January 2009 - Feature: A Personal Touch

Integrating customer data across applications to deliver more targeted marketing messages and improved customer experience
By Shaun Ryan

Online retailers spend a significant amount of money for systems that gather valuable data about customers and their purchases-but often this data remains siloed in disparate systems, without being repurposed in other ways. However, smart retailers are realizing the power of integrating data across applications to facilitate more personalized marketing efforts, with the goal of strengthening brand visibility and loyalty, and improving the customer experience.

Footwear etc. is seeing more willingness on the part of shoppers to make purchases when they receive personalized e-mails.

Faced with a challenging economic climate-and, no doubt, reduced consumer spending for months to come-retailers have a powerful opportunity to gain more value out of the information they have at hand by using it across multiple marketing applications. In doing so, they can put more targeted messages in front of customers-whether it be on the company’s e-commerce site, in personalized e-mails, paid search listings or other methods.

A recent poll SLI Systems conducted of more than 300 online retailers showed that the technologies they deem most important for promoting their brands, include site search, search engine optimization (SEO) and e-mail marketing. The survey also found that e-commerce companies plan to rely more on social media tools such as blogs, podcasts and user-generated content to strengthen their brands.

These various technologies, when used wisely, can not only give your brand better visibility on the web and in natural searches, but can also prompt consumers to choose your products over your competition when they’re deciding which retailers to patronize.

What makes search, SEO and e-mail marketing unique is that they’re all valuable tools for gathering information about customers and prospective customers. For instance, their product and brand preferences, as well as demographic and geographic information can be used for personalizing content on a website, or for creating more targeted, customized promotions. While many marketers have access to this data, it becomes most effective when important details can be integrated across applications to create even more compelling customer interactions.

In particular, site search offers many opportunities to improve marketing efforts. As seen from our recent survey, retailers understand that search is one of today’s key tools for driving conversions, and for creating an engaging shopping experience. When shoppers can easily search for the products they want, and receive relevant results, they buy and spend more-and they return to that retailer. When shoppers are frustrated by a search that returns results that have little to do with the sought-after items, they quickly leave, possibly never to return.

But effective site search does much more than that. It gives you valuable insight into what your customers are looking for-the terms they’re searching with and the items they’re clicking on. Armed with that data, you can incorporate these terms, and the popular products for those terms, in marketing messages delivered by e-mail, banner ads on your site or paid search listings, to name a few.

Sunnyvale, Calif.-based Footwear etc. (www.footwearetc.com), an online shoe retailer, is a prime example. Through powerful site search and e-mail marketing technology, Footwear etc. combines customer product preferences with search to create personalized e-mails for its customers.

For instance, shoppers who register at the footwear site can create personal profiles that include their shopping preferences-everything from shoe size to color to type (like boots or heels). Using this data, Footwear etc. can pull information from its site search solution on the most popular products that meet these criteria and generate an e-mail that specifically promotes the items or brands that the customer indicates he or she is most interested in. These personalized e-mails include the name of their preferred brand in the e-mail subject line-making the message even more appealing to a shopper and increasing the open rate, click-throughs and conversions.

When Footwear etc. decided last September to launch more personalized marketing e-mails, the company conducted a side-by-side test: The first group of customers received a non-personalized e-mail, which simply included popular new products and sale items based on data pulled from the company’s site search reports. The second group of shoppers received the personalized e-mail that showed their brand preference in the subject line and products based on their preferences in the body of the e-mail.

The open rate for the first, non-personalized group was slightly more than 11 percent; the open rate for the personalized batch was slightly more than 27 percent. The click-through rate for the non-personalized e-mails was 3.4 percent; for the personalized messages, it was 12.9 percent. In both cases, the personalized e-mail had a three-times greater likelihood of being opened and an item being clicked on.

Mike Baranov, director of online operations at Footwear etc., says the results of the test were encouraging, and explains the company is also seeing more willingness on the part of shoppers to make purchases when they receive personalized e-mails. “The shoppers who received e-mails personalized to their preferences were twice as likely to buy as the shoppers who got the generic promotional e-mails,” Baranov says.

Another strategy used by some online retailers is to bring together user-generated content with other applications such as search. Mighty Leaf Tea (
www.mightyleaf.com), based in San Rafael, Calif., allows shoppers to search for specific teas, along with their corresponding user reviews, and then filter those reviews.

For instance, when a visitor to the site searches for organic Earl Grey Tea, he or she will come to a product page with more than 60 reviews. To ease the process of perusing so many reviews, visitors can filter the reviews based on their own tea preferences (like “whole leaf tea” and “great aroma”), which would also be preferences shared by other reviewers. The result: a smaller number of even more relevant user reviews. The process makes use of search data, as well as technology used to sort and filter the user-generated content.

“The ability to help fine-tune the voice of visitors-and to see opinions from users with the same preferences-can encourage site visitors to shop longer and convert them to buyers,” explains Mike Svatek, vice president of product strategy at Bazaarvoice (www.bazaarvoice.com), which creates solutions that help online companies manage user-generated content.

Mightyleaf.com allows shoppers to search for specific teas, along with their corresponding user reviews, and then filter those reviews.

Mining site search information to improve SEO and paid search campaigns is another smart way to integrate data across applications. Search engine marketing company Impaqt does this with its clients, gleaning info from search behavior to boost effectiveness of its marketing efforts.

“We can learn a lot from search behavior on a site,” explains Dan Gbur, vice president of sales and business development at Impaqt. “We can analyze this data, and make search campaigns more effective.” For instance, search data can be used to create customized landing pages for SEO paid search campaigns, and also creates “related search” links on site search results pages- increasing the likelihood they’ll rank on the first or second pages of Google or Yahoo.

For instance, for a luxury-goods client with an online storefront, “we look at keyword profiles all the way through to a conversion,” Gbur says. In other words, using site search information, Impaqt can identify the term that shoppers use-and that will likely lead to sales. “Long-tail keywords might not always offer the highest sales volume, but they may represent the search terms that are most likely to convert,” he explains.

So, how do I get started? Integrating data across applications will help you respond more effectively to your customer preferences-and increase the likelihood you’ll capture a sale, and even create a long-lasting relationship. If you’re considering making better use of data in your technology solutions, here are some ways to begin.

Ramp up data-gathering efforts: Retailers can gather data on just about any type of online activity. However, the web provides even more options for parsing information. Make use of data from sources such as customer product reviews, user communities, search and purchase behavior to ensure that whenever you connect with customers, your interactions are relevant and actionable.

Create a mix of the right solutions: As retailers compete for the dollars of more thrifty shoppers, they need the best possible tools for giving customers the information they need when they’re making buying decisions. For example, can you gather information from search and other applications, such as customer ratings and reviews or user communities, to decide what you should be selling to customers and to assist with marketing efforts?

Test your marketing: Test promotions based on the demographic, geographic and other data you’ve compiled to determine what is working and what is not. You can then further refine your strategies to make sure you’re implementing the most targeted campaigns.

If you don’t know what customers are doing when they visit your online storefront, you miss opportunities to capture critical information that can help with future marketing efforts. In all likelihood, you’re already using technologies to promote your products and services. Culling data from those tools and sharing the data across applications can mean the difference between convincing customers to purchase your products and prompting them to look elsewhere.
Shaun Ryan is CEO of SLI Systems in Cupertino, Calif. He can be reached at (866) 240-2812.

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