The Ultimate Guide to eCommerce Personalization

This guide will help you understand the concepts and tactics around eCommerce personalization and learn how to apply it on your website.

Contents

What is eCommerce personalization?

Consumers’ online shopping behaviors are mostly determined by their intentions. Thus, being able to predict these purchase intentions provides a competitive advantage for the online stores that manage to do so. The act of accurately predicting shopper’s intentions and showcasing frontend objects (i.e. product recommendations, personalized content, personalized emails) on the consumer touchpoints of a webshop is called eCommerce personalization.

Are you able to showcase AI powered related products, upsell items and frequently bought together products on your online store? To get all of these and more, install Perzonalization for your store now and start your 14 day free trial.

Choice overloading is a problem commonly seen in today’s eCommerce scene. Online shoppers are being bombarded with marketing messages and come across millions of product types each time they visit online stores such as Amazon.com. When a customer gets too much information, he/she is likely to feel confused, get lost while browsing through the pages of a webshop and eventually leave the website before making a purchase. eCommerce personalization has become a solution to this choice overloading problem.

One can argue that eCommerce personalization is just a poor imitation of what great sales people already do however applying personalization on webstores is way more difficult and complicated than that. Whereas great sales people are friendly, personable, knowledgeable, convincing and can talk a customer into buying a product, eCommerce does not carry those human aspects. Online retail has got its own challenges because it is limited to presentation rather than physical interaction with the product and customer. Therefore, eCommerce personalization is like a great sales pitch, which is derived from data and represented in a visual form.

eCommerce personalization is not a poor imitation of what great sales people already do but rather a great sales pitch, which is derived from data and represented in a visual form.

What is real-time eCommerce personalization?

Understanding the intentions of the shoppers is crucial in terms of predicting their likelihood of a purchase however intentions are likely to change in subsequent online sessions. An online shopper is likely to look for ItemA on Day1 whereas she is likely to search for ItemB on Day5. In some cases, the purchase intentions do change inside an online session. The user is likely to add a product from a specific category in his cart and then start to look for an item from a totally different category inside the same purchase session. This makes real-time analysis a must have rather than a nice to have feature in an eCommerce personalization platform.

Real-time analysis requires a state-of-the-art database structure and a high performing algorithm. Thus, not every eCommerce personalization engine have the ability to work in real-time. We – at Perzonalization – have invested on creating a real-time eCommerce personalization platform and we are proud to be instantly handling millions of product recommendation requests.

Real-time analysis is a must have rather than a nice to have feature in an eCommerce personalization platform. –   Tweet This!

How to apply personalization in eCommerce?

Data lies at the root of all eCommerce personalization methods. A good eCommerce personalization tool should be able to gather high quality consumer data, from different touchpoints and in real-time. This data is usually in the form of clickstream and transactional behaviour however in some particular instances social data can also be used.

That being said,  data analysis method determine the performance of the eCommerce personalization efforts. There are several different technological approaches when it comes to applying personalization however a combination of collaborative filtering and content based filteringlike the one Netflix uses – is highly appreciated nowadays.

In order to achieve scale in eCommerce personalization, automation should be applied. AI powered eCommerce personalization platforms like the one we have here at Perzonalization is designed to perform complex personalization tasks in real time and with high precision. According to a survey by ForbesInsights, 1 out of 4 global marketing executives say that their companies are at the forefront of implementing AI and machine learning to personalize customer interactions at scale.

1 out of 4 global marketing executives say that their companies are at the forefront of implementing AI and machine learning to personalize customer interactions at scale.

Personalization can be applied on websites or out of the websites. Either on-site or off-site, personalization requires a disciplined practice of data capturing, analysis, processing and visualisation. Different types of consumer data – i.e. clickstream, transaction, location, social media, weather – is being captured, processed and finally showcased in the form of different formats such as;

  • On-site personalization formats
    • Product recommendations
    • Personalized campaign banner listings
    • Web push notifications
    • AI powered chatbots
    • Personalized pop-up messages
  • Off-site personalization formats
    • Email personalization
    • Personalized ads
    • Chatbot messenger marketing
    • Mobile app personalization
    • Personalized SMS
    • Mobile push notifications

eCommerce personalization examples

On-site personalization use cases:

Personalized Product Recommendations on Amazon.com

We should be speaking about Amazon’s commitment to personalizing the consumer journey if we talk about eCommerce personalization. Amazon can also be regarded as the “inventor of eCommerce personalization”, as the first personalization algorithm was developed by Amazon’s engineering team. The team at Amazon is doing personalization so right that 44% of customers are buying from Amazon’s product recommendations.

