Victoria’s Secret Sauce – Web Analytics and Customer Experience Optimization

Introduction

Victoria’s Secret is a women’s fashion brand owned by parent company Limited Brands. As of January 2012, Victoria’s Secret has 1,017 stores with over 6 million square feet of selling space inside these stores. Inside a VS store, you will find a dazzling assortment of intimate apparel, beauty products, sleepwear, hosiery and more (About, 2012).

Victoria’s Secret Direct is the business arm that handles the Victoria’s Secret Catalogue and its ecommerce site, VictoriasSecret.com. VS Direct makes it possible for customers to have a great VS customer experience anytime and anywhere they want. The VS Catalogue reaches more than 390 million customers each year. The VS website and catalogue together brought in over $1.5 billion in net sales last year, a 4% sales increase (About, 2012).

Web Analytics Techniques the Company is Employing

Victoria’s Secret uses IBM Coremetrics to collect web analytics data from their website. VS began using Coremetrics in 2002, before the analytics company was bought in 2010 by IBM. Victoria’s Secret specifically uses Marketforce, a complete data capture, storage and decision-support system that gives companies knowledge of customer and visitor activity online. The Coremetrics marketing analytics platform captures and stores all customer and visitor clickstream activity to build LIVE (Lifetime Individual Visitor Experience) Profiles of online customers and visitors over time and across digital channels (Peters, 2002).

Fast forward 10 years, and now IBM owns Coremetrics and has integrated into the IBM Digital Marketing Optimization Suite, which itself is part of the IBM Enterprise Marketing Management Suite. Marketers are provided with a data warehouse on visitor’s digital journeys, across marketing touchpoints and channels, and even offline (IBM, 2012). Real-time KPIs and dashboards, mobile device analytics, powerful attribution capabilities, ad-hoc explorative analysis and reporting, segmentation capabilities, custom reporting are all features of the integrated Coremetrics platform.

How They Are Using Collected Data

The reason for Victoria’s Secret using analytics is to optimize the online customer experience and improve profitability. When they first began using Coremetrics, the goals were to use the knowledge gained to optimize the shopping path design, reduce website abandonment rates and improve retention marketing initiatives (Peters, 2002).

“We are very focused on customer service, with a firm commitment to making the online experience as rewarding for customers as our catalog and in-store experiences. Coremetrics provides extremely detailed analysis of our customers’ online behavior, delivering insights that help us improve the online shopping experience and run our web site more effectively. The combination of a rewarding shopping experience and increased efficiencies in managing our online channel has resulted in opportunities for revenue enhancement,” said Ken Weil, the vice president of new media at Victoria’s Secret (Peters, 2002).

Victoria’s Secret was ahead of its time in being this concerned with their online customer experience optimization. Many Internet retailers today still have not embraced the concept of customer experience optimization like they should be. Failing to realize how important the unique experience that customers have with your brand could be fatal in the competitive business environment today.

According to the Victoria’s Secret privacy policy, cookies and clear gifs are used to better understand website user behavior. Helping to improve the VS site, provide better customer service, personalize user’s online experience, and personalize offers based on user’s unique tastes, interactions and purchase history are all ways that VS uses the data it acquires about customers and website visitors (Privacy, 2012).

Tools, Data Collection Methods, or Metrics that Could Improve Overall Web Analytics Efforts

Since Victoria’s Secret spent about $12 million on the Victoria’s Secret Fashion Show this year that aired on CBS on December 4, VS marketers should collect data and follow metrics that are specifically for the fashion show. According to financial analysts, the show pays for itself as a marketing tactic because of the sales increases that occur during and after the fashion show (Maheshwari, 2012).

According to Ed Razek, Chief Marketing Officer of creative services of Limited Brands, “you see sales results almost immediately. On the night of the show you see substantial increases in our web business from all of the news coverage. The day after the fashion show runs on television, you see substantial increases in our web business” (Amed, 2011).

Sales increases are great, but the VS Fashion Show is about more than just sales increases—it is the cornerstone to the VS integrated marketing communications strategy that drives brand awareness as well as sales across retail, catalogue and online channels. According to a Dartmouth case study, when Leslie Wexner bought Victoria’s Secret, he wanted to make it “stand out as an integrated world-class brand. The same products are launched at the same time, in exactly the same way, with the same quality and positioning” (Durbin, 2002).

Since VS has both sales and brand awareness goals associated with the VS Fashion Show, these goals should be connected to web metrics that can measure them. I would find a way to measure all inbound traffic sent by the fashion show. A specific landing page for people visiting the website because of the show would separate traffic generated from the show from regular traffic. Brand awareness could be measured by quantifying the social media mentions, posts and conversations that have to do with the VS fashion show. Sentiment analysis for specific show-related keywords could show the lift that the VS brand receives because of the show.

Conclusion

Victoria’s Secret is doing many things right, and they are way ahead of many other Internet retailers when it comes to optimizing their customer experience. But there are always improvements that can be done, and I think using web metrics to show how successful the Victoria’s Secret Fashion Show is something VS marketers should definitely do.

References

About Victoria’s Secret. (2012). Limited Brands. Retrieved on 12/10/12 from http://www.limitedbrands.com/our_brands/victorias_secret/about.aspx

Amed, I. (21 November 2011). Addressing Fashion’s Communications Conundrum. The Business of Fashion. Retrieved on 12/10/12 from http://www.businessoffashion.com/2011/11/addressing-fashions-communications-conundrum.html#more-26875

Durbin, T. (2002). Victoria’s Secret. Tuck School of Business at Dartmouth: Center for Digital Strategies. Retrieved on 12/10/12 from http://digitalstrategies.tuck.dartmouth.edu/cds-uploads/case-studies/pdf/6-0014.pdf

IBM Digital Analytics. (November 2012). IBM Software Data Sheet. Retrieved on 12/10/12 from http://public.dhe.ibm.com/common/ssi/ecm/en/zzd03044usen/ZZD03044USEN.PDF

Maheshwari, S. (20 November 2012). The marketing secrets of Victoria’s Secret. Chicago Tribune. Retrieved on 12/10/12 from http://www.chicagotribune.com/business/ct-biz-1120-bf-secret-marketing-20121120,0,5870626.story

Peters, K. (29 July 2002). Victoria’s Secret Selects Coremetrics to Optimize the Online Customer Experience and Improve Profitability. Internet Retailer. Retrieved on 12/10/12 from http://www.internetretailer.com/2002/07/30/victoria-s-secret-selects-coremetrics-to-optimize-the-online-c

Privacy Statement. (26 October 2012). Privacy & Security. Victoria’s Secret. Retrieved on 12/10/12 from http://www.victoriassecret.com/privacy-and-security#technology