How big data propels The Children’s Place online and off

May 10, 2013 10:48 AM

Eight of the ten fastest-growing merchants listed in the Top 500 Guide rankings for the last 10 years are retail chains. And competing with web-only rivals like Inc. for the last decade was no small task for The Children’s Place, says its vice president of e-commerce, Michael Dupuis. He says part of what helped the company survive and flourish online was that it had the foresight and wherewithal to take advantage of new technologies.

“It used to be said that if you’re not a technology company, you shouldn’t attempt to be one,” he says. “But omnichannel retailers nowadays have to be both technology companies and data analytics companies to beat the competition.”

In the last two or three years, for example, The Children’s Place has been looking to take advantage of the increasing amounts of information it has about who its customers are, what they are buying, when and in which channel. Some call analyzing this growing mass of consumer information “big data.”

In the last two or three years, the merchant has linked up its e-commerce platform with its customer relationship management system and loyalty programs so that it can better understand its customers, DuPuis says.

The Children’s Place, No. 112 in the new Internet Retailer Top 500 Guide, can now analyze such key metrics as web site visit frequency, and purchase frequency, size, and channel, to determine what certain customers or customer segments respond to.

For instance, Children’s Place can track Jane Shopper when she buys a red boys T-shirt in a store and swipes her loyalty card, then follow her onto the web three days later when she signs in with her user name and password to write a review of the T-shirt. The merchant also knows that she browses other colors of the same T-shirt for about five minutes, but then decides to purchase a pair of jeans that match. Children’s Place can combine the data on all of those interactions, compare them to other shoppers’ behaviors and not only figure out how to market to Jane more effectively, but also to customers that behave online and in stores in similar ways.

“We now have one single real-time view of the customer inside of a database,” he says. “We can take groups of customers that are particularly valuable to us and figure out how to achieve the highest likelihood of conversion. This is enormously valuable as far as sourcing new customers, allocating marketing dollars and figuring out how to deliver campaigns that ultimately speak to customers in a way that works, and driving more out of each one.”

The Children’s Place has gone from generating around 1% of total sales, or about $5.1 million, from e-commerce in 2003 to nearly 12%, or $215.0 million, in 2012. That’s more than 4,000% growth in online sales over the last decade. Investors have been impressed by the retailer’s overall performance, as the stock price—about $11.50 a decade ago—is around $48 today.

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