START WITH THE CUSTOMER WHEN MERCHANDISING THE ONLINE STORE, AND THE
RESULTS WILL BE ALTOGETHER MORE EFFECTIVE, WRITES CHLOE RIGBY
Relevance is to internet shopping what location is to the high street. Retailers value a key spot on the main thoroughfare because “they need to be where their customers are”, in the words of Michael Mokhberi, chief executive of self-learning personalisation software company Apptus. The philosophy, he argues, isn’t so different online.
There, he says, the equivalent of the well-known location, location, location maxim of the high street is “relevance, relevance, relevance”. Both, he says, deliver similar results. “From what we’ve seen, customers spend much more time with you when you’re relevant. People stay with you longer, and they come back more often.” All of this adds up, he says, to a higher customer lifetime value, and to a more profitable, sustainable business model. By starting with the shopper, merchandisers are show are of genuine interest to them. The emphasis is slowly moving on from showing website visitors products that are likely to be of interest to people like them, which is to say, products targeted at different segment of customers, classified by demographic detail such as gender and age. Rather, retailers are now working to show the visitors who are browsing their website specific products that they know to be of interest to them as individuals, becouse of their current website behaviour and past purchase history, meshed with personal information from sources such as social media. Merchandising technologies from search to recommendation and personalisation software enable this to happen in real-time, at scale.
THEORY INTO PRACTICE
Retailers who already see the importance of making sure they show the customer the most relevant items include fashion retailer New Look. Its ecommerceand multichannel director Shivani Tejuja told the Internet Retailing importance of relevance in displaying products customer what they want, wherever they want it,”it and us thinking through the customer journey and touchpoints, no matter what channel they’re in.”
In search of this end, New Look deploys merchandising tools from search to navigation and typical New Look customer journey, Tejuja explained how one shopper, ‘Charlotte’, might interact with the New Look site. Charlotte’s journey starts when she reads about a New Look dress in a magazine and tweets about it before moving to Google to search for it. It’s a research she breaks off to go out and meet a friend for coffee, but then continues from her mobile phone while out and about. “By the time [Charlotte] came home there was an email in her inbox saying you’ve been searching for this dress, you’re still interested,” says Tejuja. “Th*/at took her to the site where a display banner told her about the dresses available in the sale, she ordered the dress for in store collection”. Cross-selling and upselling then come into play in the stop, explains Tejuja. When [Charlotte] went into the store, staff were able to personalise the experience by offering her other items. At point they realised she wants her New Look dress but why not offer her the great handbag that we have that matches that dress. She gets a personalised experience with the right product offering, and goes and makes a full purchase so that she can go out that night.” The journey ends with a tweet about the dress that has been bought and now worn. At the heart of it all, says Tejuja, is the personalisation and relevance that lends itself not only to buying experience but also to selling.
SPEAKING FROM EXPERIENCE
“The equation that retailers should try to solve is not
about momentarily boosting the conversion rate. It’s more a matter of ‘what kind of philosophy should I have to make my customers want to buy more from me during the whole year?’ We believe that the best way to do that is to delight customers, be relevant, make them want to come back and stay in our store.”
Michael Mokhberi, chief executive, Apptus
“Mining site search data, such as information about what customers search for and the search terms they use, allows marketers to be more effective in merchandising products and anticipate changes in market interest.”
Marcus Law, marketing manager, EMEA, SLI Systems
CUSTOMER AT THE CENTRE
“For us it’s just keeping the customer in heart and delivering a personalised experience for them no matter where they are.”
