Exclusive: RichRelevance, a company that powers personalized shopping experience for online retailers, has raised $20 million in funding led by Crosslink Capital with Greylock Partners, Draper Fisher Jurvetson and Tugboat Ventures participating. This brings the startup’s total funding to $50 million.
RichRelevance aims to take consumer shopping data and help retailers leverage this information into a more personalized experience. As e-commerce heats up, and big data strategies enter the market, more retailers want to provide customized online shopping for consumers to drive sales.
The company was co-founded by Sundeep Ahuja Tyler Kohn, Michael DeCoursey and Dave Selinger, who helped architect Amazon.com’s recommendation technology. Selinger tells us that in his additional experience at Overstock.com as Vice President of Software Development and Data Mining, he saw how challenging it was for retailers to use data to give consumers a better experience. And at Amazon, where Selinger helped lead the research and development arm of Amazon’s Data Mining and Personalization team, he was able to see the potential value in delivering a personalized UI.
“It’s hard for retailers to get an arm around different data sets and I wanted to help retailers leverage data to make the shopping experience better,” he explains.
RichRelevance offers three distinct ways retailers can add personalization. The first allows retailers to deliver product recommendations via email, or even as users are navigating through the site. RichRelevance takes all forms of consumers, data, including what items you may have licked on, purchase history, shopping cart history, search, and more to help personalize the shopping experience. RichRelevance serves more than 350 million personalized recommendations each day across its merchant networks.
For example, a retailer using RichRelevance could send an email to a consumer with suggestions of what they may like based their interactions with the site, or previous purchases. As Selinger explains, “The goal is to recreate the personal, consumer experience you have with a sales representative in te digital channel.”
The second product RichRelevance offers is focused on personalized advertising. The company will present relevant advertisements to consumers while shopping on retail sites. So brands such as Colgate can deliver an advertisement to a consumer in the midst of making a decision about what’s the right toothpaste. Selinger says the value proposition is similar to ad network. Launched in December 2010, RichRelevance’s advertising offerings are used by 3M, P&G, AT&T, Verizon, Toyota and Cisco. The company claims that these ad products can deliver a 60-100% sales lift for the advertised brand’s products.
Personalized offers are the final product the company integrates, and serves consumers targeted promotions.
In aggregate, RichRelevance’s clients represent more than 30% of online retail and today the company serves six of the top 10 US retailers in ecommerce, as well as seven of the top 50 leading UK/EU online retailers. Customers include Target, Walmart, Sears, Overstock, The Disney Store and others.
The new funding will be used to further develop RichRelevance’s product footprint, expand markets internationally and for research and development, says Selinger.
David Silverman, Partner at Crosslink Capital, tell us that the company has been able to see success because it is a technically savvy business that has taken advantage of a pop in e-commerce. “The innovation level of what RichRelevance is doing is exponentially better than competitors,” he says. “The company has the best technology algorithmically.”
“Data is the currency in today’s omni-channel retail environment,” said David Strohm, partner at Greylock Partners. “Companies like Apple, Google and Facebook have set the stage for what it means to use data to attract and maintain loyal customers. RichRelevance is among this select group of platform companies who can harness data on consumer behavior and insights, specifically shopping and intent data, to change the way that retailers and brand advertisers operate.”
As the e-commerce world becomes even more competitive, retailers are going to have to use their data to help deliver a more valuable experience. And the way to do this is through personalization. Clearly, RichRelevance is in a potentially lucrative position to be one of the go-to technologies to enable this for retailers, who may not be technologically savvy to manage and parse this data into an actual product.