As head of customer engagement at consumer electronics retailer Elkjøp, Jimmi Frederiksen, is responsible for developing and implementing MarTech strategy across the Nordic markets. His work focuses on creating the architecture to ensure a flexible, scalable, and data-driven customer experience.
For a long time, the formula for a successful retail loyalty programme seemed straightforward: give points or cash back, and watch faithful customers power your repeat business.
But, as a new report from BCG shows, those things are no longer enough. Today's customers, particularly younger ones who are quicker to try new brands, are looking for more. According to the report, they value experiences that feel custom-built — personalised perks and genuinely helpful, readily available content.
At Elkjøp, the largest consumer electronics retailer in the Nordics, our loyalty club boasts an impressive 8.6 million members. Yet, we weren't fully realising its potential.
In fact, we faced a stark reality: a mere 3% user recognition rate on our website. This disconnect limited our ability to deliver the always-on, personalised experiences our customers expect, optimise their journey, and steer our marketing with precision. We needed to flip the switch.
Building a privacy-focused foundation
Alongside our agency, Dentsu, we looked at ways of maximising the value of our first-party data. We began by mapping every potential touchpoint where a user ID could be captured in a privacy-safe way. The user ID feature in Google Analytics allows you to connect your own identifiers with users to measure activity across platforms.
This included the obvious — loyalty club members logged into their accounts — but extended to identifying customers arriving directly from our email campaigns by embedding unique user IDs in the URL parameters.
Crucially, we integrated server-side tracking using Google Cloud Platform, specifically leveraging Firestore. This technical enhancement allowed us to significantly boost user recognition while maintaining a strong focus on user privacy.
“With Firestore, we can perform lookups against Elkjøp’s entire member base in just milliseconds,” explains Anders Gyrup, innovation lead at Dentsu.
This includes methods like real-time lookups at checkout for club members who weren't logged in or arriving via an email link, by matching their entered email address against our customer database to retrieve any associated ID.
“Besides the user ID, other identifiers are also stored, including their Google and alternative platform IDs, or hashed email addresses,” continues Gyrup. “We use these identifiers for lookups when we don’t have a user ID to enhance the recognition rate. As the solution is privacy-by-design, we won’t share hashed email with any third parties, just use it as a parameter in the lookup. And this action will only be done if the user has accepted cookies.”
Our guiding principle was simple and clear: ‘You are you, no matter what Elkjøp channel you are in.’ Because, as the BCG report confirms, companies with successful loyalty programmes build consistency, paving the way for those personalised perks we all crave.
Supercharging user recognition from 3% to 25%
By layering these various identification methods, our user recognition rate for our loyalty programme members surged from 3% to 25% in just one year.
This 8X increase takes us a step closer to where we want to be, and that is to reach a 80% match rate. We know this is achievable, having spoken with other retailers who have around 65% user recognition.
While the immediate win was the improved recognition rate, the broader implications include more sophisticated marketing strategies due to the ability to create richer audience segmentation.
Moving beyond basic demographic information, our data science teams built more nuanced and actionable segments based on actual shopping behaviour and interests:
This allowed us to pinpoint high-value or likely to buy customer segments with greater accuracy and gain a much deeper understanding of their specific needs and preferences.
For instance, if our data signals a customer segment showing a strong interest in kitchen renovations, their website experience can be automatically tailored to prominently display relevant kitchen designs and offers.
This level of dynamic personalisation isn't confined to just one channel. We're actively working to extend these custom-built experiences across all our communication channels, including email marketing.
These offerings clearly improve immediate engagement and foster loyalty. And they build crucial long-term expectations for the kind of tailored value a company like Elkjøp can consistently deliver.
Plugging into the future: Data-driven loyalty
Our ambitious goal is to transition towards a state where the vast majority of our offers are directly driven by intelligent data insights, representing a significant and fundamental shift from our previous, more generalised marketing practices.
This requires not only successfully and accurately identifying our customers across every touchpoint, however. We also need to develop a deep and comprehensive understanding of their individual preferences. This will help us create a more consistent, highly relevant experience across every interaction they have with Elkjøp.
As the latest BCG research underscores, truly effective loyalty programmes are deeply integrated with a company’s broader value proposition.
This project underscores the absolutely critical role of first-party data and deep customer understanding in navigating today's increasingly privacy-aware world and building lasting customer loyalty.
