The most important thing to a retailer is repeat business. If you go to a store once, then never come back, there's little chance of that store staying open. And so customer retention is key to long-term success. The only question is how do you get them to keep coming back?
Customer retention platform Retention Science has the insights to get that answer, and now it has just raised a $7 million in Series A funding round to go even deeper, the company has revealed to VatorNews.
The round was led by Upfront Ventures, with participation from Baroda Ventures, Forerunner Ventures and Mohr Davidow Ventures. Retention Science had previously raised $2 million in seed funding, bringing its total funding to $9 million.
The Santa Monica-based Retention Science helps online commerce companies maximize customer retention and loyalty. The company aggregates customer demographic data, on-site behavioral data, historical/sales data, and social data to predict the best course of action to take in order to re-engage a customer. Some of the customer behaviors it monitors include time spent on the site, browsing pattern, abandoned cart items, and more.
"We enable retailers to create dynamic one-to-one communication by leveraging different data points to understand exactly what the customer profiles look like," Jerry Jao, CEO of Retention Science, explained to me in an interview. "We recommend the best timing of engagement, product promotions and content creatives to help make the communication and experience relevant to existing customers. As a result, they are better communicated and engaged."
For example, a marketing managers might use Retention Science's marketing platform to optimize, schedule and manage their marketing campaigns across mobile, email and on-site display. They can track the results of their campaigns, optimize and A/B test marketing campaigns.
While there are others in this space going after the same market, including AgilOne, Windsor Circle and Custora, what separates Retention Science is what it does with the data it collects.
"We focus on turning data into actionable insights. We are not an analytics company that just displays charts and analytics, we focus on generating campaign recommendations based on our proprietary predictive algorithms which learns across all industries," Jao said.
The company has collected over 65 million profiles and "learned from their user actions and we believe that 'data network effect' gives us a competitive advantage."
In addition, he pointed to the fact that Retention Science aggregates 3rd party data sources, such as Census Bureau demographic data and social data.
The new funding will be used by Retention Science to accelerate hiring, specificially in its sales and marketing team, with the intention of doubling its employee base by the end of the year.
Founded in 2012, Retention Science is growing quickly. Its clients base had increase by six times in the past year, and includes Vitamin Shoppe, Neiman Marcus, Dollar Shave Club, The Honest Company, and Too Faced Cosmetics. It also increased its revenue by 20 time from last year to this year's projected earnings.
"Our key philosophy is that existing customers are seven times more valuable than existing customers, and therefore, marketers should really pay attention to making existing customers happy," said Jao. "Our goal is to help turn visitors into one-time buyers, and convert one-timer buyers into repeat buyers, and cultivate repeat buyers into brand advocates."
In addition to the funding news, Retention Science also announced that it adding Upfront Ventures partner Greg Bettinelli, and Forerunner Ventures founder Kirsten Green, to its board of directors.
(Image source: retentionscience.com/blog)
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