British retailer Marks & Spencer has acquired the intellectual property, including the source code and algorithms developed by personalised fashion marketplace Thread to accelerate its personalisation capabilities.
In a statement, M&S said that the acquisition will allow it to integrate “cutting-edge proprietary tech” into the M&S website as it looks to accelerate personalisation and deliver a unique customer experience. The personalisation capabilities will stretch across all clothing products available on M&S.com, including the retailer's third-party brand partners.
The move comes as M&S states it has generated substantial value through its customer data, personalising offers and product recommendations in recent years, and it is expected that 20-25 percent of all digital interactions will be personalised this year.
Outfit recommendations have proved to be valuable for the retailer and it estimates that the ‘frequently bought together’ recommendations are worth an incremental 20 million pounds in revenue over the last 12 months. A figure it expects will increase to more than 100 million pounds of annualised incremental revenue for the business in the coming years.
Thread founders join M&S as the retailer acquires the marketplace’s intellectual property
Katie Bickerstaffe, co-chief executive at Marks & Spencer, said: “The acquisition of Thread is the perfect example of a ‘buy not build’ approach – enabling us to accelerate our personalisation strategy by integrating the market-leading tech on M&S.com in under 12 months. We’re taking personalisation to the next level to inspire our customers with tailored outfit inspiration.
“We have been working hard to deliver better, more stylish ranges and this algorithm will also put more of our great product in front of the customer, whilst further unlocking the potential of our third-party brand strategy, by adding outfit completing product ideas. We already know the incremental value personalisation can bring and we anticipate that personalisation will generate more than 100 million pounds of annualised incremental revenue for the business.”
Following the administration of Thread, M&S added that it is hiring 30 of its former data scientists, software engineers and styling and creative teams who will lead the integration and form a new personalised discovery team, within its data and digital function. This includes Kieran O’Neil and Ben Phillips, who founded Thread in 2012.
O'Neil, who will join M&S as senior head of product, added: “We have worked for the past 10 years on building the most advanced AI personalisation for online fashion, proven to increase customer conversion and repeat orders. We’re so excited to join forces with M&S; through their infrastructure and support, we’re able to take our market leading technology to the next level, providing a personalised and unique shopping experience for their 30 million customers.”