Overstock.com

Objective

Internet retail giant Overstock.com was incurring unnecessary expenses due to inaccurate and incomplete customer data provided by customers during checkout. The bad data resulted in wasted time, money, and unsatisfied customers.

Solution

QAS Pro Web was implemented in Overstock.com’s checkout process to verify customer addresses, automatically correcting minor mistakes and prompting customers to fix critical errors, to ensure order deliverability and improve customer satisfaction.

Undeliverable orders have dropped and customer satisfaction ratings have increased, placing Overstock.com at the #2 spot on the National Retail Federation’s customer service rankings.

A boom in online retailing highlights the necessity of clean data

Online retail has seen explosive growth in the last several years. However, as online purchasing has increased in popularity, so have back-end address correction fees incurred as a result of inaccurate or incomplete addresses provided during checkout. Customers enjoy the convenience of e-commerce but often submit seemingly minor address errors that can impact their order and result in unnecessary logistical expenses for online retailers.

Overstock.com, the Salt Lake City-based online retailer that brings outlet mall pricing on brand name products to consumers via the Internet, was incurring these unnecessary costs. Despite booming growth to the tune of $760 million in sales from more than 5 million shipments each year, Overstock.com identified a weakness in shipment delivery. Inaccurate address information submitted by customers during checkout was delaying orders, creating unnecessary costs and negatively impacting its customers’ experiences and perception of the company.

“We immediately defined the logistical costs associated with bad address data,” said Steve Tryon, SVP of Logistics at Overstock.com. The costs associated with bad addresses were easy to quantify from a shipping standpoint; however, it proved harder for Tryon’s colleagues in other parts of the business to put a price tag on the inefficiencies caused by bad data. Customer care call time, order re-processing and customer retention were all repercussions considered and used to define the overall cost of bad addresses.

“We have known that incorrect customer addresses provided during checkout have been a problem for years, but until we defined the costs we didn’t realize how serious it really was,” commented Tryon. “In 2005, we began to integrate off-the-shelf technology but didn’t have a good method of verifying addresses until purchasing Experian Data Quality tools in late 2007.”