retail clv is the new black
TRANSCRIPT
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The New Black in Retail: CLV Matt Williamson, CEO, Windsor Circle Mary Cooney, AVP, eCommerce, L’Oreal
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Introductions
Mary Cooney AVP Commerce
L’Oreal
Matt Williamson CEO
Windsor Circle
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By the end of this session, you will know… • How to Calculate Your CLV • How Retention Rates, CLV, and AOV Interact • 4 Steps Required to Grow CLV • Innovation is Putting Marketers in Control
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Use Your CLV Field Manual!
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Agenda • The New Black in Retail: CLV • 4 Steps Required to Increase CLV • Real Life Examples from L’Oreal • 9 Pillars of Retention Automation
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The New Black in Retail: CLV
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Customer Lifetime Value (CLV) is defined as the total dollars flowing
from a customer over the entire relationship with that customer
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Simple Math
Purchase Assumed AOV
Assumed CLV
1 81 81
2 81 162
3 81 243
4 81 324
5 81 405
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What Actually Happens
Purchase Actual AOV
Actual CLV
1 81 81
2 86 167
3 85 252
4 101 353
5 104 457
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This segment has been built and will be available in Salesforce within approximately 24 hours.
This segment has been built and will be available in Salesforce within approximately 24 hours.
This segment has been built and will be available in Salesforce within approximately 24 hours.
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This is how AOV rises with Retention
The Natural State of the Happy Customer
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Existing Customers Are a Huge Source of Competitive Advantage
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If You’re Not Driving CLV and Retention, You’re Losing
• The State of Retailing Online 2015 (by NRF) • AOV for repeat customers - $199 • % of sales from repeat customers - 61%
• Leading Retention Rates: • Bonobos – 50% (via NY Times) • Zappos – 75% (via econsultancy) • Amazon – upwards of 90%
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Ok… But How do I Increase CLV? 4 Phases to Increase CLV Using Data (** Demand This of Your Technology Vendors **)
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1. Knowledge
Begin with the End in Mind (Work Backwards from End Goals)
1. CLV, RetenQon Rates, Share of Wallet
2. What Campaigns Should I Run? 3. What Do I Need to Know? 4. What Data Do I Need? 5. Where Do I Get It?
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2. Data
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3. Science
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4. AutomaQon
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Knowledge
Science
AutomaQon
Data
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#Winning Through Technology How Mary Is Using Technology to Increase CLV and Win at L’Oreal
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• Add image of email
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Valuable Data Fields • CLV (# of dollars) • Recency (most recent order) • Frequency (# of orders) • First order date • Purchase history, by:
• Product • SKU • Store • Category • Interest
• Last Purchase (same) • Address: city, state, zip • Predictive:
• Replenishment • Recommendations
• Substitutes • Complements
• Churn Dates • Custom Fields
• Loyalty Number • Birthday • Skin Type / Color
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What’s Planned – Marketer is in Control • Predictive Data Science
• Replenishment Dates • Churn Date
• Cross-Sell Hair Styling <> Hair Care • Product Recommendations
• Substitutes • Complements
• Reward Best Customers
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This Ain’t Your Mother’s CRM Technology has shifted the playing field. You can do this better, faster, cheaper.
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The Old Way • Hard to reach • Expensive • Untrusted • Monopoly Breeds Complacence • Non-responsive • They are in control
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The New Way • Drivers Compete for Ratings
• Friendly • Responsive
• Convenient • To Find • To Pay • To Rate
• Data Drives Better Experience
• You Are In Control
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#Freedom
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“5 vendors were brought in. No one had the offering that Windsor Circle had. The other vendors had people but they did not have the technology”
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Old School Vs. New Style Old School New Style
Cost $100K -‐ $10M Capital Expenditure
$10K -‐ $500K SoYware SubscripQon
Time 1-‐3 years Weeks -‐ months
Ownership IT
MarkeQng
Skillset Data ScienQst, Programmer
Marketer, Strategist
Data Science Data ScienQsts Technology Pla]orm
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• Game has changed • CLV is the New Black • Technology has put the marketer in
control • #Start, #Test, #Scale, #Win
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Questions?
Visit us at booth #120
@M_D_Williamson
Windsorcircle.com
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