How GALE's Alchemy Platform Serves Chipotle Customer Insights

Note: To make sense of what is quickly becoming a vast and complex agency technology ecosystem, Adweek is reporting on each of the major platforms. This story is the sixth in a series covering agencies’ audience management platforms. Previously, Adweek reported on Omnicom’s Omni, Horizon Media’s blu, Havas Media Group's Converged, Publicis’ Epsilon PeopleCloud and PMG's Alli. Before it launched Chipotle Rewards in 2019, Chipotle didn't have a sophisticated CRM program, Tressie Lieberman, its vp of digital marketing, told Adweek. "We knew that we had an opportunity to create this more one-to-one relationship," the marketer added. The brand launched the loyalty program in 2019, and some months later handed off first-party data on 4 million customers to the Stagwell transformation agency Gale. The agency then fed that data into its proprietary customer data platform, Alchemy. The tool analyzed the data, gleaning insights about Chipotle's customers that the brand used to its marketing advantage. It tapped Alchemy at the right time, because soon Chipotle's loyalty program ballooned. By the end of 2022, 30 million consumers had signed up. Gale is a "business agency," Brad Simms, Gale CEO and president, recently told Adweek on the heels of it winning the 2023 Breakthrough Media Agency of the Year award. Media is Gale's fastest-growing unit and makes up about half of the agency's $120 million in revenue. Since executing media buys hinges on detailed audience insights, Alchemy is the backbone of such success. "[Alchemy] is a tool that allows us to really understand our clients' business to figure out how to help them grow," Simms told Adweek. The only Stagwell agency using Alchemy Many agencies are developing advanced technology platforms to aid their media planning and buying processes. Whether built or bought, these tools help agencies ingest and organize data, and target specific audiences. Often during reviews, CMOs observe the similarities and differences between these platforms, which guide their decisions about which agencies to work with. "The rapid growth of Chipotle Rewards really put a spotlight on the need for a robust mar-tech stack and the ability to really understand who our customer is, what they're doing and how to get that next best action out of them," said Jason Scoggins, Chipotle senior director of loyalty and CRM. Alchemy is just one of several Stagwell platforms aiding media management. While other large agencies often share their data platforms with sister agencies, Gale is the only Stagwell Brand and Performance Network agency using Alchemy. This, according to Gale's CEO, is primarily because Alchemy is ISO-certified, meaning a third party vetted and approved of its data management practices. "The bar is a lot higher, which is why it's not widely used across Stagwell. Frankly, there's just a lot of overhead associated with managing the security and the policies," said Simms. Clients that use the technology each have a version of the platform unique to them, said Simms. If a client relationship ended, Simms said Gale would "purge" its Alchemy environment, ensuring data privacy. Stagwell media agency Assembly utilizes another optimization tool called Stage. It complements Alchemy, but serves a different purpose. Alchemy reveals insights gleaned from clients' first-party data, whereas Stage is a media buying and optimization platform. Stage fuels what Simms called "prospect media," or developing look-a-like audiences that might, when targeted, become new customers. Breakthrough Media Agency of the Year Gale Deftly Blends Data, Creativity and Velocity Catching customers before they defect Alchemy built models for Chipotle's customer journey, grouping customers' common characteristics into three categories: welcome (new customers); defection, (lapsed customers); and reactivation (returning customers). One model developed using Alchemy studies deviations in Chipotle customer behavior to spot signs of brand dissatisfaction. Chipotle can then intercept the dissatisfied customer before they defect, according to Scoggins. "Being able to identify a customer at that exact moment when they break from their pattern has really been something eye opening for us," he said. Before Alchemy, if Chipotle assumed customers defected within six months of making their last purchase, it might attempt to retain them by emailing them a month before. The old strategy treated defecting customers as a homogenous group. Now Chipotle marketers can pinpoint when a specific customer changes their behavior and take immediate action. "If you're buying Chipotle five times a week and all of a sudden you stop, that's very different than someone that buys it once a month and then stops. Treating those two customers the same just doesn't make any sense," said Simms. How Alchemy works The agency's data science team pulls insights from Alchemy-ingested data, but its planners can also access anonymized data using the platform. An example provided to Adweek shows that a planner can view ice cream purchase data within the platform to determine how many buyers of a particular ice cream brand highly value spending time with family. The planner can also see if a buyers' propensity to enjoy family time changes if they prefer a different ice cream brand. To make this possible, Gale imports anonymized customer data into Alchemy and then continually runs machine-learning models against the data to search for new insights. "We're always running journey trigger models or product preference models," Simms said. "How we use it with Chipotle, which is in a multi-technology environment, is different than how we use it with H&R Block or Dropbox," he added. How PMG’s Alli Data Platform Tailors Madewell’s Media Strategy Gale leaders stress the platform is a flexible solution that exists beside customers' tech stacks. Since working with Gale, Chipotle partnered with other tools like Salesforce and Snowflake that integrate with Alchemy. "As they've continued to increase their sophistication and bring stuff in house, we continue to work with that and integrate into that," said Simms.