Make Every Hit Count

If you've shopped online for items like gardening tools, housewares, and children's toys, you might know www.lillianvernon.com. Your mother, on the other hand, has probably ordered something from one of Lillian Vernon's (Rye, NY) eight mail-order catalog titles. But chances are fair that you didn't know the Lillian Vernon mail-order catalog still exists, while the Internet is brand-new shopping ground for dear old mom. This new sales venue poses a challenge for a 50-year-old mail-order retailer that's been an e-commerce pioneer since its storefront launched on AOL in 1995. When you add a high-tech sales channel such as the Internet to sell products to a wide demographic, how do you know who's buying what, where, how often, and why?

Lillian Vernon mails 169 million copies of its eight catalog titles each year, operates 15 outlet stores in five states, and last year generated 9% of its orders online (to the tune of $22 million). Anticipating e-commerce growth, the company decided to get sophisticated about identifying its online constituency.

"We needed a solution that would let us measure our online channel as effectively as we measure our catalogs," said Lillian Vernon, who founded the mail-order company in 1951. "Our catalog metrics give us information to support business decisions. We need the same kind of intelligence for our online business to create a clearer understanding of our customers across all channels."

Drill Down To Determine Demand
Lillian Vernon teamed with Buystream (San Francisco) to provide an ASP (application service provider)-modeled business metrics system for its Web site using Buystream's Merchant 3.0 with Cognos PowerPlay. Buystream's Merchant 3.0 is an e-business analytics and reporting solution that uses data-tag technology. This gives Lillian Vernon a constant flow of timely data about its online customers by recording site activity as it happens. Lillian Vernon's marketers now pay Buystream a monthly fee to pull reports from this up-to-the-minute information, which includes the demographics of users logging on to the site, which products shoppers are searching for, and which items customers are buying. This data helps Lillian Vernon make merchandising and marketing decisions in response to immediate customer demand. "Our goal is to pinpoint customer behavior when they visit our Web site, particularly their navigation patterns," said David Hochberg, VP of public affairs at Lillian Vernon. "Buystream's Merchant gives us the opportunity to develop targeted marketing campaigns in order to drive sales and grow our Web business."

Bundled with Merchant is Cognos PowerPlay, an OLAP (online analytical processing) "data cube" that allows Lillian Vernon to customize its queries. The cube displays multi-dimensional views of interaction between different elements of Lillian Vernon's e-tail business. With PowerPlay the company can simultaneously correlate the site's busiest hour with the users who visit during that hour, their average order size, and the most popular products purchased. Drilling down gives Lillian Vernon the ability to target marketing efforts to specific customer groups.

Certainly, two channels of the same company don't exist in their respective vacuums. Rather, they are often cross-promoted to maximize the impact of each other. Buystream software's open SQL (structured query language) architecture will allow Lillian Vernon to integrate its Web site data with its store and catalog data for a comprehensive and simultaneous view of all its channels.

Turn Clicks Into Actionable Data
Most Web sites without an online metrics solution rely on log data for tracking online visitors. This means of data collection presents a problem if a Web site features a constantly changing or interactive design, where customers can pick and choose from various menus, as in the case of www.lillianvernon.com and most other e-tail sites. Log files will record the page a user is viewing, but they will not record the specific content that is pulled from a database or other external source when the customer clicks on a certain page. While log data might tell Lillian Vernon that its gardening page had 12 hits today, the retailer might not know instantly how many of those 12 hits translated into the sale of a plant stand, or how many people bought matching terra-cotta flower pots, too.

Buystream's data-tag approach cannot only provide a comprehensive look at a retailer's data, it can process it and translate it into actionable information. Now, Lillian Vernon knows that its painted flower buckets are selling with the plant stand more often than the terra-cotta pots. The company's merchandising department can capitalize on this knowledge by placing the plant stand adjacent to the flower buckets, rather than the terra-cotta pots, on its Web site. Lillian Vernon is analyzing the newfound data collected from its online metrics program as it prepares for a site redesign this fall. Based on its satisfaction with Merchant 3.0, the company is now considering an upgrade to Buystream's latest release, Merchant 3.5. This latest version of Merchant adds even more specific shopping cart abandonment information than version 3.0 and enhanced internal search capabilities that give the e-tailer a deeper look at customer patterns. Lillian Vernon has put a lot of effort into getting to know its customers, both online and offline. One day, your mom might take the challenge and, with a little help, go shopping at www.lillianvernon.com. When she does, it's a safe bet that Lillian will be watching her every click.