Schwans.com increases site personalization and sees conversions rise
When it relaunched in January 2002, Schwans.com, the online, B2C arm of the $4 billion Schwan Food Co., incorporated personalization applications from technology vendor E.Piphany, betting that it would see a sales lift as a result. It did – though not exactly in the way it had anticipated, Glenn Bader, the director of Internet and advanced technology marketing tells Internet Retailer.
CRM efforts are long in development at 51-year-old Schwan’s which, in addition to manufacturing frozen foods for institutional distribution and also under grocery store brands such as Red Baron Pizza, also provides home delivery of premium frozen foods and meal solutions to individual households in 48 states. Home customers can order by phone, from their Schwan`s route rep, or, since 1999, on the web.
Schwan’s has proprietary technology supporting its CRM initiatives across channels and also uses CRM applications from E.Piphany for customer segmentation, launching e-mail campaigns, and operating a multi-campaign management interface. Schwans.com first added personalization last year with the help of E.Piphany tools. "We thought that we would look at what was in customers` carts at checkout, and based on that, suggest other items at checkout to complement the order. We made some assumptions that there would be a certain take rate on those offers and that it would generate a certain amount of increased sales to offset our investment," Bader says.
To test the concept, Bader’s team added personalization to several areas of the site: the piece at checkout, recommended products customers might like based on their past behavior, and offers when customers first logged in that were selected for presentation from all available offers based on relevancy to the individual customer. It also built a control group of site customers who didn`t get the personalized experience.
After six months, Bader says, the sales uptick among customers who got the personalized experience covered Schwan’s investment in personalization – but in an unexpected way. "We found our planning assumptions were off," he says. "We didn’t get the take rate we thought we would on the items offered at checkout. But what we found was that of all customers that came to the site, those who had the personalized experience had a higher conversion rate, were more likely to order, and when they ordered, spent more. Also, they came back more often and purchased again. So when we put all of that together, it more than paid for our investment."
Bader says that even though the benefits realized through personalization on the site were slightly different than expected, it`s still the element of relevancy that produced those benefits. "The site content was more relevant to customers, which caused them when they visited to be more likely to order. And when they liked what they ordered, they came back to the site more often. We believe it was the relevancy of the experience that generated the increased sales," he says.
Since its initial experiment, Schwans.com has greatly increased personalization with another site relaunch in April. "We took the learning from the 2002 personalization launch and ingrained it throughout the whole web experience," Bader says. "On the old site I could say, here are the few areas that are personalized. With the new site, it’s easier to say, here are the few areas that aren’t personalized."
Bader adds that he`s still monitoring the effects of increased personalization on the new site, but an initial review shows a 30% increase in online conversions, based on an A/B test, since the new site was launched, with greater personalization, in April. "Part of that it is that the site looks new and different," says Bader. "Part of it is the personalization."
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