Last updated on
January 22, 2024
We all use Spotify (most certainly I do) and love the personalized recommendations the app gives us for our ever-changing moods. But have you ever noticed how Spotify could provide succinct and precise recommendations? There is a running joke in the Twitterverse that Spotify knows our music tastes better than us. How’s that so?
Well, Spotify uses a little personalization to suggest music that would suit our preferences.
Everyone needs to harness personalization from Bigtech to their local eCommerce store to provide a satisfactory customer experience. People want their favorite brands to recognize them and provide recommendations tailored to their needs.
So, without further ado, let’s talk about how eCommerce personalization can help you scale your business and drive revenue with the help of eight tips and a few top examples.
eCommerce personalization is when an online store uses customer data to provide dynamic content relevant to that specific customer. eCommerce personalization can be based on several factors, including, but not limited to, a customer’s purchase history, demographic or behavioral segmentation, browsing history, and the browsing device.
With personalization at the helm, businesses can draw many benefits. 91% of customers say they’re more likely to buy from brands offering personalized product recommendations.
So by taking this study into account, we can safely say that personalization is here to stay and will become a significant part of the marketing strategies of various brands.
Let’s dive into some benefits you can draw by making personalization a part of your eCommerce marketing strategy.
The benefit that stares eCommerce entrepreneurs face is that personalization helps them better understand customers. First-party data (collected by the organization) can provide valuable insights into buyer personas.
You can find out which products customers most favor, their buying motivation, and their purchasing history. You can use these insights to decide which products to continue and which to discontinue.
Exceptional customer loyalty programs reward their customers for loyalty instead of redeeming generic points.
Customers should be rewarded in accordance with the level of loyalty they show towards the brand. For example, suppose a customer has ten repeat purchases in 60 days or has an order value higher than your average. In that case, that customer should be rewarded with a considerable discount or a gift.
Successful referrals should also be rewarded. Rewarding your “advocates,” those that bring in new customers can help boost customer retention and engagement.
Personalization programs are known to improve customer satisfaction, closely tied to customer retention. In fact, businesses that successfully increase their retention rate by 5% can see their profits increase between 25% and 95%.
If you are a retailer, this type of growth is sustainable because acquiring new customers is 5 to 25 percent more expensive than retaining existing ones.
Competition among eCommerce companies is heating globally. So, to get a competitive edge over your competitors, you need to develop personalized offerings that appeal significantly to your customers when they have a purchase intent.
Conversion rate is an important metric to measure if you want a clear picture of your business's growth and whether it needs to be steered in a new direction. Personalization indeed does help in increasing conversion rates. In fact, personalization programs have been shown to yield 10 to 15 percent higher conversion rates.
So far, we have discussed what eCommerce personalization is and what benefits there are for leveraging it. Now, we move on to the personalization tactics you can deploy to improve customer satisfaction, retention, and ROI.
Product-detail pages can be the ace up your sleeve when personalizing recommendations. With smart recommendations, you can upsell or cross-sell products the customers have already shown interest in. You can suggest products that are similar in style or even by the same brand. Shopify says such recommendations have the highest margins and a high conversion rate.
This example from Amazon can serve as an inspiration for your product detail pages. If you are searching for a gaming keyboard, let’s say the “Razor Ornata V3,” at the bottom of the product detail page, you will see that Amazon is suggesting the most frequently bought mouse with the keyboard you searched for.
Moreover, below the “frequently bought” suggestion, you can see that Amazon suggests more keyboards that their algorithm thinks you might find interesting. These personalized suggestions can be based on your purchase history, interests, demography, or other factors.
Your returning customers are the main drivers of revenue growth. Moreover, satisfied customers can become advocates for your eCommerce business, bringing referrals that can help you gain more customers without spending considerable monetary resources.
So, it’s better to incentivize your returning customers appropriately. Let’s take a look at how Etsy rewards its loyal customers. In this email, they are emailing a loyal customer on behalf of CactusArchive and offering them a 20% discounted coupon code.
Let’s come back to the example of Spotify. Another reason people discover new music on Spotify is that it shows the latest releases and most popular songs at the front in its “Discover something new” section, which shows them personalized recommendations based on their app activity and interests.
eCommerce stores also can take a leaf out of Spotify’s playbook by keeping their best sellers front and center of their customers to drive engagement.
eCommerce stores must put their best sellers at the front and center of customers to drive more click-throughs and engagement.
The rise of social media has skyrocketed the popularity of user-generated content. Now, people can post reviews of their favorite products and provide social proof that brands can use to target new customers.
eCommerce brands can push customers down their sales funnels by integrating user-generated content in their funnels and take users one step closer to a successful sale.
Starbucks 2014 White Cup Contest is an example of UGC. They asked customers to draw artistic designs on their white cups and upload them on their social media profiles with the hashtag #whitecupcontest. The winning designs would then be chosen as templates for future cup designs, and the winners could also win a $300 gift card.