 

Web Push Messages on Roman Originals

From evening wear to day wear, casual to formal, Roman Originals is providing affordable women’s clothing and designer ladies fashion. As the company’s motto is to serve the needs of their customers via affordable yet trendy collections, Roman Originals tend to apply many discounts. To be able to announce those campaigns, Roman is using the web push notifications as a communication channel. The good thing about web push is that, most messages are being triggered by the customer behaviour, thus those notifications are personalized in that sense.

 

 

Personalized Product Recommendations on Asos.com

The fashion retail giant understood the need for personalizing the online consumer journey in 2014. Nick Robertson of Asos said “browsing through thousands of products is not what our customers want to be doing. Our customer base needs and wants inspiration so we have to do an edit that is relevant to them personally”. This is how asos.com started featuring “as seen on me” feature as well as the product recommendations and personalized product ideas.

Exit Pop-Ups on Pixel Scrapper

Pixel Scrapper is a scrapbooking community site. The website is providing downloadable templates to help digital scrapbookers. To be able to increase their conversions, the team at Pixel Scrapper decided to get help from exit pop-ups. These are the smart pop-ups that analyze the online visitor’s clickstream behaviour and understands when the visitor is likely to bounce, a behaviour which is called the “exit intent”. A pop-up is being triggered each time a visitor shows exit intent. These pop-ups can also be tied to several other online behaviour types. The good thing about these pop-ups is that; they are personalized in the sense that they are rule based and individually triggered plus displayed.

 

 

Personalized Product Recommendations on Smythson of Bond Street

Smythson sells handcrafted stationery by artisans. The products in Smythson’s portfolio can be defined as “luxury accessories” as finest details are consired during the making of those beautiful notebooks and diaries. The company aimed to increase their onsite conversions and lift average order value. That’s how they started implementing eCommerce personalization in the form of product recommendations and personalized pop-ups.

Similar Products on eBay.com

Serving as the main sales channel for many international retailers, eBay has to be cautious in its personalization efforts. “Similar sponsored items” and “sponsored items from this seller” are the two creative methods that the company has come up with. As a seller, if you want your products to be included inside the product recommendations, than you need to sponsor those recommendations blocks. By this, eBay maintains a delicate balance between its customers’ personalization needs and the commercial priorities of its sellers.

 

 

Chatbot Marketing via Domino’s Anyware

One of the most interesting examples of chatbot marketing comes from Domino’s Pizza. Domino’s is not just limiting the chatbot usage to its website but on the contrary it uses multiple channels to apply  “smart ordering”.

Domino’s Anywhere gives pizza lovers the power to order their favorite from a multitude of channels including Slack, Messenger, and even Alexa. This is not what we would typically call a “personalized” or “smart” approach but the ease of use for the customer is enough to make its customers happy 🙂

One of the most interesting examples of chatbot marketing comes from Domino’s Pizza in the way the company uses multiple channels to apply  “smart ordering”. –   Tweet This!

Off-site personalization use cases:

Email personalization on Mavi.com

Mavi, a global lifestyle brand with strong denim roots, had been successfully applying loyalty card practices for years on their brick and mortar store when they came to us – Perzonalization. Increasing loyalty and sales via personalization activities on their online storefront was a challenge which we successfully tackled.  The company used Perzonalization’s AI powered and real-time eCommerce personalization platform to apply eCommerce personalization on desktop, mobile app and automated emails.

Personalized ads by LA Girl and Interspot

There are many studies showing that “relevant” ads increase engagement and purchasing. Adlucent’s study is a good example. The study shows that seven in 10 consumers yearn for personalized ads. However, collecting data to be used in personalized ads and using this data to come up with AI powered and personalized ads that will be relevant for the online shoppers is still a challenge.

In most cases the only “ad personalization” is the one that includes the name or the picture of the individual shopper. In some cases, “targetted advertising” is showcased as the most “sophisticated” advertising personalization method but this is merely an underestimation of artificial intelligence’s skills.

AI is perfectly capable of serving truly unique ads to every individual – both in terms of the ad visuals and the products/services included in the ads. However, in today’s advertising world, we still do not see many AI powered and personalized ad examples.

Although not being very “smart”, dynamic landing pages have been a quick-hack when it comes to personalization. Ads powered with dynamic LPs work like this; the online user sees a targetted ad, lands on a website where she is met with a semi-personalized landing page. The same landing page is showcased to visitors with different and personalized content i.e. text, videos and visuals. So in theory, if x users are seeing the ad, x different landing pages can be served.

