The New Black in Retail: CLV Matt Williamson, CEO, Windsor Circle Mary Cooney, AVP, eCommerce, L’Oreal

Introductions

Mary Cooney AVP Commerce

L’Oreal

Matt Williamson CEO

Windsor Circle

By the end of this session, you will know… •  How to Calculate Your CLV •  How Retention Rates, CLV, and AOV Interact •  4 Steps Required to Grow CLV •  Innovation is Putting Marketers in Control

Use Your CLV Field Manual!

Agenda •  The New Black in Retail: CLV •  4 Steps Required to Increase CLV •  Real Life Examples from L’Oreal •  9 Pillars of Retention Automation

The New Black in Retail: CLV

Customer Lifetime Value (CLV) is defined as the total dollars flowing

from a customer over the entire relationship with that customer

Simple Math

Purchase  Assumed  AOV  

Assumed  CLV  

1   81   81  

2   81   162  

3   81   243  

4   81   324  

5   81   405  

What Actually Happens

Purchase  Actual  AOV  

Actual  CLV  

1   81   81  

2   86   167  

3   85   252  

4   101   353  

5   104   457  

This segment has been built and will be available in Salesforce within approximately 24 hours.

This segment has been built and will be available in Salesforce within approximately 24 hours.

This segment has been built and will be available in Salesforce within approximately 24 hours.

This is how AOV rises with Retention

The  Natural  State  of  the  Happy  Customer  

Existing Customers Are a Huge Source of Competitive Advantage

If You’re Not Driving CLV and Retention, You’re Losing

•  The State of Retailing Online 2015 (by NRF) •  AOV for repeat customers - $199 •  % of sales from repeat customers - 61%

•  Leading Retention Rates: •  Bonobos – 50% (via NY Times) •  Zappos – 75% (via econsultancy) •  Amazon – upwards of 90%

Ok… But How do I Increase CLV? 4 Phases to Increase CLV Using Data (** Demand This of Your Technology Vendors **)

1.  Knowledge  

Begin  with  the  End  in  Mind  (Work  Backwards  from  End  Goals)  

 1.  CLV,  RetenQon  Rates,  Share  of  Wallet  

2.  What  Campaigns  Should  I  Run?  3.  What  Do  I  Need  to  Know?  4.  What  Data  Do  I  Need?  5.  Where  Do  I  Get  It?  

     

2.  Data  

3.  Science  

4.  AutomaQon  

Knowledge  

Science  

AutomaQon  

Data  

#Winning Through Technology How Mary Is Using Technology to Increase CLV and Win at L’Oreal

•  Add image of email

Valuable Data Fields •  CLV (# of dollars) •  Recency (most recent order) •  Frequency (# of orders) •  First order date •  Purchase history, by:

•  Product •  SKU •  Store •  Category •  Interest

•  Last Purchase (same) •  Address: city, state, zip •  Predictive:

•  Replenishment •  Recommendations

•  Substitutes •  Complements

•  Churn Dates •  Custom Fields

•  Loyalty Number •  Birthday •  Skin Type / Color

What’s Planned – Marketer is in Control •  Predictive Data Science

•  Replenishment Dates •  Churn Date

•  Cross-Sell Hair Styling <> Hair Care •  Product Recommendations

•  Substitutes •  Complements

•  Reward Best Customers

This Ain’t Your Mother’s CRM Technology has shifted the playing field. You can do this better, faster, cheaper.

The Old Way •  Hard to reach •  Expensive •  Untrusted •  Monopoly Breeds Complacence •  Non-responsive •  They are in control

The New Way •  Drivers Compete for Ratings

•  Friendly •  Responsive

•  Convenient •  To Find •  To Pay •  To Rate

•  Data Drives Better Experience

•  You Are In Control

#Freedom

“5 vendors were brought in. No one had the offering that Windsor Circle had. The other vendors had people but they did not have the technology”

Old School Vs. New Style Old  School   New  Style  

Cost   $100K  -­‐  $10M    Capital  Expenditure  

$10K  -­‐  $500K    SoYware  SubscripQon    

Time   1-­‐3  years     Weeks  -­‐  months  

Ownership   IT    

MarkeQng    

Skillset   Data  ScienQst,  Programmer  

Marketer,    Strategist  

Data  Science   Data  ScienQsts   Technology  Pla]orm  

•  Game has changed •  CLV is the New Black •  Technology has put the marketer in

control •  #Start, #Test, #Scale, #Win

Questions?

Visit  us  at  booth  #120    

@M_D_Williamson    

Windsorcircle.com    

Join Us For Dreamforce 2015 September 15-18, 2015 | San Francisco, CA

salesforce.com/dreamforce