One Kings Lane realized a 4% increase in revenue leveraging Custora's predictive lifetime value segmentation

One Kings Lane is a leading online destination for the home that connects daily design inspiration with a fresh collection of select home goods, designer and vintage items you won’t find anywhere else. Every day the site features more than 2,000 new home products assembled around inspirational decorating themes. Since its launch in 2009, the company has grown to more than 8 million members, reached $200 million in revenue in 2012, and has a staff of more than 375 employees across three offices in San Francisco, New York, and Beverly Hills.


The Challenge:
Waiting around for customer lifetime value

OKL is a data-driven organization dedicated towards building lasting relationships with their customers. As a result, the marketing team keeps a close eye on Customer Lifetime Value (CLV). The team was interested in segmenting customers based on lifetime value, as this would provide a way to identify segments of loyal, active customers and other segments of customers who were less engaged – with the goal of personalizing marketing communication for each customer segment to drive long-term customer engagement and loyalty.

Previously, OKL was using a historical approach to calculating CLV by simply summing up the total amount a customer spent since signing up. However, for the marketing team, this historical approach had a big limitation. There was no way for the group to quickly identify the lifetime value of customers who signed up recently. In fact, the team had to wait a year or more to start getting a picture of lifetime value, which made it difficult to make real-time decisions about how best to nurture the brand relationship with different customers.

“Lifetime value is an important metric, but for something to be actionable for our team, we can’t sit and wait for several months to make decisions. We wanted to be faster,” explained Elizabeth Dobbin, Senior Director of Marketing at One Kings Lane.


The Solution:
Custora’s Predictive Lifetime Value Analysis and API 

OKL engaged Custora to leverage Custora’s proprietary lifetime value prediction algorithms. Within just days of initiating the relationship, Custora was predicting the lifetime value of every single customer – even for those customers who signed up last week.

Said Elizabeth Dobbin, Senior Director of Marketing at One Kings Lane, “Custora is fueling our predictive segmentation. If a customer spent only $500 to date but according to Custora is similar to another customer who spent thousands of dollars, we want to get in front of them as soon as possible, with the right marketing message”.

Generating individual-level lifetime value predictions, however, is only half the battle. To ensure that these CLV insights could be leveraged by everyone on the marketing and business intelligence teams, OKL utilizes Custora’s API to extract the lifetime value scores on a regular basis. This enables the company’s marketing team to have access to up-to-date information that can be applied across various business initiatives.

“We use Custora’s segmentation of high-value customers in our email marketing, promotional offers, and on-site. Instead of a “one size fits all” approach, we now look at which product categories, price points and messaging work best for every customer segment”, commented Dobbin.


The Results:
More agile, personalized marketing across all channels. Real, measurable lift

With Custora’s predictive insights, and via the Custora API, OKL was able to immediately incorporate Custora’s predictive insights into various marketing channels. 

This high-value segmentation and personalization strategy resulted in a 4% increase in incremental revenue for OKL. 

“Custora enabled us to answer the question, ‘If we could identify our high-value customers after their first purchase, could we nurture those relationships more effectively?’ Once we realized the answer is ‘Yes!,’ we’ve been able to incorporate these insights across various channels. The results have been exciting and incredibly powerful.”


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