Ecommerce personalization is the process of tailoring offers, product recommendations, and content to each specific visitor based on their actions, demographics, and other data.
Personalization allows businesses to create unique shopping experiences that are catered to each specific individual. This, in turn, results in more satisfied customers and increased sales.
In this post, we’re going to talk about the importance of personalized shopping experiences, explain how personalization software works, and go over some examples of highly-effective ecommerce personalization.
Why you need to provide a personalized shopping experience
74% of consumers hate seeing irrelevant content on a website (Janrain). If you keep showing shoppers products they don’t need or care about, they’ll shop somewhere else.
Businesses that take the time to create personalized experiences for their customers grow their revenue two to three times faster compared to businesses that don’t take advantage of personalization (BCG).
According to a Monetate study, implementing personalization results in an average increase in sales of 20% (Monetate). This makes perfect sense because shoppers who go through a personalized shopping experience spend more time looking at exactly the products they need.
It’s been shown that 75% of shoppers are more likely to buy from a business that provides personalized recommendations. (Accenture) 44% of them become repeat buyers after being presented with a personalized experience. (Segment)
Personalization provides consumers with a more enjoyable and convenient shopping experience. This helps to increase repeat purchases and brand loyalty. It also increases the likelihood of impulse purchases and reduces product return rates (Segment).
How personalization software works
Personalization software uses a number of different data points in order to create a highly-personalized, high-converting experience for your visitors.
It takes advantage of data such as:
Demographic data - Personalization software takes advantage of demographic data available on your visitors, including their location, age, and gender.
Customer intent - By tracking visitors’ behavior, personalization software is able to determine what products interest shoppers.
Wisdom of the crowd - When it comes to first-time visitors, most personalization solutions take advantage of previously aggregated data on your audience to predict behavior.
Custom variables - Depending on the personalization software you use, you also might be able to set custom rules that will guide the personalization process.
1) Homepage personalization
Smart ecommerce retailers personalize their homepage for each specific visitor.
There are a number of data points you can base homepage personalization on, including customers’ gender, browsing history, purchase history, and even weather.
Very.co.uk, for example, bases their homepage promotions on the current weather. On a cold and rainy day, for example, they use their homepage to promote offers for cold-weather clothing and umbrellas.
This tactic increased the retailer’s yearly revenue by as much as £5 million (Foundr).
Similarly, the online fashion retail giant ASOS uses visitors’ previous behavior to determine the content of its homepage. Visitors who’ve viewed men’s clothing on their previous visit, for example, will automatically be redirected to the men’s section on the retailer’s website.
This saves shoppers from having to take the extra step of navigating to the correct section, and provides a more convenient and enjoyable experience overall.
Amazon, on the other hand, uses visitors’ location to determine the right homepage to show them. For example, shoppers from the United Kingdom who are visiting the .com version of Amazon will be asked if they wanted to shop at Amazon’s UK website instead.
This helps to avoid disappointing shoppers once they find a product they like but learn that it can’t be delivered to their country. It also enables Amazon to have an easier time personalizing the rest of their website.
2) Personalized search results
A lot of ecommerce businesses neglect their on-site search when looking to provide a personalized customer experience. The vast majority of on-site search result pages are sorted by relevance or popularity rather than by what’s most relevant to a specific shopper.
This is a big oversight since as much as 76.5% of shoppers state that they’d like on-site search results to be personalized (Bloomreach). Additionally, shoppers that use a website’s search function convert at almost double the rate of visitors who don’t use on-site search. (Econsultancy)
Personalizing on-site search reduces the number of clicks shoppers need to make to find the products that interest them and makes the entire shopping experience quicker and more convenient.
Forever21 knows this very well. After doing an initial search on their website, you’ll see that all subsequent searches will display results that are personalized to you.
For example, if you ended up viewing men’s clothing after your initial search, your future search results will prioritize men’s products available on the website.
Their search results also take into account brand affinity. If you tend to view products from the same brand frequently, your search results will prioritize that particular brand’s products.
3) Product page personalization
Perhaps one of the most popular ecommerce personalization trends, product page personalization involves personalizing one or more elements of your product page to cater to each specific visitor.
A popular way of personalizing an ecommerce product page involves displaying recommendations for similar or complementary products.
This is an excellent way for ecommerce businesses to use upselling and cross-selling to increase average order value and customer lifetime value.
In fact, it’s been shown that personalized product recommendations can increase the average number of cart items by 68.14%. Product recommendations can also help to improve conversion rates by up to 320% (Barilliance).
Pura Vida Bracelets does a great job of using personalized product recommendations. They display both the products the visitor previously viewed, as well as recommendations on what other customers liked on their product pages. This accounts for as much as 10% of their revenue (Shopify).
Personalize the shopping experience
Ecommerce personalization is crucial for providing a better experience for your customers. It’s also an excellent way to increase your average order value, improve your conversion rate, and generate more sales.
Are you taking advantage of ecommerce personalization? What kind of improvements have you seen after taking the effort to personalize the shopping experience for your customers?
Let us know in the comments.