Lands' End empowers marketing staff and develops more targeted campaigns with IBM Unica Campaign

Published on 19-Aug-2011

Validated on 01 Mar 2013

"Ultimately, we were looking for business functionality in a system designed for marketers, not programmers. IBM Unica’s solution proved to be superior to the others." - David Johnson Vice President, Direct Marketing, Lands’ End

Customer:
Lands' End

Industry:
Retail

Deployment country:
United States

Solution:
EMM - Cross-channel Marketing Optimization, Smarter Commerce, Smarter Marketing

Overview

Lands’ End is a global direct merchant of classically inspired clothing for men, women and children, soft luggage and products for the home. Its offerings are sold through regular mailings of catalogs and a web site—landsend.com.

Business need:
• Decouple interdependence of technical architecture and business process • Leverage data disbursed across multiple systems • Replace legacy infrastructure and hard-coded business rules • Enhance ability to segment and target customers

Solution:
The IBM Campaign management application for personalized, relevant marketing across all channels.

Benefits:
• Marketing staff can manage campaigns from design through execution • Flexible, open systems environment • Integrated several systems and processes • Enhanced customer understanding across channels • Cost savings by reducing unprofitable mailings

Case Study

Lands’ End is a global direct merchant of classically inspired clothing for men, women and children, soft luggage and products for the home. Its offerings are sold through regular mailings of catalogs and a web site—landsend.com.

Faced with an increasingly saturated marketplace and a slowing economy, Lands’ End felt a growing need for hybrid—or multi-channel marketing campaigns—and a shifting management focus from product-centric to customer-centric strategies. Their end goal was to increase customer loyalty with the intent of increasing revenue.

As part of its effort to better understand and target its customers, Lands’ End undertook an extensive Customer Relationship Management (CRM) initiative.

Its CRM strategy involved leveraging the existing enterprise data warehouse, the creation of a customer data mart for campaign management, and the implementation of enterprise marketing automation software. This software would improve its current operational processes as well as enable Lands’ End to develop more targeted, personalized marketing strategies. It would also highlight gaps where additional process improvements could be made and provide insights into how to design the new data warehouse.

In developing its customer-based marketing strategy, Lands’ End had several key goals:

• Gain cost efficiencies by automating individual processes and eliminating constraints imposed by the current architecture and system

• Empower marketing staff to manage operational aspects of marketing campaigns (design and execution) while freeing up other resources to focus on strategic marketing (such as data mining and modeling)

• Reduce new customer acquisition costs and grow average revenue per transaction and customer

The challenges

Selection

Lands’ End launched an exhaustive process to identify, select and ultimately partner with a marketing automation vendor. Marketing and IT staff spent two weeks performing an online search to identify marketing automation vendors and gain an understanding of available solutions. Industry analysts, such as Gartner and Meta Group, provided additional insights to help identify market leaders. Lands’ End sent 11 RFPs (Request for Proposals) to identified vendors, including IBM® Unica®. The first-round cut was made based on ‘knockout’ criteria (for example, no large installs). The remaining five vendors were reviewed in detail and each was scored based on weighted factors for both the vendor and technology, including functional capability of the software, implementation timeline, support model, financial viability of the vendor, customer base and reference ability and rankings by industry analysts. Of the five remaining vendors, three vendors were invited on-site for a day-long demonstration of their software features and functionality and corporate vision. Each vendor was asked to address twelve scenarios specific to Lands’ End.

Not only was Lands’ End looking for robust functionality and the ability to automate complex processes of campaign design, development and execution, but also a solution provider that would be a partner in its overall CRM strategy.

Of the three technologies presented, IBM® Campaign was chosen as the optimal solution to automate Lands’ End’s catalog operations and boost its hybrid marketing capabilities. In addition, IBM Unica’s implementation methodology not only laid the foundation for a proven best practice implementation, but also afforded Lands’ End the flexibility to utilize flat file extracts from its mainframe customer database.

To address these challenges and achieve its goals, Lands’ End and IBM Unica planned an approach that relied on best practice methodology, tangible goals and prudent project scope. The technology needed to eliminate existing constraints and support the organization’s core strengths and primary business objectives. The chart below outlines Phase 1 of the CRM strategy.


Of the three technologies presented, IBM® Campaign was chosen as the optimal solution to automate Lands’ End’s catalog operations and boost its hybrid marketing capabilities. In addition, IBM Unica’s implementation methodology not only laid the foundation for a proven best practice implementation, but also afforded Lands’ End the flexibility to utilize flat file extracts from its mainframe customer database.

To address these challenges and achieve its goals, Lands’ End and IBM Unica planned an approach that relied on best practice methodology, tangible goals and prudent project scope. The technology needed to eliminate existing constraints and support the organization’s core strengths and primary business objectives. The chart below outlines Phase 1 of the CRM strategy.

