Multichannel Marketing, The Patagonia Way

In some respects, Patagonia marches to the beat of its own drum. The Ventura, Calif.-based marketer of rugged mountain climbing and backpacking apparel marketer adheres to strict product quality, catalog style and lifestyle values, all keys to its raison d’être that it never compromises.

In other respects, Patagonia’s multichannel approach -- including not only catalog, Web and retail, but also wholesale -- represents something of a textbook model of today’s multichannel retail business model. Putting both elements together, two Patagonia executives -- Morlee Griswold and Chris Todd -- delivered a session at this week’s DMA06 Conference in San Francisco on how they compile and evaluate the company’s customer database incorporating the diverse attributes of catalog, search, and affiliate marketing customers and prospects.

Looking first at its catalog buyers, Griswold pointed out that once you “slice and dice the whole recency/frequency/monetary thing, you’re going to mail all of your 24-month buyers. Then you can look at what merchandise they’re buying, where they buy in the country and most importantly, where they fall out in the customer lifecycle.”

She broke out three types of Patagonia buyers: casuals, loyalists and cheerleaders. Casuals are one-time buyers who are new to the brand. Patagonia estimates that 64 percent of first-time buyers don’t buy again. Loyalists, who become avid buyers, are worth $134 over two years to Patagonia. They understand the company’s core values, appreciate the clothing’s durability and performance, as well as the company’s liberal guarantee. Still, “we lose about 50 percent of these buyers after two years,” Griswold said.

Cheerleaders start identifying with Patagonia’s core values and appreciate its socially conscious business practice. They’re avid buyers, 95 percent of whom recommend the company to friends and family, often via online communications. “You find these pockets of people who think like yourself and become extremely good buyers,” Griswold said. In two years, cheerleaders have a contribution of $406.