xiu_logo.jpgWestern retailers have been using data mining technology for over a decade to try to get a feel for what their customers like. China’s online fashion retailer Xiu.com has taken a leaf out of their book with IBM’s Smarter Commerce technology and has seen sales soar from 10,000 items a day to 100,000.

Whether IBM’s technology is solely responsible for that growth is probably debatable, but there’s no denying that the advent of so-called Big Data technology has made it much easier to analyse the huge amount of data that large online retail operations generate today.

The deal is, in my eyes, highly significant as it shows Chinese leading retailers in both the physical and online world are no longer content to play catch-up with western retailers in their use of retail technology, particularly when it comes to retailers like Xiu that focus on China’s aspirational middle classes.

Using the same approach that Amazon pioneered a decade ago, this Chinese online retailer can now collect and analyze significant amounts of data that show how traffic is coming to Xiu.com, which referral sources bring the most profitable customers as well as insights around customer behaviors while shopping. These Big Data insights allow Xiu.com to customize the shopping experience for each of its customers, helping to drive increased customer loyalty, satisfaction and spend.

The company now uses this data as the basis for its ongoing marketing strategy, enabling much smarter and highly targeted customer outreach campaigns.

Working with IBM, Xiu.com improved its sales platforms to better handle its growing popularity. By fully integrating its front-end systems with the company’s back-end technology and operations, Xiu.com optimised its supply chain. As a result, the company now has the capability to offer customers up to 5m products to choose from at one time, and the greater choice has boosted Xiu.com’s daily sales volumes ten-fold, according to IBM.

Xiu was founded by Ji Wenhong (George Ji) and Jin Huang in March 2008. Xiu.com sells middle to luxury brand name fashion products including shoes, bags, ornaments, cosmetics and home decor.

In 2011, Xiu.com raised $100m in funding from US PE firms Warburg Pincus and KPCB, the largest B round money raised in the Chinese e-commerce industry.


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