Snacking on Data: How Graze Uses Analytics to Deliver Personalisation and Multi-channel Growth
Graze, the British healthy snack company that delivers delicious yet nutritious nibbles in slim cardboard subscription boxes, has been making healthy bites exciting for thousands of happy snackers since its launch in 2008.
Now a £68 million revenue business, it’s success can be put down to a range of canny marketing techniques. From maintaining a lively blog filled with recipes and nutritional tips to its fun and interactive presence on social media, and from direct-mailing offers to forming numerous strategic business partnerships – Graze has exploited practically every channel in order to achieve the growth that it has thus far.
But, what has proven to be the most effective differentiator for Graze is of course it’s dedication to personalisation.
Graze produces around 500 product lines. Working from a kitchen in the roof of an office in Richmond, staff mix and match almonds, cranberries, coconut shavings, chocolate pieces, walnuts, chopped dates, raisins, lingonberries and a whole host of other “natural” foodstuffs, completely free of all artificial ingredients. Each combo is packed in a tiny punnet, and the punnets go into a slim cardboard box four or eight at a time. Mathematically, this means that there are around 20 million possible combinations that could end up in any one Graze box.
Importantly, Graze doesn’t want to just simply ship out its snack boxes to customers with random contents. Rather, it wants to ensure that they are delighted with each box that arrives their door or desk, and even be pleasantly surprised with what’s inside. This means ensuring that each box contains not only snacks that each customer will like, but also some new things that they might not have tried before.
The challenge, however, in getting such personalised delights right every time, is in trying to ensure that customers don’t receive food items that they hate, or, indeed, are allergic to.
Personalisation Means Data – And Lots of It
Existing almost entirely online – with just two offices and two distribution centres (one in the UK and one in the US) – Graze, with its 31 IT staff, has data-driven technology at the heart of its business. Running on AWS, 11 different algorithms employ more that 20 different, configurable strategies. According to an article in The Register, Graze claims that these algorithms are shaped and informed by 300 million customer ratings (i.e. individual click ratings for snacks that customers put into categories of "try", "like", "love", "bin" or "send soon") at a rate of 15,000 an hour.
These algorithms – and specifically one named DARWIN (Decision Algorithm Rating What Ingredient’s Next) – are responsible for customising the snack boxes, based on customer preference data, as well as on other factors such as nutritional balance and ensuring that the customer receives variety. DARWIN runs tens of thousands of times a day, according to The Register.
“Graze is a data-fuelled culture,” co-founder and chief technology officer Edd Read said. “We use it to make enormous decisions – we are incredibly inquisitive, almost obsessive on some things.”
Graze doesn’t just rely on data to deliver perfect snack boxes every time – the company also mines the analytics to achieve business growth as well.
When Andy Gibbs joined Graze as CFO in 2012, there was just one core product – the variety snack box. But, since then, Graze has introduced a children’s range, a breakfast range, a larger sharing box, and has of course branched out into the US market. Talking to Real Business, Gibbs describes what has been at the centre of growth for the company:
“Data has been at the heart of what we’ve done. As we’ve gone on the complexity of the data has increased, but with that our ability to use it to drive forward has improved. A good example is how we look to segment our customer base. The fastest growing segment is actually suburban mums, away from the perception that we focus on young office workers.”
Indeed, Graze has realised that if it wants to keep growing its customer base and appeal to wider demographics, then it needs a presence offline as well as online. In July 2015, Graze started selling its snack boxes through the traditional high-street supermarket retailer Sainsbury’s. And then, last year, Graze hired Expedia customer guru Clive Peoples to support the next phase in its multi-channel growth – mobile.
According to the data, more than 60% of Graze web traffic comes from mobile devices – and Peoples wants to make sure that Graze is delivering integrated and personalized mobile experiences of a standard befitting of the company.
“Winning a place in customers’ smartphones is key to double digit growth in ecommerce,” said Peoples in Retail Times, “and what attracted me to Graze is the enormous potential of a true multi-channel food business. Graze is already forging the way for the food industry, reporting an impressive number of customers interacting via mobile, giving them a fantastic opportunity for future growth. I know of no other food business better placed than Graze to take the lead in this growing mobile market.”
As Graze moves into the multi-channel space, new revenue opportunities are opened up as both existing and new customers have multiple points for purchase. This is the next stage of the company’s growth – with new investments in mobile delivering even more personalised delights, customer experiences can continue to be improved with ever-increasing convenience.
The last word goes to Graze CEO Anthony Fletcher:
“Graze has always been at the forefront of innovative technology, and we’ve taken this pioneering attitude beyond our pure play roots and placed it at the heart of our multichannel strategy. Investing in different channels allows us to experiment with the best ways to reach existing and new customers, and Clive Peoples’ guidance can make us a leader in mobile within the food industry. It’s all part of our ambition to leverage our different channels to better explore consumer behaviour and customer journeys. We’re experiencing huge demand from customers on the go and on their mobiles, and we need to satiate these cravings to achieve our goal of becoming the number one healthier snacking brand in the UK.”