Tim Grace, VP eCommerce at The Tie Bar, talks about using data and optimizing online marketing to grow a successful e-commerce brand.
We recently published The Custora E-Commerce Pulse High-Growth Fashion Index: A new report analyzing 20+ fashion and lifestyle retailers that grew their online revenue and transactions the most in 2014. Our goal was to understand what makes these high performance retailers different from everyone else, resulting in a growth rate that is almost double the industry average. Some of the findings are straight-forward — e.g. using data effectively is a must — while others are more surprising: e.g. for the best retailers, 27% of new customers make a second purchase within 60 days of their first purchase. You can download the full report here.
Recently, we hosted a webinar with one of the brands featured in the report. Tim Grace, VP eCommerce at The Tie Bar, went “on the record” and shared advice and tips on building and growing a successful e-commerce brand.
Below are highlights from the interview, lightly edited for brevity and clarity. You can listen to the entire interview or get the accompanying deck (PDF) below.
About Tim and The Tie Bar
Tim Grace is an accomplished e-commerce and digital marketing leader. Currently VP eCommerce at The Tie Bar, Tim is responsible for the breadth of their digital business, including technology, customer experience, and acquisition / retention marketing. Prior to The Tie Bar, Tim held a series of marketing and product positions at online retailers Trunk Club, Apartments.com, and Cars.com. He has a breadth and depth of experience in customer experience, e-commerce marketing, analytics, and mobile (case in point: He built a mobile app for the iPhone 3 back in 2010).
The Tie Bar is a leading online retailer of men’s accessories. They’re primarily an e-commerce business, and have a few strategically placed storefronts, as well as partnerships with like-minded retailers such as Nordstrom. Like other vertically integrated retailers (Warby Parker, Bonobos), The Tie Bar controls its supply chain, and is able to deliver a premium product at a competitive price point as a result.
3 Tips for Building a High-Growth Online Fashion Retailer
Here are three strategies that have been effective for The Tie Bar in building and scaling their e-commerce business. Tim covered a lot more in our conversation beyond these three, including advice for starting out with brick & mortar stores, the online marketing channels that drive the most e-commerce transactions for The Tie Bar, and successful email marketing hacks. Listen to the full webinar recording or get the presentation deck if you’re interested in learning more.
1. Email marketing – cart abandonment accounts for 20% of The Tie Bar email revenue
As demonstrated in the channel diagram above, email marketing is a key channel for the high-growth online fashion retailers included in our index. During the webinar, we discussed several email marketing optimization tactics that have been proven to be effective for The Tie Bar – including segmentation, win-back campaigns, and experimentation on demographic variables like gender (the full webinar recording includes all of these).
One central component of The Tie Bar’s email marketing program is their Cart Abandonment emails.
“Cart abandonment email has been very effective for us. In fact, it accounts for 20% of our email marketing revenue. If you’re not doing it, I would say please do start doing it.”
Interestingly, these emails help The Tie Bar improve lower conversion rates on mobile devices (phones and tablets).
“One of the things we think about a lot is mobile. Mobile conversion rates are not great compared to desktop for pretty much every retail brand I’ve talked to. Email is a great way of trying re-engage those mobile folks, who are interested in your products and want to buy them, and are probably distracted, in many cases, from completing this transaction on mobile.
It’s just a great reminder that they did really want to buy something from you. So I would absolutely endorse cart abandonment emails.”
2. How to use data effectively as a lean team: Use existing tools instead of trying to re-invent the wheel
“It becomes so hard to get access to the data so you find yourself not using data, which is dangerous.”
If there’s one common thread to almost all e-commerce brands we surveyed, it’s having a small, lean marketing team. No matter if you’re part of an e-commerce startup or an established omnichannel retailer, chances are your marketing and e-commerce team is small, over-stretched, and overwhelmed by the all the channels, tools, and programs they need to execute on.
The Tie Bar is no exception: A “lean & mean” team that has managed to accomplish a lot with a little. What’s their secret?
“As young companies grow, the team figures out how to do a lot with a little. ‘I don’t have all the tools so I’m just going to find out how to write SQL queries and go directly into the database.’ That’s awesome but it doesn’t scale. It becomes so hard to get access to the data so you find yourself not using data, which is dangerous.
“For us, we’ve been able to rely on tools like Custora and Tableau, which has freed up our team to take more of the right actions. You should find the most effective, one data visualization tool that allows you to get more or less the easy answers to your questions, and helps you focus on what the right data is.
“For a lean team, to be able to get more of that signal is hugely valuable in focusing our efforts.”
As a retailer that recognizes the importance of data and analytics, you may be tempted to build your own in-house team of data scientists. Tim shared some words of caution:
“I have been a part of building a data science team in the past, and 100% of what we got out of doing this is very much in line with what we get with Custora today. You might be thinking about the ideal case, ‘If I can have a team of people who are thinking about my business all day long, and trying to solve my unique problems, of course I would want that’. But those sort of resources are very difficult to get, and it’s a very expensive proposition. Many of us are not in a position where this is going to make sense.”
3. Using predictive marketing analytics to gain a competitive edge*
(*short Custora plug ahead)
Most of the high-growth retailers featured in our index use predictive marketing analytics to improve their customer acquisition and retention programs. Tim shared some specifics of how it’s done at The Tie Bar, which uses Custora as their predictive marketing platform.
“We use predictive analytics at The Tie Bar in several ways.
1. “Optimizing acquisition for high value customers: For every new customer, Custora predicts their future CLV (customer lifetime value), and what kind of purchase cadence they might be on in their future relationship with us. This helps us look at which acquisition channels drive folks who are going to be strong customers for us in the future – or not. It allows us to do optimization around that.
2. “Monitoring the health of our customer database: Custora gives us a great snapshot of the health of our overall customer base. What % of our customers are active, which are at risk of churning, how it changes over time; and which of our actions are leading to those outcomes. We have a weekly conversation around some of those metrics as a company. [for more about these metrics and KPIs, see this cheatsheet]
3. “Using predictive customer segments to improve our our email campaigns: All the data I just talked about, the various segments Custora produces for us, is tied directly to our ESP (email service provider). We use that to create and segment a number of our email campaigns. In fact, very few of our campaigns don’t have some thoughtfulness around targeting and segmentation. Things like winback campaigns are a meaningful part of our email marketing cadence right now, and they’re entirely based on data that we get from Custora. We wouldn’t be able to do those, certainly wouldn’t be able to do them very effectively, if we didn’t have Custora being able to identify folks who are going to churn.”
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