Data Management for Analytics: An Inside Perspective

Conclusions Paper Data Management for Analytics: An Inside Perspective Chico’s Has Customer Loyalty ‘In the Bag’ Insights from a webinar in the SAS Applying Business Analytics Webinar Series Originally broadcast in September 2011 Featuring: Barb Buettin, Director of CRM-Enterprise Information Management for Chico’s Mark Troester, Senior Product Marketing Consultant for CIO/IT, SAS data management for analytics: an inside perspective “For 25 years, we’ve helped millions of women look as great as they feel. Our chic prints, artisan jackets and wrinkle-free Travelers collection have built quite a following at our boutiques – but we hear it’s our combination of great style, one-of-a-kind details and warm, personal service that has captured the hearts of women nationwide.” That’s the word from Chico’s, the specialty retailer of private branded, sophisticated, casual-to-dressy clothing, intimates, accessories and gift items. Chico’s was founded in 1983 as a small boutique selling Mexican folk art and cotton sweaters on Sanibel Island in Florida. The store’s friendly environment and unique styles connected with customers in a special way that evolved into nearly 600 Chico’s boutiques and 79 outlets nationwide, a monthly catalog, and round-the-clock online shopping at chicos.com. Today, Chico’s FAS (for “Folk Art Specialties,” reflecting its origins) includes three additional fashion brands: White House | Black Market, which operates 356 boutiques and 25 outlets, plus online and call center catalog shopping; 76 Soma Intimates boutiques; and, as of September 2011, the Boston Proper brand for online and catalog shopping. Although the brands serve very similar clientele, there are subtle distinctions. For example, the White House | Black Market customer tends to be younger. The vast majority of Chico’s customers are baby boomers. More than half of Soma customers are also Chico’s customers, but 40 percent are not – yet. All the brands attract customers with incomes higher than the US median, a clue that they will probably expect personal treatment. In fact, Chico’s FAS is known for sales associates’ relationships with their boutique customers. Not surprisingly, Chico’s found that its top customers shop and spend several times more than an average customer. Keeping these customers engaged – and identifying more like them – is paramount. But customers shop differently across multiple channels within a brand, across the various brands and in different areas of the country. Chico’s marketers needed a holistic view of customers across brands and geographies, to be able to answer the questions that all retail marketers face: • Which new customers have the greatest potential to be our best customers in the future? • How should we be stratifying and customizing our product lines for the greatest in-store benefit? • How can we reduce markdowns while more effectively targeting our clientele? • What type of interactions do customers want to experience when shopping with us? • How can we best customize our marketing communications to customers? 1 data management for analytics: an inside perspective The organization’s traditional data infrastructure generally couldn’t provide those answers, and where it did, it didn’t do it fast enough. Lack of data wasn’t the problem; Chico’s had a treasure trove of data from multiple systems and sources. What it lacked was a way to find and quickly work with the data to make rapid decisions. Limitations of Legacy Marketing Systems “Before SAS, we had Chico’s and Soma data in one database, and White House | Black Market in another database,” said Barb Buettin, Director of CRM-Enterprise Information Management for Chico’s. “We had a locked data model. We couldn’t add any elements to the data model; we couldn’t add columns, we couldn’t change columns, we couldn’t integrate in other databases. We were sort of stuck. “We couldn’t do a lot of things that we needed, such as make midpoint corrections, understand how to bring lapsed customers back and cross-sell effectively among our brands. These things sound simple, but with our disparate and disconnected databases, we had no holistic visibility into the customer and what she looks like as a total customer. “Anything that we wanted to do had to be done outside of that particular database, ■ Before SAS, customer data was and that just created integration nightmares, or we had to ship the data out. We would not aggregated across brands, the send data out to prospect against our own file, which seemed a little erroneous.” company couldn’t manage large volumes of data, and customer The time was ripe for a change, Buettin recalled. “Our marketing team was stretched to the limit, resources were tight, and visibility into the data was nearly impossible. The modeling was being done externally, business teams and marketing wanted to upgrade their toolset. They’d had the same with models out of date by the time toolset for about 10 years at that point.” they were returned to the company. Chico’s wanted a solution that enabled business users to work with the data without The in-house processes were labor- needing help from statisticians and programmers. The solution also had to have a proven track record in managing and integrating large volumes of data, without intensive, and the company couldn’t requiring a time-consuming installation. change direction mid-promotion. Marketers relied more on intuition SAS® OnDemand: Marketing Automation fit those criteria. The hosted solution enables than solid information about their marketers to plan, test and execute marketing campaigns of any size or level of complexity – taking advantage of a full set of predictive analytics and data mining tools. customers and what motivated them to buy. 2 data management for analytics: an inside perspective Inside the Cloud ■ “Our IT and business teams worked A growing number of organizations are investing in software as a service (SaaS), whereby a provider – in this case, SAS – houses the servers and software for data closely in partnership to evaluate management, modeling and reporting. Business users at Chico’s have secure access and select a solution. It was a pretty to their data, models and reports over the Internet. exciting place to be. But when we had the project in the approval This deployment model is changing the way businesses consume software-based state, we were getting a new CEO services, making high-end business analytics affordable and accessible for a greater variety of organizations – and financed as an operational rather than a capital and COO. We were worried our expenditure. Cloud deployments enable IT to do more with less, and are especially decision could be reversed. Actually, attractive for organizations that need to get up and running fast, in days or weeks the new executives were thrilled rather than six months or more. with our selection of SAS, quickly “The exciting thing for me, being in IT, is I don’t have to worry about the servers being approved it, and we moved forward up; I don’t have to worry about upgrading to the latest version; I don’t have to worry with it.” about any kind of database issues, because SAS handles all of that for us,” said Barb Buettin Buettin. “That’s a beautiful thing in IT, to not have to worry about that, so we can help Director of CRM-Enterprise Information Management for Chico’s the business focus on integrating the data, developing insights from that data, and creating the marketing that we need.