As retail pushes further into online spaces, many marketers and merchants alike are focused on clicks and open rates to measure the success of campaigns and consumer outreach, said Matt Williamson, cofounder and CEO of Windsor Circle.
With its Predictive Lifecycle and Marketing Platform, the Durham, N.C.-based company takes a different, data analytics approach to online retail marketing.
“Ask any retailer, any merchant, and they’ll say their most important asset is their customer base,” Williamson said. “But advertising can be a pretty blunt instrument — which isn’t a great consumer experience. So the problem we’re solving for big consumer brands who go direct to consumer is helping them use their data to enhance the brand and the relationship.”
Founded in 2011, Windsor Circle currently serves over 300 clients — including brand names like L’Oreal, Ghirardelli, Lenovo, Skullcandy and Petco division Doctors Fosters and Smith, Williamson said. In 2014, the company won Google’s first Demo Day.
Windsor Circle’s Predictive Lifecycle and Marketing Platform first integrates into a retailer’s existing set of data.
“This allows us to consume the entire purchase history, product catalog and customer record,” Willamson said.“Then our data science layer will begin to make predictions based on that information.”
Once Windsor Circle’s platform analyzes this broad set of merchant data, it then puts the company in a position to create and distribute marketing and advertising campaigns that use highly personalized content.
“Really, it’s about increasing retention rates and the customer lifetime value on average,” Williamson said. “For us, that’s the ultimate arbiter of whether you’re helping a retailer build a sustainable business. Getting to the data, making sense of it and moving it into the right channels are hard problems to solve. We’ve created a platform that solves all three.”
The company’s predictive replenishment automator, for instance, can sort through a merchant’s catalog to identify, with statistical significance, which products are replenishable — the difference, for example, between a bag of coffee and coffee maker.
“Our system goes through the thousands of SKUs in retailers’ catalogs and looks through the purchase histories, identifying whether or not people have purchased items repeatedly,” Williamson said. Once the system has established statistical significance, it profiles those products and then identifies how long it takes for someone to consume it.
“We can see in the general population that people consume that particular SKU in a 27-day cycle,” he said. “So then we try to get in front of them on day 22 to say, ‘Our records indicate that you bought coffee on this date, and you might be out soon; click here to reorder.’”
Once an individual reorders, Windsor Circle’s machine learning updates the customer’s data to reflect personal consumer product life cycle.
What it boils down to, Williamson said, is that merchants and retailers are trying approximate a concierge level of service and engagement with their customers.
“We all love it when we walk into our favorite bar, get greeted by name, and they already have your favorite drink ready. That kind of experience is what keeps you walking in.”
Williamson noted that the replenishment automator function alone on average can raise a merchant’s retention rate by 7 percent.
“It’s a significant uptick for the customer,” he said. “Some of our customers are large enough that if you can eke out even a 0.5 percent increase, it translates to some serious extra dollars.”
On average, Windsor Circle’s clients also see between a four- to 10-fold increase on return on investments by incorporating the Predictive Lifecycle Marketing Platform into their ecosystem.
And Windsor Circle has upcoming plans to increase the platform’s functionality and features in a number of ways.
“We’re working on a predictive gifting algorithm,” Williamson said. “We can use our array of data science and machine learning to identify which products are gifts, which aren’t and what the use case of a gift might have been.”
Additionally, later in the first quarter of this year, Windsor Circle is developing a social media function in response to client demand.
“At the internet retailer show this past year, we had multiple customers come to us and say they were using the predictive science of our platform to identify customers who were interesting for some reason — buying in a particular category, predicted to churn or return to the life cycle purchasing moment — and loading those names and emails into Facebook to target them there,” Williamson said.
The new feature will automate this process, using its platform’s predictive science capabilities to allow merchants to leverage the data analytics to create targeted, personalized ads on Facebook based on purchasing history and product life cycles.