Brand Collective is the apparel group whose brands include Clarks, Hush Puppies, Shoes & Sox, Superdry and Volley. Using the Lexer CDP and strategic guidance from the Lexer Success Team, Brand Collective uncovered key insights about recent market changes and quickly pivoted their business activities to successfully engage customers in this “new normal” of retail.
Amidst significant change and continued uncertainty regarding the COVID-19 pandemic and its impact on consumer behavior, the team at Brand Collective focused on their data to glean insights into their customer base and make informed decisions about the rapidly changing future.
Because traditional brick-and-mortar stores have been closed or avoided by cautious shoppers, millions of new customers are shopping online for the first time and existing ecom shoppers are trying new categories and brands. Across industries, marketing budgets have been cut due to uncertainty, and both businesses and consumers have been forced to experiment with new ways of engaging with each other—primarily by turning to digital.
In fact, Q2 of 2020 saw the highest ecommerce penetration of any quarter or year on record, with more than $1 for every $5 spent online for a year-over-year growth of 44.4 percent.
This accelerated boom in digital commerce, coupled with chopped marketing budgets and evolving consumer behaviors, created a challenge for consumer-facing businesses around the globe, and a situation where only the most creative, agile, and data-driven businesses may survive.
Brand Collective will be one of those businesses. Using the Lexer CDP, we helped Brand Collective create a unified, enriched, and actionable single view of the customer. With holistic customer data maintained in real-time and housed within the easy-to-use Lexer platform, the team at Brand Collective was able to self-serve insights at both a brand and a group level; build targeted segments that can be pushed across marketing channels such as email, social, search, mobile, and display; and develop an action plan for seizing new opportunities and avoiding risks as the market continues to evolve.
Armed with these insights and strategic guidance from the Lexer team, Brand Collective:
- Acquired brand new high-value customers based on insights from current high-value segments.
- Identified relevant customer segments to grow lifetime value.
- Improved overall media effectiveness, boosting ROI and reducing costs.
- Developed innovative solutions for improving business operations for the future.
4 ways Brand Collective used the Lexer CDP to respond to change
1. Grasp the digital marketing opportunity.
Following lockdown orders around the globe, consumers increased their screen time and digital commerce skyrocketed. The cost of media didn’t increase as much, however, creating an opportunity for high-powered digital marketing.
To grasp this opportunity, Brand Collective:
- Increased their overall digital marketing spend, with an aggressive focus on net-new acquisition.
- Increased the number of digital campaigns they were running, personalizing the creative and messaging for specific high-value segments identified in the Lexer CDP.
- Leaned on their marketing partners, including the Lexer Success Team, to discover additional customer insights, orchestrate each campaign, monitor results, and increase the capability and capacity of their internal teams.
Using predictive attributes within the Lexer platform, Brand Collective was able to segment customers by predicted lifetime value, profitability, and churn risk, as well as their likelihood of engagement based on past and present behavior. This information helped them target the right audiences—not just any audience—for digital acquisition. To read more about Lexer’s 4-step process to acquiring high-value customers, click here.
As a result of these activities, Brand Collective saw a 220 percent increase in return-on-ad-spend, a twofold increase in new customer acquisition, and a five times increase in revenue from paid channels.
2. Reinforce brand equity through digital channels.
Customers love and trust their favorite brands for a reason, and Brand Collective understood that a one-size-fits-all approach to digital commerce across their apparel group wasn’t going to drive the results they needed. As customers moved from retail stores to digital channels to engage, they would be looking for the brand-specific experiences that they’d grown to love in-store.
Example #1: Shoes & Sox offers digital fit appointments.
Shoes & Sox is part of the Brand Collective group and the biggest children’s footwear retailer in Australia. They’re known for being experts in fitting children’s footwear, so they searched for a way of replicating this expertise digitally, even though stores were closed.
Using the Lexer CDP, Brand Collective orchestrated targeted campaigns offering online fit appointments with Shoes & Sox’s store management and retail staff. This strategy delighted customers by offering the Shoes & Sox experience online, reinforced their brand positioning, and made good use of the capacity and capability of their experienced retail staff despite store closures. Both new and old customers responded positively to this initiative, giving Brand Collective incentive to find room for it in their long-term strategies and plans.
