Is a 2% conversion rate really good enough?

Posted in Retail
By Kerry Liu on August 8, 2014

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Why do online retailers accept 2% conversion rates as “good enough?”

How do large offline retailers properly understand their customers across multiple channels and actually innovate their way out of this retail war?

How can they increase their conversion rates without spending millions more on paid search alone? This endless cycle of invest $100 in search to earn $110 has to stop.

These are some of the questions we consider on a daily basis with our customers, in our product meetings, and in our engineering meetings.  To answer these questions, Rubikloud is building the world’s most advanced retail intelligence platform. We don’t believe in point solutions that just focus on one aspect of the retailer (i.e price). It’s all about integrated metrics.

So what does retail intelligence mean to us? We divide every retailer’s business into four categories:

  1. Marketing Intelligence

Understanding how to optimize your online and offline marketing budget to maximize conversion.

  1. Customer Intelligence

Truly understanding customer segments and the value of each segment so you can promote, productize, and market to the applicable segments.

  1. Pricing & Promotion Intelligence

Given your business constraints, how do you optimize price or promotions?

  1. Integrated Intelligence

Most importantly, whenever one of these levers change, how does it affect everything else?

I know these are abstract concepts, but the reality is we help customers understand areas like attribution, price sensitivity, product basket analysis, customer lifetime value, and customer segmentation – ALL IN ONE PLACE!

You can only do this when ingesting multiple sources of data. This is only possible when your advanced machine learning models take into account all of the different scenarios and decisions a customer could make, and has made historically.

Our whole premise is that analytics in silos no longer make sense. If that premise is generally accepted, then why do retailers still want to buy data science solutions in silos? Why buy a pricing sensitivity tool, lifetime value tool, and customer segmentation tool? Stop buying tools and start looking at platforms. The difference between Adobe and Salesforce is simple. Adobe is a suite of products and features. Salesforce is an integrated platform.

Enough is enough with these 2% conversion rates. It’s time to integrate your data and look at your retail business in one system.