Smart Furniture's Gentle: Online personalization tools are driving growth in furniture

           T.J. Gentle

T.J. Gentle, CEO of Smart Furniture believes personalization is the future of retail and has the early results to prove it.

The Chattanooga, Tenn.-based retailer sells furniture. Founder Stephen Culp, took the principals he learned in the Peace Corp. and applied them to furniture, developing a customizable product line utilizing early Web-based design tools.

Today, Smart Furniture applies those same principals to e-commerce, to great success. Online shoppers are being converted at approximately 10 times the rate of typical Web site visitors and order sizes are 27 percent higher.

FierceRetail spoke with Gentle about the challenges of selling furniture online, customization and personalization, and how to meet the needs of Millennial shoppers as they begin buying and furnishing their first homes.

FierceRetail: Personalization is a big buzzword in retail today, across all product categories. How does it relate to selling furniture, especially online?

T.J. Gentle: There are things people are missing about big data and personalization. Too often in the e-commerce world, personalization is backwards. Sites like Google will personalize or localize search results — sometimes it's relevant, and sometimes it's not.

Retailers have got to know their role in the value chain. In e-commerce, our advantage is an intimate knowledge of the products we sell. We came up with a method of breaking our products down to fundamental product attributes. Then we take our customers and segment them to create profiles, and within those profiles, created a corollary to the product attributes and characteristics. We developed an algorithm that allows us to make assumptions and map product attributes to customer characteristics.

We knew our product really well and we knew our customers really well. We should be able to help cultivate or curate that product offering. So often when you see personalization, it's really only relevant after someone purchases.

FierceRetail: And this is what you call your Smart Profile? How does it work?

Gentle: The idea was to create a fun customer interface to get at those core customer characteristics we think will make it easier to create an intuitive personalized shopping experience. We ask the customer some basic questions, it can be very subtle. We ask things like, how much space they have, are they in a suburb or a crowded metropolitan area?

A lot of U.S. shoppers say they want the best products and the best price, but we want to figure out if they are really price-minded or feature-minded, or are they both. We use a trigger event. If they're shopping and not finding something, a script runs and a message pops up, prompting them to answer a couple questions for better results. We give a financial incentive to answer the quiz. Once people start, the barrier to completing it is low.

FierceRetail: And you're seeing a pretty impressive conversion rate and sales lift.

Gentle: We've been working on it for more than a year and launched it on Jan. 1. We had a goal of getting a 25 percent to 33 percent improvement in overall conversions and we've far exceeded that number, in some cases by as much as 10 percent. Typically our conversion rate is 1 percent, but once they answer the questions, the overall average is coming in closer to 10 percent. Our average purchase is $700, so it doesn't take a lot to see our yield per visitor increase.

FierceRetail: Furniture is a big ticket item and often a difficult purchase to make online.

Gentle: We've been in the right place for 10 years and I'm ready for it to be the right time. Furniture is an $80 billion plus annual market and the e-commerce channel is lucky to get 4 percent of that right now. There's huge growth potential.

The bottom line is, I think it's time for one reason — Millennials. Furniture is a lifecycle-oriented purchase, usually by people in their early 30s. When you look at who these people are today, they have basically lived their entire lives on the Internet. When it comes to furniture, they will expect to buy it on the Internet like they've bought everything else thus far. The shift in demographics — this really is one of those times when furniture should see a significant amount of growth.

FierceRetail: So you're perfectly positioned for Millennials as they come into their peak home buying and furnishing years?

Gentle: We're working hard to be.