How to Create Ecommerce Personalization in The Industry

With physical stores, it can often be the case that people use the same shop regularly and are well-known there. That means that staff can remember your name and, perhaps more importantly, can have some insights into your tastes and the type of products you prefer. With more than 2.14 billion people now shopping online, can that level of personal service be replicated? 

Ecommerce is now a huge sector and continues to grow. In fact, the sector saw a global revenue surpassing $6.5 trillion in 2023, and that figure is estimated to reach around $8.1 trillion by 2026. 

Digital personalization is also possible for businesses that sell digital products such as ebooks, music, or software, as the same level of data collection can be applied to these products as well

So, how do you take that highly-valued personalized service you often find in brick and mortar stores and transpose it to a world of websites and chatbots with no physical interaction?

What is Personalization in Ecommerce?  

Image sourced from McKinsey 

The basic philosophy behind ecommerce personalization is much the same as that in physical stores; know your customers, remember their details, and take your knowledge of them to provide a better customer experience and make your customers happier. Of course, the big difference is that you are operating online and have the opportunity to collect and store a massive amount of data on every single customer. 

Ecommerce personalization will be based on data that can encompass everything that you know and understand about them. That can include:

• Name and geographic location. 
• Demographic segment (if you have done segmentation) that can include details such as: age, gender, spending power, etc. 
• Browsing history. 
• Previous purchase history. 
• Device(s) used for accessing your site or platforms. 

Personalization can affect a consumer’s decision to buy from you or from a competitor. A new study done by Epsilon shows that 80 percent of consumers are more likely to buy from a brand that personalizes their experience. Similarly, according to a study done by McKinsey, 78% are more likely to recommend your brand to their friends and family, something that can lower your CACs (customer acquisition costs) and improve your customer retention rates. From the same study, data shows that 71 percent of consumers expect companies to deliver personalized interactions, and 76 percent of customer are getting upset when that doesn’t happen.

So, you know what ecommerce personalization is, and you know that it can bring your business benefits while improving the customer experience and its related ROI, but how exactly do you create an ecommerce personalization strategy? 

How to Create an Ecommerce Personalization Strategy

Image sourced from startupbonsai.com

‍

At the heart of ecommerce personalization lies data, and that data has to capture the most important details so that you can build a thoroughly personalized customer journey. You will need two things to amass useful data for a personalization strategy. The first—and most important—is an efficient CRM (customer relationship management) system that will not only store data but will also be easily accessible by your staff and any automated systems.

The second thing you’ll need is good website analytics. Analytics is not just about measuring performance, it’s also about collecting essential data on how each customer uses your website. Now, you can initially segment those customers into two categories; returning visitors and first-time visitors. 

Each group is distinct, so you will want to collect and store different data. This data can not only help with ecommerce personalization but using the data in other areas can also help with inventory and can help with planning tools, such as this Inventory Planner lead time guide. 

Returning Visitors

• Previous purchases from your site.
• Frequency of visits and purchases.
• Their current CLV (customer lifetime value).
• Their average order value.
• Any previous interactions with you (this can include emails, social media, live chat, or via a contact center if you have one; this can also help with CSAT metrics).  

New Visitors 

• How long they spent on your site.
• Which pages they visited and the time spent on each.  
• Cart activity (did they add items, did they go through the checkout process, or did they abandon their cart?)
• Did they wishlist any items? 
• Exit page (which page were they on when they decided to leave). 

Of course, the level of ecommerce personalization is going to vary greatly according to the data you have on any one person. You will be able to better personalize for a customer who has been shopping with you for several years than one who has made only a few visits. However, with the latter group, the personalized experience will improve with time. 

You can also offer consumers freedom of choice by allowing them to opt in when it comes to how much data they provide to you. This gives them more control in an era when many feel they have lost that control. It can also help build more trust in your brand and can help our organization comply with any regulatory requirements such as the CCPA (California Consumer Privacy Act). It’s essential you meet any regulatory requirements when collecting data. 

You can also offer consumers freedom of choice by allowing them to opt in when it comes to how much data they provide to you. This gives them more control in an era when many feel they have lost that control. It can also help build more trust in your brand and can help our organization comply with any regulatory requirements such as the CCPA (California Consumer Privacy Act). It’s essential you meet any regulatory requirements when collecting data. Additionally, if you use residential proxies for SERP checking it can help ensure that your search results are accurate and personalized to the user's location.

