The best way to improve customer quality and satisfaction is through personalization. One of the most effective ways to achieve this goal is through e-commerce because personalization not only drives loyalty and boosts sales, but also enables you to differentiate from your competition and stand out from the crowd.
Businesses have recognized that the “one-size-fits-all” approach doesn’t work anymore. In order to keep up with customer demands, you need a personalized strategy. If you don’t provide customers with what they want, they won’t come back and your profits will go down.
When your customers visit your website and make a purchase, they should feel welcomed and valued. This underscores the importance of implementing e-commerce personalization tactics in your sales and marketing strategies. We’ll explore what e-commerce personalization is, its necessity, and a few places where you can implement it.
What is e-commerce personalization?
E-commerce personalization layers a personalized, dynamic experience onto an e-commerce site to help users find products they’ll love. This personalized experience is determined according to user data and analytics like demography, behavior, source, browsing device—anything that might signify a customer’s preferences or needs.
Personalization is often successful in landing engagement with customers, as shown by an increase of 10-15% increase in conversion rates and a 20% increase in customer satisfaction rates. The primary goal is to provide good customer service so that customers are satisfied and the business thrives. This cost-effective growth strategy isn’t just sustainable – it also costs 5-25% less than other traditional methods of acquiring new customers. You’d shift your focus and efforts from acquiring to retaining current clients as you go on building a long-term relationship with them. This builds brand-and-customer loyalty, guaranteeing revenue as customers visit your business repeatedly for their purchases.
Why is personalization important in e-commerce?
Personalization can be a powerful tool for e-commerce businesses. It ensures that the personalized offers made to customers are both relevant and interesting. Furthermore, an Epsilon study concluded that 80% of shoppers would prefer personalized experiences with brands. And this is not the only study to have found this data. Many studies show customers have indicated time and time again, that their personalization is an essential factor when it comes to customers purchasing and revisiting a brand.
What is the difference between personalization and customization?
It’s hard to know when the words ‘customize’ and ‘personalize’ get used interchangeably. They do have some similarities, but they are not identical. Customization is often when a brand lets customers personalize their products to create their own experience- depending on what they want with the product. Personalization, on the other hand, is when a company offers its customer an experience that the customer actually wants by working with the data from the customer and any site activity analytics that has been recorded in order to provide what people want for personalized experiences.
Brand, anticipating customer needs even before the customer indicates and expresses them, can drive customer loyalty and improve the overall business.
There are other various benefits of employing the personalization approach in e-commerce.
Benefits of personalization in e-commerce [with stats]
Personalization in e-commerce increases sales, customer loyalty, and customer retention. Creating a practical personalized e-commerce experience may seem like a complicated effort but with the right tools and tactics, it will be easier to achieve. These efforts are not wasted, as 45% of consumers are more likely to buy from an online store that offers personalization. Here’s what you need to know about the benefits of personalization in your e-commerce store:
(Source for the statistics presented in this section)
Better sales conversions
The e-commerce experience for a potential customer may visually be the same for everyone else, but when visitors browse through your site and decide if they want to purchase something, they can’t just have the same boring experience as everyone else. With personalization, you can make sure their experience is what they’re looking for. By appealing to the individual’s needs and providing a relevant experience, you can significantly increase conversion rates by predicting what they’re looking for before they make a purchase.
Tactics like personalized product recommendations help brands further highlight the products that a specific group of customers is likely to buy or increase conversion rates for items that may not be popular. This works as 56% of online shoppers will return to a site that recommends products based on their activity as it cuts down on their time spent browsing.
Improved brand engagement
One way to better engage with your customers is by customizing the experience and highlighting their interests. Providing a personalized experience will help you improve how they interact with your brand, as well as how often they come back. The customization makes customers feel engaged and entices them to interact with your brand because they get to see the products in their preferred way.
Increased customer loyalty
Personalization for your e-commerce site can increase customer loyalty! By knowing what your customers want, you’re able to present them with exactly what they expect and reward them with new products and discounts in return. Your customers are more likely to be loyal and stay loyal customers even if you encounter competition.
Enhanced customer experience
A customer-centered experience is a key to success for online retailers. It makes your customers happy, which in turn can lead to higher conversion rates and increased revenue for your business. By using personalization, brands can offer customers products that are based on their particular preferences, as well as discounts and promotions ahead of time without having to assume what would be most attractive to that particular customer. Almost 53% of online shoppers say personalized stores make them return more frequently because they know they’ll find what they want.
