Customer database key to figuring multi-channel P&L, Discovery says
Figuring profit and loss numbers separately for online, store and catalog channels is one thing, but it can be more valuable—and more challenging—to figure P&L across all channels, Kelly Day, senior vice president for Discovery Communications Inc.’s Discovery Interactive, said at the Shop.org Annual Summit this week.
“Store P&L, e-commerce P&L and catalog P&L don’t address the multi-channel shopper well,” even though multi-channel customers spend the most and are the most profitable, says Day, who was recently named a top executive of Discovery Interactive, a new unit that oversees the company’s Discovery.com e-commerce site as well as the content sites related to its TV channels. Day appeared on a panel presentation, “What Numbers Do Multi-Channel Retailers Look at Each Monday Morning?”
Discovery, No. 195 in the Internet Retailer Top 500 Guide to Retail Web Sites, uses an Acxiom Corp. database that records data from each selling channel, providing information on customer purchasing activity across web, store and catalog, Day says. When Discovery absorbs the cost of publishing a new catalog, for example, it can analyze its customer database to see how it’s likely to impact customers’ multi-channel activity.
Day notes, however, that it can take years to build an effective customer database. “Unless you know where customers have been shopping over years, it’s hard to create a multi-channel P&L,” she says.
Discovery also uses web analytics from Omniture Inc. to check web visitor-to-sales conversion rates as well as data on sales in dollars and units. It reviews data monthly during off-peak seasons, but weekly during peak periods such as November and December. Products found with low conversion rates are flagged for investigation into criteria such as pricing and quality, Day says.
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