Implementation Consistent with IBM Unica’s philosophy that the implementation of enterprise automation will affect people, process and technology, Lands’ End spent considerable time and effort understanding and developing a plan of how each of these areas would be affected as it enhanced its customer-centric strategies.

The solution

Product acceptance After the rigorous selection process, IBM Unica was chosen, and the company’s first task was to implement a pilot program. The pilot was completed in 14 weeks during the busiest time of year when Lands’ End was gearing up for the quarter in which it does about 40 percent of its annual business. Extracts from the legacy corporate database and flat files were used in product acceptance. Lands’ End had a persistent, unique customer key that allowed staff to join disparate data feeds. Additionally, through IBM Unica’s Universal Data Interconnect™ (UDI), IBM Campaign had the flexibility to map to any data structure available—relational or flat file—simultaneously so it could integrate last minute suppression lists or segments not stored in the data mart.

Production environment architecture Lands’ End migrated from its corporate database residing on a mainframe OS390 system to an open architecture on an IBM UDB-EE AIX system. The final environment was a physical two-tier implementation involving Windows clients, IBM Campaign Server and DB2 data mart on one RS6000/AIX. In addition, Promotion History DB2 Tables on the OS390 were accessed using IBM Campaign’s UDI capability.

The results

The selection and implementation of IBM Campaign has been a marked success. From the beginning, Lands’ End was adamant about picking a partner, not a vendor. They not only chose a technological solution that would enable them to meet their goals, but also a vendor that was the right “fit” for the organization and one that could help them achieve their objectives. This success did not hinge upon IBM Unica alone. The staff at Lands’ End also realized they played a big part in the success of the implementation and they held themselves accountable for their part in the implementation process.

Empowering marketing staffThe vice president of direct marketing was looking for a flexible system that had robust business functionality, as well as complex customer segmentation techniques. As David Johnson, Vice President, Direct Marketing, noted, “Ultimately, we were looking for business functionality in a system designed for marketers, not programmers.” Lands’ End anticipated that marketing roles would need to be reassigned and functional responsibilities realigned as necessary. The implementation of this software appropriately shifted the responsibility of campaign design and execution from Quantitative Analysts to Marketing Analysts, who are responsible for circulation and planning. The Quantitative Analysts now spend their time on more strategic database functions, such as data mining and model development for segmentation and targeting.

IBM Campaign, with its flowchart-based GUI for designing campaigns, provided marketing staff an intuitive and extensible tool for creating, documenting and sharing campaigns. It also enabled the staff to integrate several processes that were formerly discrete operations within the overall context of a campaign.


Gains in process improvements and integration. The implementation of IBM Campaign allowed Lands’ End to integrate several processes and boost the depth and effectiveness of its customer segmentation. With a strong need to show ROI derived from the implementation, Lands’ End was able to point to several areas where they attained significant upside. They retired five old systems, including their former segmentation and selection process, which were replaced by Unica Campaign. They were able to point to several technical ‘firsts,’ such as having a UDB-EE analytical processing database available on AIX. In addition, they were able to avoid hardcoded programming of frequently changing information, such as country suppression lists, by including this information as a user- defined and editable derived field in IBM Campaign. The Lands’ End customer segmentation process is now more robust and flexible. By not only having more data available for more effective targeting, fewer manually-driven processes and easier ways to suppress and segment its customer base, Lands’ End estimates it will recognize significant initial annualized savings by avoiding mailing catalogs to unproductive customer segments.

IBM Campaign and the completion of Lands’ End customer data mart enabled Lands’ End to gain a greater understanding of customer buying behavior and provide better customer information to the marketing staff. The implementation of the marketing automation strategy to this point has uncoupled the reliance of the marketing process on technical expertise and reduced the reliance on legacy, closed systems.

The future

Lands’ End will not only continue to derive value by enhancing revenue through its catalog operations, but also plans to drive more cross-channel marketing efforts. As IBM Campaign becomes the staple marketing tool, Lands’ End can define and track a multitude of customer contact strategies. The marketing staff can identify responders and non-responders and leverage either event-driven campaigns where the software detects a “trigger” (action or inaction) on the part of the customer and executes predefined campaigns, stream- based or longitudinal campaigns where a series of contacts can be made over time. Because IBM Campaign can support any number of versions of a mailing, Lands’ End can execute custom, individualized mailings, reducing overall production costs and enhancing revenue through its more customer-focused efforts.

For more information

To learn more about IBM Unica products, please contact your IBM marketing representative or IBM Business Partner, or visit the following website: ibm.com/software/info/unica.

Smarter Commerce: An integrated approach

IBM Unica products are part of the IBM Smarter Commerce initiative. Smarter Commerce is a unique approach that increases the value companies generate for their customers, partners and shareholders in a rapidly changing digital world. To learn more about Smarter Commerce, visit ibm.com/smarterplanet/commerce.

Products and services used

IBM products and services that were used in this case study.

Software:
DB2 for Linux, UNIX and Windows, IBM Campaign

Legal Information

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