TM: How should direct marketers gain insight into the importance of cross-sell offerings?
CO: We're actually doing a lot of testing with cross-sell offerings across the site from the homepages through the cart. Companies should look at finding out how people are browsing and buying. It is important to tweak the algorithm to serve up the best possible recommendations. It's definitely highly beneficial in increasing your average order value.
TM: PETCO already provides customers with a lot of cross-sell opportunities, correct? Why continue to test?
CO: Yes, but we're still testing. In this economy, it's really important to justify marketing investments based on results and to adjust programs along the way. Your product assortment is continually changing. What a person purchases together one month may differ in the future. There are definitely cycles for some products and product offerings. Everything's always an ongoing test. Yes, we have a lift now, but how can we make that lift better? And so we're always improving upon it.
TM: What value do promotions have, and how do they work together online to optimize clicks?
CO: You have very limited space on your Web site and very limited time to engage visitors before they abandon your site. It is important to utilize the space to engage someone to clickthrough to see the actual offering and/or to make a purchase.
This is where benchmarking comes in—you want to spot trends and compare your performance against your competitors, or even against how you were doing last year. We've created benchmarks on our placements, and we're getting to a point where we know our dollars per day that we should be seeing in those placements. We focus on many key performance indicators to determine successfulness: dollars per day, sales of advertised products and shift in product views (during [the promotion] and prepromotion).