- Certona

Client Success | Soft Surroundings
Using Certona's Geotargeting Recommendations,
Soft Surroundings Sold Excess Inventory 33% Faster.
Executive Summary
Soft Surroundings had some end of season excess merchandise that it wanted to sell sooner
rather than later.
Certona provided geotargeting based recommendations biased by a list of the items that Soft
Surroundings needed to sell.
Certona’s geotargeting based recommendations converted 4% higher than Certona
recommendations alone. Dollars per recommendation for Certona’s geotargeting based
recommendations were also 5% higher than Certona recommendations alone. In addition,
Soft Surroundings’ excess inventory sold at a 33% higher rate than in the past.
Soft Surroundings, founded in 1999 and
based in St. Louis, Mo., is a domestic
multi-channel retailer focused on
high-quality, fashionable women’s
apparel, bedding and home decor, and
top-brand beauty products and
solutions. Soft Surroundings designs
the majority of their fashion and home
merchandise right in St. Louis. Through
its quality product offerings, the
company strives to help customers look
and feel their best.
The company sent out 45 million
catalogs in 2011 and has two websites:
SoftSurroundings.com and
SoftSurroundingsOutlet.com. In addition
to being a leader in the catalog and
online markets, Soft Surroundings is
expanding their retail presence with 10
stores total planned by the end of 2012.
CERTONA IS A TRUE
BUSINESS PARTNER THAT
ACTS WITH OUR INTERESTS IN
MIND. THEIR TEAM PROACTIVELY SUGGESTS NEW
STRATEGIES THAT CONSIS-
Objective
Replace Manual Recommendations with an Automatic Platform that Would
Yield to Business Rules
Certona was chosen to help Soft Surroundings address many challenges and improve
the overall shopping experience with meaningful and relevant recommendations. “We
chose Certona for two important reasons,” said Ellen Gooch, Senior eCommerce Analyst
at Soft Surroundings. First, they were very transparent with all their information, and
second, they have an amazing ability to test anything.”
TENTLY PROVE TO GROW OUR
KEY METRICS AND TOP LINE
REVENUE.
ELLEN GOOCH, SR. ECOMMERCE ANALYST
Client Success | Soft Surroundings
Soft Surroundings added Certona’s recommendations across its Product Detail Page, No Search Results Page,
Shopping Cart and Emails. With Certona, Soft Surroundings was able to leverage the automation of its
merchandising technology and test its flexibility against its traditional manual approach.
A Partnership is Built
Implementing personalized recommendations generated immediate results for Soft Surroundings. Acting as a
trusted business partner over the years, Certona has continued to advise Soft Surroundings on industry best
practices that yield the highest customer engagement and conversion rates for its recommendation strategies.
A New Objective
Liquidate Excess Inventory Quickly and Cost Effectively
For various reasons, Soft Surrounding sometimes has excess inventory that it would prefer to liquidate via its
outlet website. Other liquidation methods like sale catalogs and sale inserts take time and money to get to
production and selling off merchandise to jobbers can be quite costly. “We have excess inventory or end of
season products that we want to liquidate online,” said Anne Klouzek, Liquidation Manager who runs
SoftSurroundingsOutlet.com. “Our challenge is to deplete our excess inventory, at the highest possible cost
recovery, while still delivering a personalized, online experience for every single Soft Surroundings customer.”
From its vast catalog, Soft Surroundings wanted to provide all of its Outlet customers with compelling,
personalized recommendations that were tailored to their specific interests and geotargeting preferences. At the
same time, the company was seeking to sell its excess inventory. The challenge was for Certona to correlate
these two seemingly different objectives into a personalization strategy that would achieve both goals while
minimizing the technical resources required to execute.
Solution
Geotargeting vs. Merchandise List
Stepping up to the challenge, Certona helped Soft Surroundings develop a customized test of two different
strategy progressions, each designed just for Soft Surroundings to determine which set of strategy progressions
worked better than what was currently in place (Control).
The first test strategy progression was to use a merchandise list to determine which products were going to be
recommended. This is what most traditional retailers do.
The second strategy progression was to leverage Certona’s out of the box strategies coupled with Certona’s
geotargeting services and the ability to bias items that sold well in the same region as the current shopper.
Analytically Develop The Right Geographical Segments
The first step of Certona’s recommended solution was to determine the right geographical regions for Soft
Surroundings to segment. Working together, Certona’s in-house analytics team determined that the right
segmentation for Soft Surroundings was five latitudes (See graphic).
