an order, and have it picked, waiting for pickup outside the store at a designated time. Set the limits based on historic purchases- ie: I buy 18 rolls of Kirkland toilet paper every 8 weeks. The same would go for the new reality.

The non-grocery purchases, from toaster ovens to TV’s would still be available via the same cart- without restriction other than inventory constraints. And while there are some items that Costco may stock that I may need that are in high demand, but, I’ve not bought before, like a thermometer or hydrogen peroxide, these would be managed like any other inventory item, as needed, after the people who’ve historically bought it regularly have had first dibs.

While this system is being built for the Coronavirus crisis, it may become the new norm, especially as more people learn to plan more, shop less and realize that time is still a precious commodity.

As to the additional cost of having employees pick and fill orders, add a per order surcharge based on the size of the order. Trust me, customers will be willing to pay, and employees will feel a lot safer not having to interact with as many customers and risk contamination.

While this isn’t possible for most smaller businesses who don’t have the customer data, or the technology behind it, if there is anything this crisis will teach companies- it’s the value of a seasoned employee, who knows your business and how it operates. The costs of training, the costs of hiring, will become incredibly clear for those who lose parts of their workforce due to the pandemic.