E-Commerce Solutions

BloomReach Stretches For Smarter Online Buying

Buying products on the web may have changed from being a static, clunky phenomenon to a more dynamic, mobile-friendly and generally all-round more impressive experience, but there are still rough edges.

Recommendations can be duff, search terms unhelpful, finding the best deals a challenge despite the best efforts of waves of e-commerce firms that have been flavour of the month. One company currently creating some buzz in the space is BloomReach, a five-year-old Californian company that is just expanding internationally after collecting about 130 US customers including foodie store Williams-Sonoma, office supplies giant Staples and fashion retailers Guess and Forever 21.

“We’re trying to rethink relevance on the internet and the core problem of consumers going on the web and struggling to find what they’re looking for,” says BloomReach CEO Raj De Datta when we meet in London, England where the company’s new office has just opened.

The answer he proposes is BloomReach’s “personal discovery platform” that analyses content and buyer behaviour using Big Data engines to provide retailers with counsel on what content to use and tweak to attract users, based on information mined across online retailers.

With 185 staff and “tens millions” of dollars in annual revenue, De Datta reckons his company’s success has been built in part on avoiding the temptation to shadow Google.

“A lot of search marketing agencies are trying to figure out what Google’s going to do,” he says, “but what’s more important is what visitors are seeking and knowing what content will attract them and keep them there to buy.”

Rather than second-guessing Google, De Datta says his company in some ways does a similar job but where Google crawls the whole web, BloomReach focuses on retail sites. Not coincidentally perhaps, a smattering of staff including the company’s CTO are ex-Google.

The company’s offering is a cloud/subscription-based enterprise software-as-a-service offering. It demands high ongoing spend to stay up to date with what sites are doing and BloomReach spends an extraordinarily high 50% of revenue on R&D, De Datta says. (BloomReach has raised $41m in VC and could go to the funding well again in 2015, the CEO says.)

This space has often been the victim of silver-bullet promises that are later undermined by the sheer complexity of the task at hand. De Datta though is surprisingly mild and he believes that we are still at the “primitive stage” of e-commerce:

“Fifteen years ago Yahoo was dominant and it looked like a directory: they basically tagged every web page in the world. Google came along and said it should be a single box that’s personalised with machine learning and consumers quickly became conditioned to like the Google experience. But that might not be representative of the future. Voice input, visual search, app-driven, online/offline hybrids… you can think of a lot of vectors by which the world could change.”

But there are some signs of maturity and rationalisation.

“Global e-commerce is becoming more concentrated, rather than less,” he says. “The rich are getting richer and the long tail is getting shorter. But with globalisation, the scale and opportunity is 10 times greater.”

With the rise of global sourcing and the transparency of mega markets like Alibaba, there have inevitably been fears of a race to the bottom, but De Datta sees retail continuing to be differentiated by classic issues: quality products, attentive service, value, the insights and experience of merchants and value-chain partners. 

“We can help to turbocharge your business but it’s not a cure-all. If you don’t have differentiation, a brand or competitive price point or compelling service experience BloomReach is not a panacea.”

But with physical retail under huge pressure and giants like Amazon casting their shadows - new research conducted by Redshift on behalf of BloomReach suggests more than four in five UK consumers see it as the leader in web personalisation -  retailers are being forced to justify their existence at every turn. The company that can become the connector between consumers and the hugely complex back-end systems at e-commerce sites will be very powerful companies indeed. BloomReach is making its play.


Martin Veitch is Editorial Director at IDG Connect


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Martin Veitch

Martin Veitch is Contributing Editor for IDG Connect

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