Magazine Article | July 20, 2006

Increase Sales, Reduce Advertising Expenses By 25%

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An online retailer gains 10,000 new site visitors within two months and increases conversion rates for retail partners with specialized search criteria.

Integrated Solutions For Retailers, August 2006

As online businesses grow, analytics packages are necessary to sustain that growth. Furniture.com is an online furniture store designed to personalize furniture purchases while providing the convenience of shopping from home. The online store partners with physical furniture retailers, such as Levitz, Leon’s, and RoomStore, to serve certain regions of the country. It introduces shoppers to available furniture at regional stores, enables item searches, and provides the same delivery rates available in the physical stores.

When Furniture.com partnered with one furniture retailer, it received adequate information from its existing analytics package, which created reports, tracked campaigns, and determined users’ geographic locations. However, when the online store established a partnership with a second retailer, it required more statistics and flexibility. To modify its existing package would have been an ongoing and costly process. So, Betsy Harden, Furniture.com’s director of marketing, along with the retailer’s CEO, evaluated enterprise analytics providers and selected products from Omniture — SiteCatalyst and Discover.

“SiteCatalyst accommodates our structure with various retail partners in separate regions,” says Harden. “The tool helps us understand the most profitable paths on our Web site, where customers most frequently drop off [exit the site], and how different segments of visitors interact with the site. It includes a map that provides page flow information, a customized dashboard, and an interface with Excel that enables forecasting models to be created.” Furniture.com uses SiteCatalyst to define geographic locations by ZIP code, which provides consistent reporting with the retailer’s other systems. “The tool provides information about marketing techniques and site structures that are working and those that are not,” says Harden. “We can drill down and get as granular as we want with the data. During the first month of use, we uncovered a merchandise availability issue where the information from one retail partner’s inventory system was not integrating correctly with our site. So, customers saw out-of-stock messages, when the products were really in stock. After resolving that problem, conversion rates immediately increased with that retail partner’s products.”

Additionally, Furniture.com uses SiteCatalyst to track keyword performance by categories (e.g. bedroom furniture and dining sets), by geographic region, and retailer. Using SiteCatalyst, Harden reduced marketing expenses by 25% without affecting sales, by identifying keyword categories that simply failed to deliver strong results. As a result, the online retailer cut its pay-per-click advertising budget. Because of those savings, Harden focused on a new advertising campaign for customers who recently purchased homes. This drew in more than 10,000 new visitors during the first two months she targeted these customers.

Analyze Trends By Region
The Discover tool allows Web data to be segmented into smaller, more meaningful data pools. “We use Discover to analyze purchasing patterns,” says Harden. “We can hone in on products selling well in certain regions or determine  product categories that are the most popular by region. We may find that children’s furniture sells better in southern California than northern regions. The tool helps us understand our customers, so we can apply marketing campaigns in specific regions. When we have ideas about marketing, we use Discover to quickly determine if the idea is worth pursuing.”

By analyzing data in Discover, Harden modified her approach for some marketing campaigns. She’s learned that specific landing pages work better than generic landing pages. Now, when e-mail messages are sent out about certain categories of products (e.g. bedroom furniture), the links in the messages land on specific product pages (e.g. a specific bedroom set) versus generic pages about the category.

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