Electronic Commerce is more than just purchasing and vending products online. It encompasses the entire online process of developing, marketing, vending, delivering, servicing and paying for products and services. Conflicting from traditional consumers who were limited to buying goods and services from physical stores, today’s consumers demand more comfort and less resistance across their purchase journey from the brands they shop with. As a result, the companies need to understand how to deliver a personalized and immersive shopping experience based on a customer’s shopping preference.
What is personalization in E-commerce: It is a means of meeting the customer’s needs more effectively and efficiently, making interactions faster and easier, and consequently increasing customer satisfaction and the likelihood of repeat visits.
Importance of Personalization in E-commerce: In today’s hyper-competitive e-commerce market, new stores are mushrooming every day. If you want to gain a competitive advantage, personalization is the key to build customer trust. Providing right content to the right users at the right time, helps gain user-attention thus increasing the probability of him/her becoming a loyal customer.
– Almost 74% of online consumers get frustrated with websites when the content (e.g. offers, ads, promotions) is not relevant to their needs.(Source: Janrain & Harris Interactive)
Plugging in personalization to your store and mails sent to customers can help you avoid that slippage and boost your conversion rates. The lower is the cart abandonment rate; the higher is the conversion rate.
– The top reasons for U.S. email users to unsubscribe from a business or non-profit email subscription are too many emails (69%) and irrelevant content (56%).(Source: ChadwickMartinBailey)
– Personalized emails improve click-through rates by 14%, and conversion rates by 10%.(Source: Aberdeen)
Personalization is one of the key factors of revenue growth for companies across the world.
– A study in O2’s The Rise of Me-tail states that adding personalization experience to shopping could lift sales by 7.8%.(Source: 02 – The Rise of Me-tail)
– 54% of retailers that use automated product recommendations increased their average order value year over year.(Source: Forrester Research/Shop.org)
How to get Personalization Right?
The key to customer’s loyalty depends on your ability to deliver personalized shopping experience so that customers can connect with the brand and explore what’s on offer. One can get personalization right by addressing customers’ specific needs through:
- Dynamic Content
- Product Recommendations
- Customized Banners/Deals/Offers
- Email Personalization – Emails with personalized subject lines have 26% higher unique open rates than non-personalized emails.
- Personalized Product Ads
- Behavior-based personalization
We are still in nascent stages of E-commerce Personalization:
We are still in the nascent stages of e-commerce personalization as most of the brands are yet to implement their first real-time personalization technologies. Let’s look into some stats that would give an insight in this area.
- 77% of marketers say “dynamic, personalized content” across channels is very important, but most are still in the planning stages. (Source: Adobe.com & DMA)
- 84% of marketing executives say they plan on developing a process to map rich media content assets to buyer journey stage. (Source: Aberdeen Group)
- 60% of marketers struggle to personalize content in real-time, yet 77% believe real-time personalization is crucial. (Source: Adobe.com & DMA)
- 70% of brands are still not personalizing emails sent to subscribers. (Source: Experian)
E-commerce is advancing at a fast pace and the competition is continuously increasing amongst all players. Although, the enterprises have acknowledged the need of personalization, they have their own sets of challenges to overcome.
- 30% of companies report that disparity in data sources in current CRM acts as a blocker in their efforts to personalize the content. (Source: Econsultancy + Monetate)
- 47% of the companies have reported that IT infrastructure has been posing hindrance. (Source: Econsultancy + Monetate)
- 44% of companies are held back in their efforts due to lack of resources or budget constraint. (Source: Econsultancy + Monetate)
Although personalization comes with its own challenges, it has its own advantages for the enterprises in maintaining the competitive edge along with increased revenue. Personalization leaves a wide room open for new innovative ideas to be explored and implemented taking customer experience to the next level.