Ecommerce Personalization Tactics You Can Use

Image sourced from ROI Revolution

So, you have the customer data in your CRM; you may even have segmented customers into groups according to some of your collected data. The question now is, how do you turn that data and information into a personalized experience that will make your customers happier? 

1. Pop-ups

Automated pop-ups can be a great tactic. You can use them in various ways, from offering discounts to first-time visitors in exchange for contact details to upselling better products or related items. You can also use them to increase the average order value by letting customers know that orders over a certain value qualify for free shipping. Pop-ups are triggered by either actions or time and can be based on a number of personalized factors.

2. Dynamic pricing

You can use dynamic pricing with the demographic data you have on a customer. For example, you may choose to offer a special price to a customer who has a high CLV and regularly buys from you. It’s also a good way to improve slow-moving or excess inventory turnover rates. Dynamic pricing also looks to other data, such as market demand, changes in consumer behavior trends, and competitive price points. 

3. On-site targeting

There are different ways you can personalize the on-site experience according to the data you have.

1. Dynamic content blocks

DCBs are a great way of recognizing customer behavior and personalizing their experience. Your blocks can display the last products they browsed, their last order, or even products related to what they are looking at or buying. You can also use them to advertise exclusive offers for high-value customers, CTAs to undertake surveys, use a quiz maker, or offer discounts for members of any loyalty program. 

2. Overlays

An overlay will appear in the middle of whichever page the customer is browsing. They very much rely on timing and you should be careful how you use them. Overlays can increase your ecommerce personalization in the following ways:

• New visitors: Offer them new customer discounts, tours of your site, or ask them to subscribe to your newsletter. 
• Customers in difficulty: If your system alerts you to customers who are struggling (for example, in the checkout process), then you can offer help such as live chat or giving them a contact number/email. 
• Potential bouncers: If your system senses a customer is about to bounce, then you can present an overlay with a special offer or discount. 

3. Headers and footers

We’ve all done it, pressed the X to close a pop-up when browsing. If your system detects a lot of customers doing this, then consider using headers or footers instead. You can use these to tell people when a sale is happening, show reviews to the visitor, offer a discount on a specific product such as Dialpad’s virtual receptionist service, or add a CTA to anything you want. 

4. Product Recommendations

Free to use image sourced from Unsplash

Ecommerce personalization can bring many benefits, and you can use it to determine what your customers like and buy. Then you can recommend similar or related products. You can customize the homepage they land on to reflect their preferences or create lists showing them the best-selling or best-value products in their preferred categories. 

5. VIP Segmentation

Of course, all your customers matter, but VIP customers are a special group. They have the highest CLs, buy frequently and usually with a high average order value, and buy products at full price. If you follow the Pareto Principle (20% of your customer base will account for 80% of your sales), you will know you should treat this group well. Once segmented, offer them loyalty rewards, exclusive offers, free gifts, or other rewards.

6. Checkout Offers

Once a customer reaches the checkout stage, it can be a great opportunity to upsell or cross-sell. This could include accessories or peripherals that complement the product(s) in their cart or a similar product at a higher price point but with free shipping or a similar offer thrown in. The point at this stage is to use ecommerce personalization to drive up the average order value.

One way to improve the customer experience and add a personal touch to ecommerce is through custom shipping boxes. These boxes can be branded and personalized with a customer's name, adding a special touch to their order and making them feel valued. Custom shipping boxes can also be used to promote new products, loyalty programs, or other marketing initiatives. Consider using this tactic to add an extra layer of personalization to your ecommerce business.

The Takeaway 

Free to use image sourced from Pexels

Ecommerce personalization can help every area of your business, from website performance to call center management strategies. How deep that personalization will go is going to depend on how much data you have on that person. However, as you accumulate more data and learn more about that person’s behaviors you can increase the level of personalization. 

Happy customers who have a positive experience with your ecommerce business are more likely to become loyal customers. Ecommerce personalization, along with good customer service and quality products, plays a big role in achieving that.