In some cases, “targetted advertising” is showcased as the most “sophisticated” advertising personalization method but this is merely an underestimation of artificial intelligence’s skills.

Two great examples of personalization in AI powered advertising come from online retailers LA Girl and Intersport Finland. These companies use Criteo’s avertising platform to streamline their ad personalization processes. Criteo’s dynamic ads re-engaged customers who’d left the site, encouraging them to convert with product offers personalized to each individual.

Chatbot messenger marketing by Sephora

Many online retailers started using chatbots on their web channels, Facebook Messenger and via SMS marketing. Sephora used a chatbot called Kik to welcome the new customers and learn about their individual taste preferences with a mini-quiz.

Mobile app personalization by Hopi

Hopi is a mobile platform that provides personalized shopper experiences from various brands. As the consumer data is being captured towards both online and offline channels across several retail brands, it was a challenge to apply personalization on the user interface of Hopi app. At this point we – Perzonalization – came on stage and executed eCommerce personalization activities on behalf of Hopi. The personalized product recommendations on Hopi mobile app is attracting 20% of the consumer traffic.

Push notifications by Laredoute

Laredoute one of the largest ecommerce apparel retailers in the world. The company specializes in French-style fashion and carries a huge inventory, a feature which makes it a perfect playground for personalization in eCommerce.

As for the other online retailers, Laredoute has got a big problem; the abandoned carts. The solution the company finds is to start sending push notifications to their mobile app users each time a user left an item in the cart. The users are receiving highly personalized push notifications along with links pointing to their carts where they can complete the purchase. With the help of this tactic, Laredoute is able to realise 2-3 times higher CTR than the one on the classic mobile ads.

 

Benefits of personalization in eCommerce

Personalizing the consumer journey helps online retailers in many ways, some of which can instantly be quantified reported via a customer panel/dashboard. Some of the benefits can be listed here;

  • Increasing conversions
  • Improving customer engagement
  • Reduce the workload of marketing team
  • Increasing average order size and value via upsells
  • Reducing bounce rates
  • Driving repeat purchases
  • Increasing retention and customer loyalty
  • Creating positive word of mouth around the brand
  • Being seen as an “innovative” brand
  • Boosting revenues

Fashion eCommerce personalization

Most of the trends in fashion eCommerce points us towards the growing importance of personalization in eCommerce. Fashion brands have always been innovative towards the way they handle technology thus personalization is no exception.

With the help of AI powered applications, fashion retailers have started using personalization as a service and benefiting from the usage of both on-site and off-site personalization. It’s not surprising to see many good personalization executions to come from fashion brands.

eCommerce personalization trends

Artificial intelligence and virtual reality can be said to be shaping up the trends in personalization for eCommerce. AI powered chatbots that do not only communicate with the users via fixed messages but can form personalized responses will be the need of the hour. VR powered virtual fitting rooms will also be helping the online shoppers.

Data will still be the king in eCommerce! Providing new product offerings based on the customers’ preferences, budget and style will help online retailers gain competitive advantage and increase loyalty.

eCommerce execs will spend more time trying to understand ways to capture more data in a better way. They will tend to work with vendors that will increase their organization’s data capturing and usage capabilities.

What is an eCommerce personalization software?

An eCommerce personalization software is a tool, which enables your eCommerce website to render personalized content to cater to the preferences and requirements of your customers. This kind of a software can be developed internally by an online retailer however this kind of a project will take months (or years in some cases) and will eat the organization’s resources.

Thus, an expert solution like the one we have here at Perzonalization can take the personalization burden out of the shoulders of eCommerce execs, can easily get integrated, can work and deliver high ROI in real-time. So, rather than trying to create an internal personalization platform, eCommerce companies can choose to work with an expert eCommerce personalization software. This kind of a tool will help eCommerce professionals sit back and relax while revenues are being automatically boosted.

Key Takeaways

If you are reading this post, then you should be curious about what eCommerce personalization is and how your organization can benefit from this approach. eCommerce personalization has surely brought money on the table and is here to stay. So for sure, it is never too late to start investing on personalization. As it is a high ROI solution, there is no risk of spending the money for a lost-cause.

Ready to learn how we can help you? Schedule your call with an eCommerce personalization expert now!

Curious to learn more? Take a look at related posts!

 

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Ali Selim Aytuna

Co-founder @Perzonalization, Problem Solver, Maker by Heart, Nature Lover