On the Scene at Jupiter Retailing Forum: Customization Means Conversion

Chicago–“Overhyped and underdelivered” is how Bill Bass, senior vice president of e-commerce and international for Lands’ End, described personalization at the Jupiter Retailing Forum, held May 21 and 22 at the Sheraton Chicago Hotel & Towers. Yet in his May 22 keynote speech, Bass declared that personalized communication—both through targeted e-mail campaigns and diligently tracking consumer preferences and activities across all channels—”will be the most important thing going forward.”

And the $1.51 billion Lands’ End is in a position to know. Sales from its Website, which launched in July 1995, reached $220 million last year, accounting for 16% of the apparel and home goods cataloger’s total sales. What’s more, the company expects Web sales to account for 40% of total revenue for the first quarter of 2001. “If there’s a single key to our success, it’s how we’ve handled multichannel integration,” Bass said. “Our philosophy is that we have one set of customers and they can choose what channel to shop in.”

Lands’ End’s online personalization features include live chat and My Virtual Model, a three-dimensional model built to a customer’s specifications, which can be used to virtually “try on” clothes. And instead of using click-stream analysis to recommend appropriate items for consumers, which may erroneously base recommendations on gift purchases, Lands’ End uses conjoined analysis, in which it asks a consumer to pick the outfits she prefers out of a set of six. “Based on this we can sort through all the SKUs and recommend colors and styles that we think the customer would like,” says Bass.

The payoff? “We have compared pre- and post-shopping behavior of key customers using these tools, and the average order size has increased 10%,” Bass said. “Conversion rates have reached 80%.”

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