The acquisition will add more than 300 products to L’Oreal’s lineup.
The company tested out a personalization system recently on its e-commerce site and the return on investment was too strong to ignore. So the e-retailer added the system to its site permanently.
E-retailer Computer Geeks does exactly what many business schools will tell aspiring entrepreneurs not to-it competes almost solely on price. Therefore, the discount retailer of computer and consumer electronics operates with few frills so that it can pass more savings on to consumers. But when the company recently tested a personalization system on its e-commerce site, Peter Green, director of marketing, says the return on investment was too strong to ignore. And so, the e-retailer added the system to its site permanently.
“We try to keep the price for our products at an absolute minimum, so it has to really make sense for us to implement a technology,” Green says. “But it really helped drive conversions.”
The hosted system from Sitebrand Inc. took one to two weeks to implement and allows Computer Geeks to speak to visitors differently based on their behavior. Sitebrand worked with Computer Geeks to divvy up visitors into the following segments: first-time visitors, past purchasers, users who had visited specific sections of the site, shoppers from specific geographic locations and visitors who have spent longer than average on the site or looked at many pages and not purchased. The vendor then helped Computer Geeks decide how it would target each group differently.
For example, Green says, consumers who browse for a while without buying will see discounts or promotions. A user that has viewed many pages in a short amount of time might see a list of new products to pique their interest.
“For consumers who seem lost, we thought, ‘Why don’t we show them what we think is coolest?’” Green says.
The program increased sales 9% on average, or $540,000, in a two-month period, Green says.
Green says Computer Geeks’ marketers can easily change ads or promotions via a dashboard that lets them upload new content. “There are some months we don’t touch it because we are busy with other things. Other times we will look at a campaign and see it’s not performing up to expectations and we will change it.” The system also allows Computer Geeks to test different ads for the same target audience, Green says.
The cost of the system is based on number of page views per month. Computer Geeks has a monthly personalized page-view budget, Green says, but he did not disclose it.
“We were skeptical at first, but they gave us a free trial and they really worked with us, gave us a lot of hand-holding and insight into their system and how it works with our analytics,” Greens says. Computer Geeks uses an analytics package from Corermetrics.
About 60,000 visitors trek to Computer Geeks each day, and the e-retailer’s average order size ranges between $105 and $130 depending on the time of year, Green says. The e-retailer’s 2007 web sales totaled $59.22 million. Computer Geeks is No. 174 in the Internet Retailer Top 500 Guide