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Catalina turns laser focus to data as it personalizes the shopping experience

Margie Manning



Catalina President and CEO Jerry Sokol with Marta Cyhan, chief marketing officer

Catalina, a St. Petersburg-based digital marketing firm, knows what you like to buy and why you like to buy it.

The company, once known best for the printed coupons handed to a shopper at check-out in the grocery store or drug store, has transformed into a big data operation, with two years of purchase history on 650 million shoppers.

Catalina uses that data to understand what consumers want and how to incentivize them to make purchases, on behalf of the hundreds of brands and retailers that are Catalina clients, ranging from Winn Dixie and Walgreens to Jif peanut butter and Gerber baby foods.

“We help our customers, either consumer packaged goods brands or retailers, convert their shoppers to buyers and their buyers to loyal fans, or repeat buyers,” said Jerry Sokol, who was named Catalina president and CEO in October.

Catalina’s management team (from left): Marsha McGraw, president, US Sales; Wes Chaar, chief data & analytics officer; Wes Bean, senior vice president, global network development & US retail market; Jerry Sokol, president and CEO; David Glogoff, chief legal and administration officer; and Marta Cyhan, chief marketing officer.

Sokol and most of the Catalina management team took part in a media roundtable at the company’s Carillon headquarters Tuesday, nearly two months after completing a financial restructuring and emerging from a Chapter 11 bankruptcy. The company cut its debt by 85 percent, from $1.9 billion to $276 million, and has new ownership, made up of its lenders — financial service companies such as Oppenheimer, Bain Capital, Carlyle and Bank of New York Mellon, with a combined $1 trillion in assets.

Strategic shifts

Sokol, a veteran of Amtrak, AOL and Vertis Communications, one of the largest printing and targeted direct marketing companies in the U.S., was drawn to Catalina because of the size and scope of the business.

“Coming into it, and this was my take, Catalina very much viewed itself as a print company, printing coupons out to consumers at the register. I saw something different. I saw the key asset of the organization was the data piece, and how do you leverage and mine that data and turn it into an asset? Not only an asset, but how do I take that asset and generate some revenue from it?” Sokol said.

In his first three months on the job, Sokol focused on financial restructuring and also met with customers, both in person and on the phone.

“Many of them viewed us more as a transactional type company. That was one of the first strategic shifts for us. How do we become much more strategic to them, how do we become a go-to partner for them?” he said.

Another concern was developing a presence across multiple platforms.

“When I came into the company we were primarily just in store,” Sokol said. “One issue [clients] are trying to solve is how do I communicate to my customer across all platforms, anytime and anywhere, and make sure the message I’m delivering is consistent. They don’t want to give you something at the register for 20 cents off and then on the phone give it to you for 50 cents off.”

The answers came out of a conversation that Catalina salespersons had with several customers.

“Who else can come in with the most advanced behavioral-based data tools and insights to craft – and this is the most important part – customized audiences for your brand, and then we can activate against them, anytime, anywhere, in real time,” Sokol said.


Catalina recently partnered with GlobalLogic, a Silicon Valley-based digital product engineering firm, to speed up innovation and product development.

The company also created an ID graph that connects the dots between the digital ads shoppers see and the items they actually buy in the store. That product was developed by a team led by Kevin Hunter, chief product officer and head of innovation, and launched in February.

That’s critical as marketers seek to spend less and sell more, said Wes Chaar, Catalina’s chief data and analytics officer.

“The reason this is important is because you want to engage the consumer at the right time, with the right message and the right offer,” Chaar said.

Catalina has a growing team of data scientists and analysts in Atlanta. Its own data is enriched with additional third-party data to give a complete view of shoppers’ preferences. Artificial intelligence and machine learning give Catalina a framework to analyze that data, which has exploded in recent years, especially after the growth of social media platforms, Chaar said.

Catalina has turned that analysis into what it calls “buyRscience” that unlocks each shopper’s unique DNA profile.

“We understand the science behind every buy and that unique buyer behind the data,” said Marta Cyhan, chief marketing officer.

No two shoppers are the same, said Marsha McGraw, president, U.S. sales. One shopper might be looking for value and want a discount, while another might simply need a reminder to buy a product. Catalina’s data helps its clients understand want consumers are looking for.

“I think of it as layering,” McGraw said. “For close to 30 years, Catalina has identified consumers who are buying and targeted them with an incentive. Now we layer on top of that. Who needs a high value incentive and a low value incentive? Who needs continued reminders and who is buying normally? They might be buying [a product] but what else could they be buying in the company’s portfolio that has the same type of attributes?”

Personalization allows retailers to solve problems for their customers, said Wes Bean, senior vice president, global network development and U.S. retail market. For instance, a single mother on WIC needs value to stretch her budgetary constraints to the end of the week, while a millennial foodie might be looking for that a gluten-free product.

“The challenge every retailer is facing is how do I find a way to communicate what I’ve done from an assortment strategy standpoint to deliver that relevantly to the shopper who that matters to,” Bean said. “So being able to use the science allows them to solution shop when they go in there.”

Catalina also has developed a dashboard, dubbed Hub 360, that allows its clients to see how buyers are reacting to marketing campaigns. That lets those clients shift gears quickly if a campaign isn’t producing expected results.

Privacy concerns

Eighty-three percent of shoppers want to be marketed to in a personalized way, but they believe only 23 percent of retailers are doing that well, Cyhan said.

Still, big data can be a scary thought for some consumers.

“If people are relevant and respectful I think people are OK with it,” Cyhan said. “Where I think they get uncomfortable is when it’s irrelevant and it feels like someone is watching you.”

Catalina is very focused on making sure its data is secure and that it respects privacy laws, said David Glogoff, chief legal and administration officer. The company masks individual identities as well.

A decade from now, Catalina’s technology will be even more sophisticated, Sokol said.

“I think this company’s revenue will shift from promotions to more data and media. Promotions will be still be a big component, but instead of 90-10, I think it will be 50-50,” he said. “Right now it’s untapped and it has no ceiling at this point.”

While it is possible Catalina could return to being a publicly traded company as it was until 2007, Sokol prefers to remain privately owned. That gives the company more flexibility and allows it to take a longer-term view, he said.

Catalina by the numbers

Employees worldwide: 1,200

Employees at St. Petersburg HQ: 300

UPCs scanned daily: 2 billion

Product label attributes analyzed: 420,000

Stores: 44,000

Retail banners: 125




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