How Ice.com maintains high conversion rates with higher-priced offers

With a new e-mail marketing program that lets it track the response of individual recipients to specific e-mail promotions, Ice.com increased the average price offered in holiday season 2006 promotions by about 33% and maintained 4% conversion rates, marketing database manager Henry Shih tells InternetRetaieler.com.

“We did some tests leading up to Christmas and found that our customers were pretty receptive to higher-priced promotions in e-mail newsletters,” Shih says. While the average price in Christmas 2006 promotions was about $200, up from a prior average of about $150, Ice maintained its usually high holiday season conversion rate of about 4%, he says.

Shih attributes the ability to convert with higher prices to a new e-mail marketing management software program that Ice deployed last year from Lyris Technologies Inc., a unit of J.L. Halsey Corp. The Lyris ListManager program, which Ice deployed about this time last year, enables the retailer to test multiple e-mail promotions and creative copy as well as test responses to specific promotional campaigns by individual customers. “I can tell if an individual person bought an item from this promotion, and I can tell right down to which e-mail the customer responded to,” Shih says, adding that Lyris makes this possible by providing a tracking code for each e-mail to each customer.

To produce the same data before using the Lyris program, Ice would have had to develop extensive software coding to track e-mails—and then only get down to segments of customers, not individuals, Shih says.

The Lyris program also integrates with Ice.com’s in-house web analytics software, enabling Ice to configure personalized e-mail promotions based on customers’ past shopping behavior. A registered customer with a history of buying or browsing for diamonds, for example, might receive a personally addressed e-mail newsletter offering a promotion on diamond jewelry. The Lyris ListManager program also offers a web analytics module, though Ice has instead continued to use its in-house analytics software.

Ice.com, No. 193 in the Internet Retailer Top 500 Guide, has also used the Lyris program to determine more effective combinations of e-mail promotional message content and web site landing pages. For example, it tested two groups of e-mail promotional messages: the first version, which mentioned only a general category of products, sent customers to a web site landing page with a group of individual products listed with images and details; the second version, which showed the same group of products with images and details in the e-mail message, let customers click any product image to go to a landing page specifically for that product.

The first version produced higher click-through rates, apparently because shoppers wanted more product details, but the second version had a higher rate of converting click-throughs to sales, Shih says. In effect, the second version saved shoppers a step to get to a product buy page. “We learned that having a lot of products in the e-mail newsletter message actually helps increase sales more,” Shih says.

Ice.com’s Pinny Gniwisch, will speak at the Internet Retailer Conference & Exhibition, June 4-7 in San Jose in a workshop session entitled New Age Marketing Tools: Is Today`s Hype Tomorrow`s Help?

Ice.com also owns and operates Diamond.com.