These five geographical segmentations directly corresponded with the seasonal changes of winter to spring. For
those winter items Soft Surroundings needed to deplete, Certona added a bias to those items aligned with the
geo-location. For those shoppers in the colder regions, these winter items would be recommended more
frequently than those shoppers in the warmer regions.
Simply put, geotargeting and item bias were combined to accelerate the inventory depletion Soft Surroundings
required while maintaining shoppers’ personalized recommendations, thus enhancing the customer experience.
For performance comparison, a control group within each of the geo-locations was created.
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Client Success | Soft Surroundings
Create Regional Biases Based Upon Recent Sales
The next step was to create biases for these regions based upon past recent sales in those regions. Then, using
“when” rules from within Certona’s Insight console, the right biases were applied to the right strategy
progression.
The use of geotargeting and biases in this way allows Certona to provide the right recommendations for
customers in a particular location. For example, shoppers in the southern part of the US may not be as
interested in buying winter coats in the spring, but shoppers in the north where weather was still chilly might be.
Results
Geotargeting Results in a 4% Conversion Increase
The test of Control (Certona standard recommendations: without biases) versus Merchandise List (Merch List)
versus Geotargeting Biases (Geo Bias) ran from February to early April. Upon reviewing the implementation of
Certona’s Geotargeting based Product Recommendations, SoftSurroundingsOutlet.com saw a significant 4%
increase in both conversion rates and item revenue per recommendation.
4% increase
in conversion rates and revenue per recomendation
10% more
items than control
90% more
items than the merchandise list alone
Soft Surroundings also saw that Geotargeting Biases sold 10% more items than Control and 90% more items
than the merchandise list alone.
“We can see that we have a great ROI right now,” Klouzek said. “We know that our conversion rate is improved
overall, but for those who click on geotargeting based recommendations, it’s much stronger.”
Learn how your company can personalize anytime, anywhere.
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[email protected]
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certona.com
Client Success |
Soft Surroundings
Part 2: Objective
Combine Geotargeting with the Must-Sell List
From the results above Soft Surroundings declared Geo Bias the winner and made that its default strategy on its
Soft Surrounding Outlet site product page. However, the modest lift in the sales of overstock items between the
control and geo bias was not enough. Soft Surroundings wanted more. Upon review, Certona proposed another
round of testing.
Solution
This time Certona proposed that Geo Bias, the new Control, would test against a new geo bias that only biased
the items that Soft Surroundings wanted to sell.
Results
Inventory is Depleted 12.4% More than the Control Group
The test of Geotargeting Biases (Geo Bias Control) versus Geotargeting Merchandise Biases (Geo Merch) took
place in April and May. With the new Geo Merch strategies that combined geo biasing specific items for the geo
regions, inventory was depleted 12.4% more than the Geo Bias Control and delivered slightly higher margins.
Soft Surroundings also saw that Geotargeting Merchandise Biases sold 37% more items than Geotargeting
Biases (Control).
12.4% more
37% more
than the Geo Bias Control
items than Geotargeting Biases
Highly Flexible Recommendations Platform
Now Soft Surroundings has more levers than it ever have had before. If driving revenue is important, then Soft
Surroundings knows that it can improve that with Geotargeting Biases. If selling overstock items is more
important, Soft Surroundings knows that it can depend on Geotargeting Merchandise Biases.
Summary
A True Partnership Leads to Outstanding Results
Among Certona’s impressive roster of clients, Soft Surroundings stands out as being innovative and eager to
explore new methods to best promote its catalog. Building on past successes, it again turned to Certona’s
personalization experts by working in tandem to determine and set new merchandising goals that took into account
geotargeting and excess inventory while still maintaining a personalized shopping experience for its customers.
This collaboration between both teams provided true clarity in the marketing objectives and accelerated Certona to
develop the right approach that would result in the most accurate testing environment. By leveraging Certona’s
flexible merchandising capabilities and applying geotargeting into its new personalization strategies, Soft
Surroundings achieved a combined success that satisfied its inventory goals and provided lift for its bottom line.
“Certona is a true business partner that acts with our interests in mind. Their team proactively suggests new
strategies that consistently prove to grow our key metrics and top line revenue,” Gooch said. “The beauty about
Certona is... it lets us easily say: Why don’t we just test it!”
Learn how your company can personalize anytime, anywhere.
858.369.3888
|
[email protected]
|
certona.com