The success of a campaign like this depends on one critical thing: A holistic understanding of the core customer. With a single customer view enabled by the Lexer CDP, Brand Collective achieved a granular understanding of their highest-value customers and used those insights to inform their next steps.
3. Segment product distribution through marketplaces.
Brand Collective had been using marketplaces as a strategic sales channel for some time. With a small existing presence on The Myer Market and THE ICONIC marketplace, they were beginning to think about what other marketplaces they might utilize to establish new sales channels.
They realized, however, that they shouldn’t start selling all of their products from all of their brands in just any marketplace—but because there are so many different marketplaces available, they could use them for segmented distribution by matching certain brands to best fit marketplaces and therefore drive overall performance increases.
Therefore, along with adding new marketplace channels, Brand Collective:
- Increased the range of products offered on existing marketplaces.
- Increased engagement in co-operative marketing campaigns on existing marketplaces.
- Developed distribution strategies to ensure that each brand’s positioning is aligned with the marketplace’s goals for both the short and the long term.
Consequently, Brand Collective has seen a significant increase in marketplace sales, faster and more profitable liquidation of clearance inventory, and greater brand awareness, particularly for the smaller niche brands in their group.
As the retail environment continues to evolve, Brand Collective will use the Lexer CDP to understand what a marketplace customer looks like and how they differ from a direct-to-consumer or in-store customer. These insights can be used to acquire more customers across all channels and optimize their marketplace strategy for maximum return.
4. Make strategic and structural business changes.
COVID-19 has accelerated the growth of digital commerce and shifted the landscape permanently. In evaluating the impact of these strategic, structural, and operational changes on their business, Brand Collective needed to decide what they should embrace and what to leave behind.
These changes for the better include:
- A business-wide shift to digital-first thinking: Because the demand for digitally-focused businesses has increased in the wake of the pandemic, it’s no longer enough to have a “digital” division that is siloed from the rest of the business. Instead, the entire organization needs to think and act digitally. This shift is enabled in part by unifying all of Brand Collective’s channel-based data into individual customer profiles within the Lexer CDP.
- Marketplaces as a strategic distribution channel: It’s clear that marketplaces are here to stay, and Brand Collective’s continued success will come from utilizing them effectively over both the short and long term. They’ll learn from the way their current marketplace strategies are performing, monitoring sales and customer engagement with Lexer’s easy-to-use tracking tools.
- Navigating work-from-home operations: Like many of us who were forced to work from home due to lockdown orders, the team at Brand Collective found that there were both pros and cons; if high communication standards were maintained, even for more challenging work such as cross-functional collaboration, then productivity could be maintained and even improved in some cases. With native tools to support every team, Lexer democratizes access to customer data and helps Brand Collective to continue offering this freedom to their employees without sacrificing productivity.
- Managing operational workload: The burst in volume of sales from digital and marketplace channels increases the operational workload to new areas throughout the business—including fulfillment, logistics, customer service, digital marketing, and design—so Brand Collective needs to reorient their organization around the ability to do this more quickly than they initially thought. They’ll also continue to monitor performance across the business to understand where their pressure points are and how to adjust operations moving forward.
Data—the key to navigating change and uncertainty
With access to a unified, enriched, and actionable single view of the customer within the Lexer CDP, Brand Collective is able to better understand the impact of major market changes like COVID-19 on consumer behavior. Meaningful insights derived from Lexer’s straightforward tools help them create enhanced customer segments and deliver personalized experiences across brands.
“Lexer have been great in driving new ways of thinking about how we bring together customer data from different sources,” says Patrick. “They’ve also been great at providing new ideas from a direct marketing perspective. The space of personalisation and harmonising customer data is just in its infancy, so it’s amazing to have a technology partner with a strong product and the ability to challenge our thinking, as it greatly helps growing into that space.”
Although the digital commerce landscape will continue to evolve, Brand Collective will continue to track, learn from, and adapt to these changes with a data-driven, customer-first mindset, enabled by the powerful Lexer platform.