A better understanding of customers
E-commerce personalization is more than just improving the customer experience, it helps the brand understand its customers better. To provide the optimal personalized customer experience, the brand has to get as much information as possible, like the location of their customers, the types of products that the customer enjoys purchasing (ones that they do not), and the categories they often like to purchase from. All this information and data can be advantageous, it can help the brand determine which products to manufacture more and which ones to stop selling.
Although it may present a moral dilemma against customers’ privacy as businesses have access to information about their customers, 57% of online shoppers are comfortable with sharing personal information as long as it serves their benefit. And 77% of online shoppers would trust the business with information if the company clearly stated the purpose of collecting data and how they plan to use them.
If you’re using e-commerce personalization and your competitors are not, you’ll have an edge over them. The personalization approach allows you to distinguish your brand from the others and prove yourself a store that customers will love. Customers have a wishy-washy way of shopping, so they can easily change their minds in a matter of seconds. But if you give them a more personalized customer experience that can’t be found anywhere else, they may stick with your store and even advocate for it.
Elements to personalize in your e-commerce store.
With the correct technological solutions, e-commerce personalization becomes an easier task.
Some technical constraints may only aid you in achieving a basic level of personalization, such as sending personalized emails for campaigns or personalized messages to remind them of running promotions. But now, technology has advanced to such a level that delivering personalized content at all points of the customer journey has not only become easier but also effective.
Here are some personalized elements you can input in your e-commerce online store
Localized and targeted content
Having content tailor-made for your specific region, language, interests and demography will help ensure that your customers want to return. Content includes the homepage banner, product descriptions, and blog posts.
The Content Management System (CMS) for your e-commerce site can offer discounts to customers on products that they have previously purchased. Using the same you can also create a set or bundle of related products (based on the customer’s previous purchase) to sell at a discounted price, lower than what the customer would’ve paid if purchased individually.
These kinds of target discounts are very well-received. Keep in mind and ensure not to bombard your customers with constant offer emails and messages.
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Leverage intelligent product-detail page recommendations
The best way to make more sales online is to create an upselling system with high-priced but complementary products on the product detail page. This way, shoppers are always being offered items that are in line with their product interests and budgets. And as a result of this dynamic, these types of upsells tend to have the highest conversion rates.
Retarget in-session based on behavioral triggers
On-site retargeting solutions are a great alternative to expensive and tedious off-site retargeting solutions. The key to achieving using pop-ups intuitive manner and not in an intrusive way.
You can accomplish this by triggering the pop-up offers to match the actions and behavior of an in-session, currently browsing visitor. You can also trigger them automatically based on the number of sessions, browsing behavior (both real-time and historical record), cart value, etc.
For first-time visitors, you can give them an exclusive discount in exchange for their email.
Integrate user-generated content across your funnel
You can add another dimension to your e-commerce online store by integrating user-generated content across the funnel. You can post the photos, videos, reviews, and testimonials that your visitors share either on the site or on social media so that the visitors can see the product being used in real life. An additional advantage is that visitors are likely to purchase influenced by peer-based evidence.
Do remember to share and integrate user-generated content throughout your on-site funnel, from product pages to sharing on social media.
Automate three personalized email and SMS types
You can engage with your shoppers on a personal level by connecting and converting them if they give you their email ids and/or mobile numbers. You can use these channels to maintain contact with your customers, re-engage and help them stay in touch.
There are three types of personalized email and messages you can share with your customers:
Order follow-up message
You’ll want to send a follow-up message to your customer after the checkout process. After their purchase, you’re now building your relationship with them. By checking in with them and providing tailored advice on your products related to their browsing history and previous orders, you can send customized content that they’ll appreciate.
Abandoned cart messaging
These are some of the strategies you can use to limit cart abandonment, but they will never be eliminated entirely. Shoppers get distracted and they might want to buy the product a little later on another day—or they could just leave the website. In order to help those customers, simply send them an email or message sometime after their visit that features their abandoned items and you’ll find more shoppers coming back to complete their purchase.
“We miss you” messaging
If your shopper forgets their cart, you can send them a “we miss you” message to gently nudge them and remind them. This is to re-engage with visitors and also announce discounts and new and existing products that are similar to their interests and browsing patterns.
