Waitrose has selected Performance display ad firm Criteo to implement a new personalised ad targeting scheme to boost online grocery sales. In this article, the supermarket giant explains its decisions to use personalised retargeting to upsell to online shoppers, and how it avoided potential privacy pitfalls.
The partnership will make Waitrose the first supermarket in the UK to use online personalised retargeting for groceries, helping to drive consumer relationships.
Visitors to Waitrose.com will be presented with relevant products and offers on selected media sites as part of their internet journey upon leaving the site.
This development marks an important step in Waitrose’s investment in its ecommerce platform over the last year, which included the opening of a dedicated Dotcom Fulfilment Centre in West London.
Waitrose’s commitment to its online channel enabled the retailer to increase online sales by 49% in the seven days leading up to Christmas 2011.
“As the industry leader Criteo was an obvious choice for us, enabling us to present consumers with relevant and up-to-date product information in a visually rewarding way,” said Nick White, Head of Online Commercial at Waitrose. “We are driving innovation in the grocery sector by being the first supermarket to adopt personalised retargeting, enhancing our ecommerce strategy and making online shopping even easier for our customers. We are already seeing a tenfold increase in the click-through rate compared to non-targeted display activity as well as a high level of conversions.”
Criteo leverages consumer intent in the same way as search advertising by showing ads for products based on the browsing behaviour of people on Waitrose.com.
Criteo uses a predictive engine that is able to recommend products based on the behaviour of other consumers that have viewed the same or similar products.
The adverts are created in real-time to ensure consideration of stock availability and pricing.
Waitrose can easily track the success throughout by comparing the cost of sale with the click-through purchase cost to ensure that it remains viable and successful.
“It is great to see an industry leader such as Waitrose driving innovation in the retail sector,” Michael Steckler, MD for Northern Europe at Criteo said. “We share a common goal as we continually aim to provide consumers with a more relevant online shopping experience,” he added.
Developments are also in progress to enable Waitrose to present consumers with items that they have forgotten to place in their online trolley prior to the delivery date as well as re-advertise purchased items once they’re likely to have been consumed.
Criteo has also provided a question and Answer session with Nick White, Head of Online Commercial at Waitrose, speaking about the supermarkets experience adopting new technology to boost sales.
Q. When did you start using this technology?
A. At the end of 2011
Q. Do the offers/ads always drive clickers back to Waitrose.com?
A. Yes – when a person clicks on a product within the Waitrose ad, they are taken directly to that particular product page. This leads to a much better conversion rate than directing them to a generic page or homepage.
Q. Can you expand on this?
A. “We are already seeing a tenfold increase in the click-through rate compared to non-targeted display activity as well as a high level of conversions.” The standard click through rate for display advertising is 0.1%. Because Criteo’s ads are so relevant to each shopper, there is a much higher propensity to click. The results are very promising and comparable to search marketing results.
Q. What are your thoughts on the fine line that exists between personalised browsing and the feeling of being watched?
A. That’s an important point. Our research shows that customers who shop online increasingly expect us to know more about them in order to provide a tailored online shopping experience. Retargeting is an extension of this personalisation off site. However, we do need to constantly test, monitor and optimise this type of technology, particularly when looking at the frequency it displays, to get the balance right. Also, this technology should and does provide consumers with transparent and actionable controls to manage the advertising they see. Every Criteo ad contains an ‘i’ icon – if you hover over this, it says ‘would you like to learn more about why you are seeing this ad?’ If clicked on, there is a very easy opt-out process.
Source: Criteo
Many retailers, including 24Studio have been using retargeting technology for a number of years now. This isn’t new; it’s just waitrose playing catch up with the rest of the online commerce industry. Hats off to them for being the first grocery retailer though.
It will be interesting to see how these systems fare following the introduction of the EU-cookie directives following May, though I expect it will probably be closer to Q3 / Q4 before they are fully implemented (no-one will be in a rush to put restrictions up).