Shivani Tejuja, ecommerce and multichannel director, New Look
Beauty brand L’Oreal also emphasises the importance of the relevant shopping experience in its plans to grow direct ecommerce sales over the course of the next three years. In order to achieve that, it is rengineering its global online presence. One of its key aims, Said Vincent Stuhlen, global head of digital at L’Oreal Luxe, speaking at Demandware Xchange European Summit 2013, was to acknowledge a change in the way we now shop that is no less than a “revolution” in customer behaviour. “Everybody’s talking about the customer and the way their purchase habits are changing, the way they interact with devices is changing, the way how they relate to brands is changing, but it’s not an easy task, changing a product-centric company to really embrace that customer prospective. For us it was quite a big journey to start designing things from that whole new perspective”. usability testing, focus groups and A/B testing all played their part in developing L’Oreal’s new approach. The new approach included developing central flagship sites, built on Demandware, for each of its 16 luxury brands, from YSL to Giorgio Armani Beauty and Shu Uemura. Each brings brand content together with ecommerce functionality. Innovations developed in its lab are added on top. Each site is designed as a global reference site, which can, where relevant, be customised for the local needs of each market. Each was also designed around the customer’s needs. The benefits have been seen in higher sales, driven by “immersive content”. Meanwhile, Stuhlen says conversions have increased, thanks to an automated personalised shopping experience.
THIS TIME IT’S PERSONAL
Because consumers place a high premium on relevantproduct information, it’s important to get it right.
Results that over-generalise may well prove wrong atthe individual level.
“Just because you’re a girl,” says Apptus’ Mokhberi, “it’s not a given that you like girly things.”Quite so. While retailers have become used to of customers, the technology is now moving on.
“More and more retailers will realise they need to adapt their customers in a much more efficient and much more accurate manner,” says Mokhberi. “We try to make that possible not only with technology but also methodology.” The focus in recent years has been on using data to find answers about what individuals are likely to be interested in. Now, says Mokhberi, information systems are becoming better at mimicking the intuition that the experienced sales assistant would use to offer purchase suggestions to a customer, using their own experience of previously serving similar people in similar situations. “The future is about really understanding the metrics of relevance and the needs and behaviours of your customers so you can automate the basics of delivering relevance,” says Mokhberi.
SLI Systems EMEA marketing manager Marcus Law says merchandising is all about putting “front and centre the items your customers want most.” He adds: “Like a personal shopper, let your customers lead you to their favourite items and then suggest other similar pieces, tell them about special promotions and don’t lead them away from their
If search results aren’t relevant, says Law, “Your visitors may well abandon the site.” He adds: “As consumers, it seems the more technology savvy we become the more impatient we also become.” He points to SLI’s own research, which found 73 per cent of people will leave a site in less than two minutes if they can’t find what they were looking for, some 36 per cent never to return. But when they do find what they’re looking for, visitors who have used the search box are more likely to make a purchase than those that haven’t. So how do retailers make suresearch results are of interest? “To achieve the kind of relevancy that keeps impatient shoppers like me on your site, you should learn which products are most clicked on for each search term and all its variations, and then rearrange each associated search results page accordingly,” he says. “Doing this manually would be incredibly tedious so it’s important to use a site search engine that dynamically learns and delivers the most relevant products to potential customers.” The technology, he says, should enable retailers to reorder search results by promoting, demoting or hiding products from search. Retailers can also use searchandising tactics and promote items that have high margins or are new in, while demoting those that are out of stock.
As well as showing customers what they’re looking for, merchandising technologies such as search and personalisation produce large amounts of data that retailers can learn from. By gaining information on customer preferences, retailers can create evermore targeted campaigns for the future. Even thewords that customers use when they search can help retailers to serve them, either by enabling thekeywords they use to trigger relevant banners on the site or by reflecting back at the customer. “Site search data also identifies the language your customers use when searching,” says Marcus Law of SLI, “so youcan be sure to incorporate that language into product descriptions and other areas where appropriate.” Constantly evolving technology is taking retailer sever closer to the possibility of being individually relevant to thousands of customers. As always the challenge is to choose the approaches that are relevant to for each retailer, and enable them in turn to be more relevant for their customers. It’s not an easy task, but it is one that is evolving the relationship between the customer and their trusted retailers.
The focus on the individual customer has become ever more forensic as
technologies move beyond targeting small groups of people towards the goal of
treating each website visitor as the individual they are. Expect to see that focus
become more ﬁnely honed over the year ahead – and to ﬁnd that customers start to
expect merchandising systems that differentiate between them and their peers to
show them what they individually want to see. Retailers are also learning to let go –
to show the customer what the customer wants to see, rather than what the retailer
wants them to see.