July 29, 2010, 12:55 PM

Personalization boosts Karmaloop’s conversion rates

The fashion retailer sends e-mail alerts that reflect consumers’ interests.

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Karmaloop LLC, which sells trendy apparel to younger consumers, has used personalized e-mail alerts and product recommendations to boost long-term conversion rates by 73%, says Anand Shah, chief operating officer for the Boston-based retailer.

About two and half years ago, the retailer began integrating personalization and recommendation technology from vendor MyBuys Inc. into the retailer’s web site and its e-mail marketing campaigns, he says. Features include e-mail marketing messages and web site recommendations that reflect the individual consumer’s purchase and on-site browsing history.

Today, Karmaloop uses those consumer insights to send e-mail alerts that take into account the consumer’s brand and product preferences. For instance, a consumer who signs up for e-mail marketing messages from the retailer might indicate that he is interested in watches, or even a particular brand of watch, such as Nixon.

“When those watches go on sale the consumer will receive an e-mail about it,” Shah says. “The conversion rate is very high because the alert is very specific to the products he might be interested in.”

The retailer, whose customers are heavily focused on specific brands, also tracks what brands, and products, they look at. Repeat web site visitors are greeted with recommendations on the upper right side of the page.

Karmaloop also takes advantage of product review technology from PowerReviews Inc., which works with MyBuys. The technology enables the apparel retailer to insert product ratings in e-mail alerts.

The retailer has been pleasantly surprised by the results.

“We were skeptical about reviews at first because 80% of our SKU base has a shelf life of six to eight months, and it can take time for reviews to come in,” Shah says. “But we saw how effective the reviews are for getting information. It’s an effective social media channel, and it helps us understand what people think of a particular brand.”

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