Personalization Pioneers Summit 2017September 5th, Soho House Berlin

Personalization Pioneers Summit 2017

Crafting a Culture of Experimentation

Ben Ludigs, Chief Revenue Officer

Introduction to Lamoda

Organizational StructureWho drives Personalization

Who drives PERSONALIZATION

Marketing Onsite Purchasing

Personalization /Merchandising

Who drives PERSONALIZATION§ We placed the team right in the middle of the customer side and the

stock side of the business in order to be able to efficiently balance customer and business needs

§ This setup allows us to use a wide array of expertise from multiple areas in order to fulfill our business goals

§ Our merchandisers understand drivers and levers in marketing as well as have an extensive knowledge of our merchandise on stock, and are actively taking part in business planning

§ Dynamic Yield enables us to to steer the business in a very flexible and quick way and we are able to adjust to execute merchandising decisions in a very non-intrusive, personalized way

Workflows and PrinciplesHow we work

Scale and Relevancy

§ High volume, high frequency testing of ideas, mainly based on shallow KPIs

§ You need to develop a content strategy in order to have enough engaging content and variations to show to customers

§ Comparable to contextual marketing in search and social

§ Most of the time you do not know why it failed, so iterate quickly and often

§ Based on hypotheses that are grounded in user research or business knowledge

§ Choosing specific areas throughout the customer journey where we want to influence the customer

§ Mostly based on deeper KPIs

Scale Relevancy

Relevancy – Use Case

Structure by the purpose of visit

49% 47% 47% 49% 43% 48%

20% 20% 20% 17% 23% 19%

23% 26% 25% 25% 26% 25%

Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17

browsearound

findnewsabouttrends/ideasformylook

purchasesmth.specific

Hypotheses and target

§ Improving specific purchase intend group

presents the biggest lever

§ We can try to identify this group by onsite

behavior rather easy (catalogue & search use)

§ We can increase their satisfaction and CR by personalizing the customer journey

§ We can further try to upsell these customers

§ KPIs: CR, Revenue per Visit, Repurchase Rate

Structure by the purpose of visit Hypotheses and target

Relevancy – Use Case§ E.g.: User has searched specific

item, added to basket, entered first details and is ready to check out

§ Show him a very opportunistic, time limited offer to increase

§ Select the right micro-moment for each communication via testing not to hurt shallow KPIs like conversion rate

§ Create a hierarchy of overlapping campaigns based on your most important KPIs

Relevancy – Use Case

-800-600-400-200

0200400600800

1000

1 2 3 4 5 6< 500 500 - 1,000 > 1,000

Net Lifetime Value depending of first purchase Hypotheses and target

§ First order should be above 500 RUB in order to

break even a customer§ We could identify customers who are most likely

to check out below that

§ Lets try to upsell them§ KPIs: CR, First order Basket, LTV

Cumulated profit after ‘n’ orders Hypotheses and target

Relevancy – Use Case§ E.g.: User is ready to check out,

though has a very low basket value that is most likely not profitable

§ Try to upsell the user with personalized offers or discounts, driving him to a higher profitability bracket

§ Select the right micro-moment for each communication via testing not to hurt shallow KPIs like conversion rate

§ Dig deep on drivers of the KPI and find new solutions spanning across the full customer journey that you can control

Would you like me to add a 2nd size to your basket free of charge

Hi Ori, I am your Shopping Assistant

Yes No …

Mistakes we came across§ Clearly define the KPIs you try to influence with each test beforehand

§ Balance the view on shallow and deep KPIs

§ Be aware of other things going on in your business that might impact your results

§ Align your goals across the business and inform potentially stakeholder early on

§ Make sure you can trust your tools

§ Do not optimize based on temporary restrictions in your business but rather make small steps in the right direction

§ You need to think about content creation in parallel in order to be able to have enough ammunition for personalization