How Dixons Carphone overhauled its CRM programme

A focus on people and quick wins has allowed the UK’s largest electronical retailer to move away from a discount-heavy strategy it believes would have killed the business within five years.

Dixons CarphoneWhen Saul Lopes joined Dixons Carphone as head of CRM almost a year ago, the business was at the beginning of its transition from being a discount-heavy retailer to having a more customer-centred CRM strategy.

This wasn’t the first time he had joined a company in need of a CRM overhaul. In his previous job at Virgin Holidays he wanted to kick off a major transformation of how the business used CRM.

He presented a “lovely, shiny” business case to his boss, asking for millions to kick off this major transformation. But he was quickly rebuffed.

“I was one of those marketers who walked into an organisation four years ago and presented a lovely, shiny business case to my MD. I wanted to spend millions,” he told the Festival of Marketing earlier this month. “He just kicked it back and said ‘who are you? You just joined the organisation and want me to spend millions?’.”

Instead, he was tasked with finding some quick wins to prove himself and show the difference a bigger transformation could have.

“Never start a major transformation with a major transformation,” he adds. “Start with some quick wins in the beginning; prove yourself.”

At Dixons Carphone, the major transformation that needed to happen was the shift away from using CRM to talk about discounting to one where it focused on consumer needs.

“We knew discounting wasn’t the future for us,” explained Lopes. “It was ruining our margins, wasn’t creating future customer relationships and if we continued this type of strategy we would be out of business within five years.”

So many times in digital transformations we forget the very essence of where we should be starting our transformation: with the people.

Saul Lopes, Dixons Carphone

The first step of Lopes’s transformation was to focus on the people.

“So many times in digital transformations, you spend hours talking about different tools, we forget the very essence of where we should be starting our transformation: with the people,” he said.

“If you’ve got the right people but not the right business process, you’ll end up setting it up the right way, trying to apply your current business process to the brand new shiny new tool, so you’re basically murdering it slowly.”

Fortunately for Lopes, the right people were then when he joined Dixons. They wanted change and had the right technical skillsets. What they didn’t have was an environment and a company that wanted to accompany and support that change.

Then he began with some “tech quick wins”. He remembers thinking: “What tech can I bring to our business that doesn’t change our infrastructure, doesn’t change our data, doesn’t alarm our guys in IT, and just drives some really good stories?”

This included using AI to write email subject lines and copy, which helped increase click-through rates by 17%. Lopes also introduced a tool to improve personalisation and content automation, which in turn freed up creative resource.

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“You can’t implement new technology without changing your ways of working,” he said. “The worst thing you can do is implement your new technology with your existing ways and start to customise, customise, customise.”

Lopes has also simplified Dixons’s data sets significantly. When he joined, there were 1,800 different data variables and 300 tables. They were only using between 25 and 30 of those.

“We had data coming from all over the place, mashing up together, it gets overwhelming, where do we start?,” he said. “Focus on the data you use every day and the data points that add value.”

Lopes said one of the best decisions he made in his last transformation at Virgin Holidays was changing the CRM executive role to an analyst role, “so I really had someone owning the data and owning that big project”.

He also believes in naming an “innovation champion”.

“There will always be someone in a big team that wants to change and do things differently and champion that change within their own team. Give them better tools to work with, then at the same time you train everyone on new tools,” Lopes explained.

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While Dixons has made strides in creating a more customer-centric CRM strategy, Lopes said he is still very focused on improving its customer communications and personalisation.

“Where we really want to get to, is how can we create an organisation more focused on the customers and empower our front end employees with customer data that can help them with that sale, assist the customer experience, and create more of a relationship with [other parts of] the business,” he said.

“At Dixons, what I do is focus on a data set and initiative that can drive a lot of revenue. Combine that with getting the basics and house sorted. If you lump that all into one single project then you really have a good ROI.”