Create personalized best-seller lists to drive click-throughs
The best products will always be well-received by your audience. By sharing a curated bestseller list that reveals trends in your store, you can create a new connection with your customer. You can show the most popular items of the month or across time, and identify them based on data analytics. After you share this list with your customer, you’ll see how it positively impacts engagement levels. Or if you’re looking to experiment with this approach, try adding dimensions like showing the most reviewed items, location-wise, style-wise, or based on sales.
Time social retargeting with smart recommendations
Social media is another way you can reach potential customers who have been on your website in the past. A successful retargeting approach can be achieved by timing it right. Social Proof makes a site visit valuable – so the value declination is proportional to time spent not interacting with your site. Calculating this allows you to save money and retarget them on social media in order to convert them, bringing in more sales!
Show continuous shopping for returning customers
Netflix is a pioneer of this tactic. The “Continue Watching” feature is a game-changing one and recreating that effect can exponentially improve your e-commerce personalization approach.
Netflix allows you to pick up right where you left off, with a simple click. This helps the viewer save time on searching and browsing through the content trove.
You can use a similar approach where you can optimize your site to remember the visitor’s selected items and preferences through previous purchases and sessions, making it easy for them to pick up right where they left off. It will create value as it makes the visitor experience easy.
Upsell, cross-sell, & downsell at (& after) checkout
One of the best ways to generate sales through e-commerce personalization is by targeting upsells, cross-sells, and downsell both at and after checkout.
Although these techniques are similar, they are slightly varied to boost the customer’s average order value.
- Upselling is suggesting products to customers that are more expensive than the items they have purchased or have in their cart.
- Cross-selling is displaying items for sale that are related to the products the customer previously purchased to find interesting while browsing through the site, regardless of their price.
- And down selling is suggesting products that are less expensive than the ones purchased by the customers or have selected for their cart.
These transactions often occur during the checkout/shopping cart part of the journey, or should also be presented after checkout. Or this could be used to target even before checkout when the customer is adding their selected item to the shopping list. These are prime times because the customer is about to make a purchase that excites them, they already have their cards in their hands, so they are more likely to purchase more items similar to the ones they have decided to order.
A great application of this tactic can be seen with Amazon where they show related products to what’s already added to the cart
Amazon focuses on leading the customer to make larger purchases, no matter the pricing, based on their interests and the selected items. Therefore this works towards boosting the customer’s average order value.
Tools to help tailor the Personalized Experience
Wondering what tools can help you tailor that personalized experience? We’ve collated some of the best tools that can offer a wholesome e-commerce experience on your website
Customer Data Platforms:
Here are some of the tools that allow businesses to collect, unify, and activate customer data from various sources to create a unified customer profile.
- Segment: Segment is a leading CDP that provides a unified customer data infrastructure, enabling businesses to collect, clean, and connect customer data from various sources. It offers seamless integrations with numerous marketing and analytics tools.
- Tealium: Tealium’s CDP allows businesses to unify and enrich customer data, providing a comprehensive view of each customer’s journey. It offers robust data governance and enables real-time data activation across channels.
- Exponea: Exponea is known for its affordability and comprehensive customer data capabilities. It provides a unified customer profile, personalized customer journeys, and advanced analytics at a competitive price point.
These engines use algorithms to analyze customer data and provide personalized product recommendations, increasing the chances of conversion and cross-selling.
- Recombee: Recombee offers an affordable recommendation engine that uses collaborative filtering and machine learning algorithms to deliver personalized product recommendations.
- EasyAsk: EasyAsk provides an AI-driven recommendation engine with natural language processing capabilities to deliver personalized shopping experiences for e-commerce customers.
- Voyado: Voyado offers an affordable AI-powered recommendation engine that uses real-time data to deliver personalized product recommendations and search results for e-commerce websites.
- Optimizely: Optimizely offers a personalization platform that allows e-commerce businesses to create targeted experiences for their customers. They offer pricing plans suitable for businesses of various sizes.
- Barilliance: Barilliance provides an affordable personalization platform specifically designed for e-commerce, offering features such as product recommendations, personalized emails, and on-site targeting.
- Freshmarketer: Freshmarketer is a cost-effective personalization platform that allows e-commerce businesses to create personalized experiences through A/B testing, personalized content, and customer journey optimization.
- RichRelevance: RichRelevance offers an affordable personalization platform for e-commerce websites, focusing on delivering personalized product recommendations and content to customers.