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In the fast-paced work of online retailing, demonstrating return on investment remains a key priority for online businesses. Yet although the online environment is famed for its capacity for Big Data, with such a wealth of intelligence at their fingertips, online marketers can often struggle to identify the metrics that matter most. As online retailers fight to improve online conversion, many are discovering that, in the battle for meaningful metrics, finding a good customer experience optimization partner is perhaps the most effective measure of all.

The business

Virgin Wines is a retailer of boutique wines from small and medium-sized winemakers. The company was purchased by Direct Wines in 2005 but has, more recently, been the subject of a management buyout. Despite the November 2013 change of ownership, the business remains very much part of the Virgin family and its approach is synonymous with Virgin’s iconic brand values.

The company’s philosophy – “life’s too short for boring wine” – has seen it cultivate direct relationships with passionate and independent winemakers, and enabled it to differentiate itself from supermarket labels. With 85% of Virgin Wines’ revenues generated online, the business knew that it needed to optimize its dominant sales channel to improve engagement with its customers. To this end, in October 2012, it partnered with Maxymiser to develop a strategy that would inform a more customer-centric approach to its online operations.

“The website is core to everything we do, with pretty much every customer interacting with us online at some point during their journey. We knew that we needed to optimize that engagement, to make sure that everything we do is right for our customers,” says Paul Adams, Marketing Director, Virgin Wines. “So we commissioned some qualitative research into customer journey activity and this provided clues as to where we could improve the customer experience. These findings have informed our optimization strategy and helped us develop a comprehensive roadmap with Maxymiser that has so far yielded strong positive results.”

Marketing metrics

The rationale for the strategy was not only to enhance customer engagement and drive conversion, but also to provide more robust metrics on which the company could base business-critical decisions. “Prior to our partnership with Maxymiser, much of our web development had been based on intuition rather than robust evidence – and this was something we needed to change,” says Paul. “We wanted to introduce more of a direct marketing discipline, to be able to test different scenarios and understand what the results meant.

“In direct mail, continuous testing, and improvement, is commonplace – you measure all spend; assessing response rates, examining back-end conversion and establishing the most effective campaigns. In the online world, however, although it’s possible to measure everything, it can be extremely difficult to identify the things that are making a difference. To test one thing against another, it’s essential to have a multivariate testing structure. We wanted to introduce a structured approach to optimization. That’s what Maxymiser is giving us. It’s enabling us to take measurable actions, and playing a significant part in our growth and development.”

Brand differentiation

The partnership with Maxymiser is helping Virgin Wines to drive customer loyalty by reinforcing the brand values that distinguish it from its competitors. “We have discovered that if we pull people deeper into the site, they gain a greater understanding of what we are all about,” says Paul. “For example, we conducted a campaign that explored the presentation of our search page – in particular comparing a ‘grid view’ to our traditional ‘line view’. We found that with the grid view, customers had to drill down for more information – and when they did, they could see that we weren’t providing ‘label wines’, we were selling boutique wines, made and promoted by people who were really passionate about their product. All of a sudden, customers could see the ‘story behind the wine’. This immediately led to increased conversion.”

In fact, the winning experience from this comprehensive multivariate campaign that compared grid and line views on the search page led to a 10% net increase in ‘add to basket’ and a 6.7% uplift in purchase conversion.

The campaigns have also helped the company optimize its online positioning – ensuring customer communications are not only aligned with the wider Virgin brand, but also distinct from the more pretentious approach sometimes associated with wine. “The whole Virgin ethos is to break into an area, to be different, and to speak plain English! Virgin Wines offers handpicked boutique wines at a similar price to those found in the supermarket – but we strive not to pander to the pretentious approach that’s characteristic of most wine selling. Our approach is plain-speaking, imaginative, and occasionally ‘irreverent’ and our campaigns with Maxymiser are helping us measure that approach and present our wines in ways that appeal to our customers.”

The importance of simplicity and clarity of presentation was underlined by a more recent campaign that examined pricing display on product detail pages. The campaign experimented with different variants around the sizing of pricing/savings presentation, and the style and placement of calls to action. The winning experience generated a 4% increase in click-throughs to the basket page, a 6.67% rise in checkout arrivals – and a 4.99% uplift in purchase conversions.

The Virgin Experience

Virgin Wines believes its relationship with Maxymiser has flourished into one of a true partnership – and helped provide an independent perspective to support key strategic decisions. “One of the key things we wanted to do was introduce some external thinking into the business,” says Paul. “It’s very easy to allow your business to become too self-centred, but by having an external influence, we’re able to bring additional creativity and imagination into discussions. By putting this alongside our marketing and merchandising teams, it’s made a real difference.

“This was a major reason why we selected Maxymiser. They offer a great blend between the technology and the human input; their technical capabilities are clearly very good, but the real value comes when it is combined with a human partnership.”

The collaborative approach has helped Virgin Wines agree the structured, yet flexible, roadmap it required. “We’ve had great support from the outset. We had workshops to establish what we wanted to achieve and explore the different areas – and we took advantage of Maxymiser’s experience and skills to offer counterpoint to our views. That creative debate led to the roadmap being conceived early on, but as our discussions have germinated and experiences have increased, that roadmap has evolved. It continues to change in line with external thinking – and that’s exactly what we want.”

In the first year of the partnership, Virgin Wines’ CXO strategy has focused on making incremental changes through the purchase funnel. But it plans to develop capabilities for greater personalization. “In the future, we plan to be more radical. Today, we’re opting for steady optimization – and we’ve already seen that small changes can have significant benefits. But in marketing, it’s also important to look for paradigm shifts where you can move things on radically. So we are looking to develop parallel roadmaps that deliver marginal gains in some areas, and radical leaps in others. And that’s something that we think Maxymiser can support.

“This is an exciting time for the growth and development at Virgin Wines, and we look forward to continuing our relationship with Maxymiser. To date, the partnership has strengthened the business by providing a disciplined approach to optimization and enabled our operations to become more agile and efficient. It’s not only given us a valuable external perspective of our business, it’s helped us optimize our customer engagement and delivered a significant return on investment.”

Published on: 11:19AM on 24th March 2014