The result of the campaign was that Starbucks’ organic reach grew tremendously, resulting in increased sales.
Another way to personalize your eCommerce campaign stores is to set up behavioral triggers. The trick here is to be non-intrusive and intuitive with your pop-ups.
You can achieve this by timing your pop-ups to match the customer’s on-site behavior. You can trigger these popups using automation. You can choose characteristics such as browsing behavior (both historical and real-time,) the number of sessions, cart value, and other characteristics that you deem relevant to your eCommerce store.
You can target first-time visitors using exclusive discounts and promotions to get their email addresses. Moreover, you can offer discounts after someone has added items to their cart to drive order value. Here’s an example from Framebridge to illustrate this.
You can use popups to remind returning customers who have shown interest but have yet to purchase the product to complete the order. Bandier uses a popup that shows recommendations based on the particular customer’s browsing behavior.
Utilizing social media to re-engage customers can be smart if done right by choosing the right timing.
The value of a customer declines the longer they stay away from your site. So, you can employ granulated retargeting to save on ad spend by layering your ads as a customer’s value declines. You can also shorten your retargeting period to 7-14 days. This will help you in engaging customers only when they are most likely to convert.
Be mindful of the strategy you are using to approach the customers. Whether with products that are relevant to them or by reminding them of your unique selling proposition (USP).
Email automation can do wonders for your eCommerce personalization strategy. By leveraging it, you can get your repetitive emails out of the way quickly. And not just that, you can also use your customer data to personalize your automated emails, making them highly effective. Here are the five emails you should definitely automate:
Let’s face it; there will always be customers who will leave their carts abandoned because of the numerous distractions the world has to offer.
But what you can do is jog the memory of your customers with abandoned cart email reminders like these.
Leveraging automation with Mailmunch can ease the process considerably; just craft an email, design the email workflow, add an abandoned cart trigger, and schedule it to be sent at a time of your choosing. Easy!
Email automation allows you to make sure that your dormant customers are effectively targeted. You can create highly segmented email lists of customers you want to retarget and send out emails bearing offers that can jolt your customers out of their dormancy and force them to re-engage with you, or you can appeal to their emotions and ask them to reconsider their decision of leaving.
It’s critical that you should send a follow-up email right after a purchase is confirmed. Manually crafting an order follow-up email can eat into your precious time. So, automating your follow-up emails can help you save that time and be more productive in other areas of your business.
Celebrating the milestones that your customers achieve with you is equally important. With email automation along with segmentation, you can make this task quicker, easier, and more precise.
Birthday emails are another type of email you can automate. You can personalize the offer using data on the purchase orders and browsing behavior and offer gifts like vouchers or coupons.
As the demand for personalization is increasing rapidly, so is the need for more data which is putting customers apprehensive about sharing more information about themselves. This has spelled the end of third-party cookies, but that doesn’t mean you cannot provide great personalization.
Coveo has found out in a survey that 51% of respondents would share their data with a brand they trust. So, the first thing for brands and small businesses to do is to gain the trust of their customers.
Moreover, it is the responsibility of eCommerce companies to ensure that they adhere to data privacy laws and take measures to ensure no data breaches.
Companies with a large or global customer base need to start investing in dynamic content to serve their customers. For this strategy to work effectively, they need to create segments of their traffic based on criteria such as:
Using these parameters, you can disseminate dynamic content that touches upon points that are important to these customers and convince them to buy your products.
The pricing of products can be tailored to a customer's demographic information, purchase history, and browsing behavior.
In 2021, one in five eCommerce companies in North America and Europe used dynamic pricing in order to personalize their eCommerce marketing strategy, while 17% have started to do so. This shows that dynamic pricing is fast becoming a permanent fixture in many companies’ eCommerce personalization campaigns.
But dynamic pricing is contingent upon a number of factors, such as:
Pricing algorithms manage the prices of both fast-moving and slow-moving products based on competitive price points, historical sales data, and market demand.
In conclusion, eCommerce personalization can be a great strategy to boost revenue, improve customer experience and loyalty, and get a competitive edge over your competitors.
Personalization starts with collecting customer data and creating segments. Analyzing these segments can help you understand customer behavior and intent and offer individualized pathways to purchase.
Besides that, you can leverage email marketing tools like Mailmunch to automate your marketing emails. You can use that data to maximize your email marketing efforts.
Moreover, offering personalized eCommerce experiences has become an indispensable industry standard and has started the trend of collecting data for personalization purposes. So, it will serve you well if you implement it today in your overall eCommerce business strategy.
A voracious reader and a music lover, Ammar has been writing engaging and informative content for over 3 years for B2B and B2C markets. With a knack for writing SEO-optimized content, Ammar ensures the results speak for themselves.
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