If an online store could guess what you were thinking as you browsed their site for goods, would they make more money off you? The wave of predictive analytics software that’s been sweeping e-commerce suggests it would, and two of the biggest companies in the field have put their money behind a start-up that claims to be at the cutting edge of predicting shopper intent.
The company founded by brothers Jay and Meelan Radia -- who started a remarkable 13 other companies before Yieldify -- claims public case studies of clients that demonstrate a 979% return on investment for using its software,. Yieldify doesn’t make money from subscriptions like many a SaaS company, but by taking a percentage of sales.
So-called conversion optimization has been around for more than a decade led by large players like Omniture, but newer attempts in the field have used A/B testing tools to help funnel shoppers into categories, and a more filtered, personalized shopping experience.
Yieldify, for instance, might tempt a shopper with a voucher if it looks like they have put products into their online shopping basket, but are about to log off. The effect is to rescue the shopping basket.
This combination of big data and behavioral science is sometimes called hyper personalization, where websites put their visitors into finer and finer categories, and become better tuned to how we intend to shop.
The startup counts more than 1,000 companies with an e-commerce presence as its customers including
Founded in June 2013, Yieldify quickly became profitable in the second half of that year. After setting up an office in New York last year the founders were approached by multiple venture firms, before taking money from London-based Hoxton Ventures and Index Ventures' Robin Klein for a seed round, and then this year picking Softbank and Google to lead their Series A round.
Technically the company doesn’t need the cash as it’s been “very profitable for about a year,” according to one early investor. But having Google Ventures and Softbank on the roster will make it easier to attract stronger talent as Yieldify hires more data scientists.
Softbank’s investment was carried out by its New York-based venture arm, led by Joe Medved, while Google Ventures’ investment was led by general partner Avid Laziradeh Duggan. It marks one of the first major investments Google Ventures have made in the U.K.
