WestPoint Stevens

Segmenting and versioning to optimize ROI

WestPoint Home Stores is the retail division of WestPoint Stevens, Inc., a national manufacturer and marketer of bed, bath and linens, whose brands include Ralph Lauren, Martha Stewart, Martex, Patrician and Disney Home, among others.

WestPoint Home Stores was working its way back from several years of severely declining sales, corporate bankruptcy and lost revenue due to the closing of 20 outlet stores. Executives were looking for innovative ways to drive traffic and increase revenues.

After analyzing disparate databases and cross-referencing point-of-purchase transactional data with classification and descriptor attributes, we immediately noted distinct and definitive customer profiles, spending habits and value to brand. Based on product mix and transactional histories, three consumer categories — fashion-focused, moderate and value-focused — lent themselves to segmented customer communications. We proposed a customer relationship management approach to expand the stores’ traditional marketing efforts.

Success
WestPoint Home reduced its marketing budget by over 50% and significantly increased the results of its marketing efforts, expanding its database from one million to ten million names and acquiring more in-depth knowledge beyond standard differentiating factors. Matching images, offers, messages and channels with customer profiles not only resulted in increased sales across the board, but also revealed the significant cost of sending customers the wrong message. ‘Fashion-conscious’ customers, for example, were 73% less likely to respond to price-related messages than ‘value-focused’ customers. The program generated a 181% ROI in 36 months.