Aucklanders have been eating out less but, when they do, they've been spending more.
That's according to new data released by business insight tool Ada, which offers New Zealand companies unprecedented information into consumer behaviour, including what Kiwis are spending their money on.
Ada is a collaboration between Paymark's Eftpos transaction data and Perceptive, a leading Australasian insight company. It uses the information gathered from more than a billion Eftpos transactions made each year, combining it with Perceptive's data science and visualisation capabilities to create a powerful business intelligence tool.
Perceptive General Manager Oliver Allen says: "Aucklanders are going out less often but they're spending more when they're out, so it's much more of a purposeful outing since pre-Covid-19 spending habits.
Ada's data shows that, in January 2021, the number of hospitality transactions was down 32 per cent compared to the same month last year – but average transaction value was up nine per cent.
"The hypothesis is that more casual, unplanned visits have dropped off and we're being more intentional about our visit behaviour in cafes, bars and restaurants – plus the lack of foreign tourists has meant casual walk-in visits have dried up for the Auckland hospitality sector, particularly over the summer period where many Kiwis head to the regions."
It was a different story in the regions, according to Ada's data. In September 2020, hospitality transactions were up 10 per cent and the average value also up 10 per cent – a result, says Allen, of Kiwis exploring their own backyards.
Ada's data abilities extend well past the ability to collate such trends – into valuable business insights.
"Typically businesses and retailers have really strong levels of info and insight from their point of sale systems in store, but they lose total visibility once the customer walks out the door.
"This also means they typically benchmark their performance against themselves, most often based on their performance from the previous year. But if you've grown two per cent and your competitors have all grown by six per cent, is this really a good result? This is where Ada comes in."
Ada shows how a brand's customers are shopping with them over time and how their customers are interacting with their competitors, says Allen: "It helps you to understand the whole customer experience."
Ada was launched a month ago and allows companies to unlock customer transactional data at a regional level; it provides bespoke filters to give businesses access to any specific segment of intelligence they need.
"With it, businesses can gain a complete picture of their customers, including a deeper understanding of retention and acquisition, and the impact and procurement of customer loyalty," says Ella Obreja, Head of CX and Data Innovation at Paymark.
Allen says the insights also show what peoples' online behaviour looks like versus their behaviour in store, plus how other companies' customers are interacted with.
"This identifies that they might spend a large amount with you and be considered a valuable customer – but they may be spending an even larger amount with a competitor. We break that info down and, from there, it's about taking the appropriate steps and developing strategies that can help with that."
Allen says one of the biggest lessons businesses continue to learn is that understanding customer habits is key and to hustle for new clients.
"The more you look into data from Ada, there are very few categories where true loyalty actually exists; there are few cases of people only ever shopping with one provider.
Most of the time what people call loyalty is actually a habit; habits can change very quickly.
"Making sure we're grabbing as much share of that customer's spend as we can is a must but you must also always have a focus on the people not spending with you currently and growing your overall customer base," he says.
Making the customer and purchase experience as easy as possible for consumers is fundamental to business success in 2021—and Ada's ability to breakdown a business's new and returning customers can provide a strong indication of whether businesses are really hitting the mark.
"People tend to gravitate to the path of least resistance. Making it really easy for customers to find and purchase what they need – that's a great indicator of a great outcome. The brain remembers these experiences and that creates repeat business."
Meanwhile, Ada data shows that revenue growth was up in almost every region across the 12 Covid-19- affected months to January 2021. Manawatu-Wanganui was the biggest winner with15 per cent growth.
The Otago region suffered the most, 12 per cent down for the year and attributed to the result of a perfect financial storm – the loss of two key industries, tourism and education, with overseas students unable to travel to the area for education.
The travel industry was one of the hardest industries hit but Allen says the scale of the financial loss was a real eye-opener: "It was confronting to see the impact on the travel industry, with revenue down 85 per cent – just catastrophic from a revenue perspective.
"Ada is able to track recovery as well and, as international travel slowly comes back, it will be interesting to see how that industry bounces back."
The recruitment industry was also a big revenue winner with 77 per cent growth, bolstered by highly skilled Kiwis returning to New Zealand. Floristry and Laundry services also experienced more than a third revenue growth.
"We saw these niche growth areas," says Allen. "Furniture, for example, saw a 25 per cent increase in revenue in the first quarter of 2021 compared to the first quarter of 2020. This is likely a result of people spending their disposable income on their home instead of travelling.