March 7, 2013, 9:54 AM

How Build.com constructs a long view of its customers

The retailer segments customers by lifetime value to improve returns.

Lead Photo

Brandon Proctor

Web-only home improvement retailer Build.com Inc. blends data about how site visitors behave and purchase over two- to four-month periods to determine which ones will generate the most revenue in the long run, says Brandon Proctor, vice president of marketing. That’s shown the retailer that some expensive ad campaigns targeted at frequent customers might generate a loss in the short term but eventually will lead to significant lifetime sales, he says. Now Build.com redirects some of the marketing budget previously aimed at lower-value customers to the high long-term spenders, he says.

That’s paid off in higher revenue, though he declines to provide details.

“We know down the road it's profitable,” Proctor says, adding that the proof comes from the analytics technology Build.com uses. It collects and analyzes customer data with Adobe System Inc.'s SiteCatalyst tool, part of the Adobe Marketing Cloud platform, to divide shoppers into high- and low-value segments, among other groups, for ad targeting.

For example, Build.com recently tested a campaign asking select site visitors—those for whom it did not already have an e-mail address—to sign up for its e-mails when they first arrive, Proctor says. The retailer knew that customers who receive its newsletter tend to make more purchases and spend more on average than other customers. Immediately, the e-retailer’s e-mail list size grew by 0.5%, a significant amount for a large list, he says. “We thought it would hurt us,” he says, because asking customers for their e-mail addresses as soon as they come to the site seemed potentially obtrusive.

Build.com is No. 81 in the Internet Retailer Top 500 Guide.

Testing is at the base of everything Build.com does, Proctor says. About 200 of the retailer's 400-person staff log into Adobe SiteCatalyst every day to test business decisions in all areas, including operations and merchandising, he says.

Soon those disparate business departments will be able to work together and share the reports they generate from Build.com's data more easily, from within the application rather than by sharing spreadsheets or other documents by e-mail. Adobe yesterday announced it is rolling out a new version of its Marketing Cloud, which is based on connecting the vendor's five flagship products—for analytics, content creation and management, targeting, social media and ad spending—into a single dashboard.

Adobe also is updating each of those products with additional features in the coming months, particularly focused on new capabilities for mobile and social marketing, analytics and app development, Adobe says. A quarter of the analytics data Adobe collects each quarter now come from mobile devices, says Brad Rencher, senior vice president and general manager, digital marketing, at Adobe. Adobe announced the news this week during its annual digital marketing conference, taking place in Salt Lake City, UT.

The Marketing Cloud's new interface resembles the Pinterest social network. The main page is a central feed of images, akin to Pinterest pins, representing parts of various projects, perhaps marketing content, like an ad, or updates from analytics reports, like a thumbnail of a graph showing conversions for a campaign.

Newly changed or added images in the feed are labeled with a blue "new" tag to attract a user's attention. Clicking one of the "pins" takes a staffer to the main page, akin to a Pinterest board, for that project. Any collaborator on that project can see, comment and add to the board and its pins. Tools for Adobe's Cloud Products are in menus on the side of the feed.

With that setup, for example, a designer can create a video advertisement and share it with a marketer on the project board for that ad campaign. The marketer can approve it and share it with an analytics staffer for testing, then hand it off to a media buyer who makes it live. The whole process takes place within the Marketing Cloud dashboard through sharing and comments—no e-mail needed—and can be completed within minutes, so long as all involved staffers are logged in. They need not be at their desks, though, as the software works on an iPad, Adobe says.

The new user interface for the Marketing Cloud will roll out to all Adobe customers this summer, the company says. Some new product features are available now, such as the ability to preview how content looks on mobile device screens of various sizes, and the rest will become available in the coming months, it says.

Adobe ranks highest among all vendors in Internet Retailer’s Leading Vendors to the Top 1000 E-Retailers Guide based on the total value of retail e-commerce sales related to all of its client engagements. It’s also No. 1 in the web analytics category.

 

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