Slides from a talk at the Bensadoun Retail Initiative at McGill

1. Personalization and Retail
Brad Klingenberg, Stitch Fix
brad@stitchfix.com
Fashion Retail Conference
Montreal | April 2018
Lessons from Stitch Fix

2. Themes in retail
● The bar for personalization is rising

3. Themes in retail
● The bar for personalization is rising
● Competing on anything other than price and logistics
requires offering something more

4. Themes in retail
● The bar for personalization is rising
● Competing on anything other than price and logistics
requires offering something more
● Data science makes it possible to know your clients at
scale

5. Knowing your clients
Three lessons from Stitch Fix
Lesson 1: Feedback loops unlock personalization
Lesson 2: Client incentives matter
Lesson 3: Data (science) enables personalization at scale

6. Personalization
at Stitch Fix

7. Stitch Fix

8. Stitch Fix

9. Stitch Fix

10. Stitch Fix

11. Styling at Stitch Fix
Personal styling
Inventory

12. Styling at Stitch Fix: personalized recommendations
Inventory
Algorithmic
recommendations
Machine learning

13. Styling at Stitch Fix: expert human curation
Human curation
Algorithmic
recommendations

14. Lesson 1: Feedback loops unlock
personalization

15. Two categories of data
Things clients tell us about themselves in general

16. Two categories of data
Things clients tell us about their experience

17. Learning through feedback

18. Learning through feedback
Better
recommendations
Better inventory

19. Example: Evolutionary clothing design
“Hybrid Design”
A -
body
B -
sleeves
C -
color
D -
print

20. Lesson 2: Client incentives matter

21. You need the data!
Personalization depends on knowing your clients

22. Broken feedback loops
Why don’t traditional retailers have this data?
● They don’t know they need it?
● Their clients have no good reason to give it to them
Recall, the bar is high. You want to know every client!

23. Broken feedback loops
?
Weak or missing altogether
Unclear what the customer thinks about what they bought, much less others items
https://openclipart.org/

24. You need the data!
The best way to get data from your clients is for them to want to give it you!
Compelling self-interest drives feedback loops
● First order benefit (very compelling): your experience gets better!
● Second order benefit (less compelling): your feedback helps Stitch Fix /
other clients

25. You need the data!
Reduces the need for “out of channel” feedback
Survey Enter to
win!
https://openclipart.org/

26. Data collection as engagement
Providing information can be fun!

27. Lesson 3: Data (science) enables
personalization at scale

28. A long history of personalization
In some ways, personalization is old-fashioned
http://cliparts101.com/

29. Scaling personalization
But how do you scale this?
And, we want more!
● Uniformly high quality
● Virtuous cycles and feedback
● Iterability
http://cliparts101.com/

30. Technology and data science
Having the data is not enough - data science is required to bring it to life
Algorithms are
● iterable
● testable
● replicable
http://openclassroom.stanford.edu/

31. Technology and data science
Having the data is not enough - data science is required to bring it to life
Algorithms are
● iterable
● testable
● replicable
A / B

32. Having the data is not enough - data science is required to bring it to life
Algorithms are
● iterable
● testable
● replicable
Technology and data science
Algorithmic
recommendations

33. Bonus Lesson

34. Data isn’t our product, but it’s our business

35. Let the data scientists out of the lab!
Using data to run a business
What are we optimizing?
How should a business make tradeoffs?
Making decisions in the presence of uncertainty
How do I tell if this is working?
https://www.evanmiller.org/bayesian-ab-testing.html

36. Thanks!
Questions?
brad@stitchfix.com
http://algorithms-tour.stitchfix.com/