Personalization is at the heart of many retailers’ business roadmaps, topping the list of business priorities for 2018, according to a recent report. But there’s no point embarking on a personalization strategy just because ‘everyone’s doing it’. Any impactful program must improve the shopping experience, encompass every stage of the customer journey and produce tangible results for the retailer. This means gaining a broad, deep insight into shopper behavior; something which is now possible at scale thanks to advanced personalization platforms.
Despite their availability, a large proportion of businesses are failing to take advantage of these personalization solutions. A report by Boston Consulting Group found that while 20% of businesses surveyed are experimenting with one-to-one campaigns, only 13% say they deploy truly customer-specific messages and only 7% manage integrated tailored communications across all channels.
There’s clearly room for improvement. As such, I’ve outlined a couple of key considerations – listed below – to help retailers make informed decisions about future strategy, and capitalise on the capabilities of the most advanced personalization platforms.
Personalization is a Science
Personalization is about intelligent data gathering, analytics, and action. Amazon pioneered this approach: back in 1999 and then primarily a bookseller, the website recommended items to shoppers based on data gathered from past purchases. This strategy has clearly paid off, with Jeff Bezos recently revealing that the number of Prime members now tops 100 million.
But personalization has come a long way since then, and the enabling technology is no longer accessible only to the likes of Amazon. Just look at the success of luxury marketplace Farfetch, which launched personalized recommendations in 2015, and saw conversions increase by 125% for those shoppers who interacted with these recommendations. The retailer has gone from strength-to-strength since, generating revenues of $385 million in 2017, a 59% increase on the previous year.
Those looking to replicate similar success should look to a personalization platform which identifies and addresses shoppers on a one-to-one basis, gathering both historic and real-time data at every stage of the individual shopper’s journey. This approach can also be taken one step further, by choosing a platform which can monitor in-the-moment activity to predict future shopper intent. Giving the shopper what they want before they know (or realize) it, is the future of personalization.
Look for a vendor with a track-record in data science, and which has the algorithms necessary to truly understand shopper behavior, click by click, action by action. This is the science, the ‘secret sauce’, of personalisation.
…and an art
A comprehensive approach to personalization should combine science and art. The ‘art’ is that intuitive, human understanding of the shopper, and the kind of approach which traditionally is only delivered via the in-store sales person. Human-to-human interaction involves the store assistant having a pre-existing knowledge of a customer, talking to them when they come into store, observing their browsing activity. Importantly, interaction and engagement are delivered at the most opportune moments, creating cross-sell and up-sell opportunities, and helping to boost sales conversions.
Let’s take the example of a shopper browsing her local hardware store. The sales assistant knows the shopper – a regular – welcomes her by name and observes her movements around the shop floor. The assistant notices her add a tin of paint to her basket before heading to the checkout. En route, the assistant engages the shopper in conversation, notes the color of the paint, and acknowledges that the shopper has bought a set of paint brushes yesterday (making it unlikely she’d need a second). The assistant knows the shopper usually only buys two items per transaction, unless costs can be kept low, so recommends a paint tray at full price, and masking tape on special offer. The shopper is happy, and buys all three!
Even shoppers themselves admit that personalization affects their buying behavior. Eighty-five per cent say that personalization has at least some impact on what they purchase, with a quarter saying it significantly influences purchase activity, according to a 2017 report.
Today, thanks to automation and advanced personalization solutions, this one-to-one sales assistant approach can be achieved at massive scale. Platforms, rather than people, can deliver the most contextually-relevant experiences to millions of shoppers simultaneously, in real-time. For example, recommending products based on individual (rather than segmented) shopper behavior, or curating content on a homepage based on an individual shopper’s preferences, rather than those of a certain demographic.
An All-in-One Approach
If a retailer’s channels, departments and technology operate in silos, its customer experience will be equally disjointed. ‘Channels’ should be invisible to a shopper, and a shopper should enjoy a unified experience as they browse and buy, and move from mobile, to desktop, app and in-store. Shoppers engage with retailers on an average of 3.5 touchpoints before they make their purchase. Each of these touch points must deliver the same, seamless, tailored experience.
A personalization platform should act as the glue that holds all this together. It should join the dots between different types of shopper data (preference, location, demographic etc.), assets (products, content, ads etc.) and channels (web, mobile, email, contact center and in-store).
It must deliver orchestrated campaigns across a retailer’s entire technology stack, so the benefits of a personalization strategy can be felt by the business as a whole. Simply limiting personalization to product recommendations is no longer enough: search and discovery, content targeting, and emails and remarketing must be optimized. And the only way of achieving this is with a feature-rich, all-in-one solution.
There’s a lot of confusion in the marketplace today, making it difficult for retailers to make informed decisions. Retailers must seek a vendor which has proven experience in delivering tangible results. Personalization must be their bread-and-butter, rather than a business side-line. Finally, they must be able to offer the kind of advanced capabilities which will elevate the shopping experience and differentiate a retailer’s offering.
Advanced personalization in ecommerce is a blend of art and science, and the right technology can enable this. The perfect platform should operate across a retailer’s entire IT stack, link every touch point, and deliver individualized experiences throughout the entire life-cycle of the shopper journey.
Meyar Sheik is CEO at Certona