Personalization in Commerce: The Hidden Opportunity

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The Hidden Opportunity of Personalization in Commerce

fotomek/Adobe Stock

fotomek/Adobe Stock

Commerce today is all about experience. Delight your customers with a great buying experience and they’re more likely to become return customers.

A huge part of that is giving your customers what they want, and that’s where personalization is crucial. As eloquently stated by Daniel Clutterbuck of The Webtise Group, personalizing means giving customers “a customized shopping experience based on their interests, buying behavior, demographics and psychographics.” When you do that, customers will respond by coming back for more — and increasing your sales.

There’s big money in personalization

Okay, let’s talk dollars first. Sure, personalization sounds nice, but does it actually boost your profits?

The answer is yes. Personalization breeds better shopping experiences, which consumers are willing to pay for. Unfortunately, these experiences seem to be largely missing from the current retail landscape.

Of course, that leaves a big pile of money on the table. American retailers missed out on $150 billion in revenue in 2016 by not taking advantage of personalization, according to TimeTrade’s State of Retail 2017 survey. Furthermore, almost half of consumers surveyed said they’d spend more for a personalized experience:

personalization, retail, timetrade, sales, ecommerce, buy, sell, personalized, experienceThe results make sense: 26% of consumers say they value a personalized experience most in a retail store, second only to prompt service (at 47%). That’s surprising, as you might expect “low prices” or “product quality” to take the top spots. You can’t blame brands for being surprised too, and it’s understandable why many have missed out on personalization so far.

Personalization brings customers back

Beyond prompting customers to spend more, personalization also helps them stick around. For example, consumers like being recognized by name — it makes 56% of them more likely to shop at a retailer. It’s not so unbelievable that such a simple gesture can hold sway, either. Remembering a customer’s name is a token of appreciation. It’s a small but powerful reminder that you’re thrilled your customer came back to you instead of your competitor. Who doesn’t like shopping at a place where they feel valued?

If you take personalization a step further, you might try remembering your customer’s purchase history too. Then show them similar items they’ll love (it never hurts to take a page out of Amazon’s playbook). Consumers don’t want to start from scratch when browsing products — 65% of them are more likely to shop at a retailer that remembers what they’ve purchased before. The common sense explanation behind this? Customers like effortless shopping experiences. Through personalization, they can find products they love instead of wading through endless offerings they don’t care for.

Amazon, related products, ecommerce, buy, shop, trends, shopping

Amazon is the master at recommending related products to customers. The company reportedly generates 35% of its revenue from its recommendation engine.

Regardless of the personalization tactics you employ, the overall strategy remains the same — create a more fluid and relevant shopping experience for your customer, one that will ultimately bring you to the land of higher conversions.

The young folks like it too

We’re always talking about what the young whippersnappers are doing in e-commerce. That’s because millennials are hitting their stride both in earning and spending power, and Gen Z is hot on their tales. Needless to say, it’s always important to understand their preferences.

In the TimeTrade State of Retail 2017 survey, nearly 50% of consumers would pay more for a personalized retail experience. When you narrow that demographic to just millennials, the figure shoots up to 70%. In an age where there are many choices for just about everything, young consumers love it when brands make the extra effort to woo them.

That high touch may be paramount when Gen Z arrives in full force. According to Luxury Daily, 81% of Gen Z consumers “are willing to switch from their favorite brand if they find a similar product of better price or quality.” Keep them coming back by making it clear you understand and value them. To that end, personalizing your shopping experience will go a long way.

Curalate helps more than 850 of the world’s leading brands sell online more effectively by creating compelling commerce experiences that adapt to how consumers discover products. On average, our clients achieve: 79% increases in time-on-site, 16% jumps in average order value and 31% increases in conversion rate.

What can Curalate do for your business? Contact us to find out.

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