Consumers are growing more savvy, dictating trends and where/when/how they want to shop. Gone are the days when brands develop the merchandise that drives trends.
“Because of these factors, it has become increasingly important for retailers to shift from a push model (where the retailer assumes they know what the customer wants) to a pull model (where the customer tells us what they want),” explains Hannah Hale, director of product strategy and innovation at Lucky Brand.
By using a product intelligence platform from MakerSights, Lucky Brand has implemented a “pull model” and leverages customer insights to drive informed product decisions and invest in winning products.
By inviting consumers to weigh in on future products and applying proprietary predictive analytics to their feedback, Lucky Brand is able to develop more accurate sales plans, de-risk new product introductions, and measure how customers respond to product attributes like fabrics, colors and price — all within minutes.
How it Works
Before working with MakerSights’ platform, Lucky Brand was using a traditional and much longer in-store testing process. Now, customers receive a branded email asking them to rate and give feedback on 10 to 12 products. Seventy-five percent of consumers give their feedback via a mobile device, and it usually takes 60 seconds or less.
“We've learned a lot of valuable demographic as well product-based insights about our key segments,” says Hale. “The top 10 percent of our customers comprise a meaningful percentage of our revenue. We owe our business and brand success to these customers, and because of this it’s incredibly important that we listen to their needs and continue to provide them with relevant product.”
The platform informs Lucky Brand of crucial decisions along the product development lifecycle, including:.
- Concept: Lucky Brand can gauge customer interest in new product concepts before samples are created.
- Line Review: Lucky Brand can use the data collected to determine what products are most likely to sell and which aren't.
- Hindsight: Many brands use past product sales as a starting point when developing new products. The data Lucky Brand collects gives it the understanding of what product attributes customers liked, therefore informing future product direction.
Benefits of Testing Product Design
Two of Lucky Brand's key initiatives are customer centricity and speed to market, and MakerSights allows the brand to be better at both.
- Customer Centricity: Lucky Brand can ask its customers demographic questions, product-based questions and more, all while segmenting the emails to different lists. “These insights are critical as we continue to segment our customers and learn more about their specific needs,” explains Hale.
- Speed: Hale’s team is able to now make quicker, more informed decisions about what products Lucky Brand's customers are interested in. This results in fewer markdowns and out-of-stocks. “The process is quick (24-hour turnaround) and the tool is easy for the merchants to use,” says Hale.
Retailers using the platform, including Lucky Brand, typically see a 2 percent to 4 percent increase in gross profit margin and are able to continuously improve business processes.