You know those holiday gift lists populating the media right now — e.g., top 10 gifts for dad, the kids and so on? In an ideal world, shoppers would be presented with the most perfect, on-target gift suggestions for all of their recipients every time they visited an e-commerce site. While retailers aren't quite at the point where they can read shoppers’ minds and extract items their loved ones will swoon over as soon as they come to their website, the process of personalizing the shopping experience, particularly during the holidays, can be much better.
The problem is the way most retailers conduct personalization. They rely too heavily on past purchases and customer profile data. They personalize based on what the shopper has done in the past and not what they're doing in the moment. This approach usually fails when people are holiday shopping because they're making purchases for others, so any past shopping histories or personal profile data has no relevance. Holiday shopping is the antithesis of personalization. If you're a shoe nut and make lots of shoe purchases, that data can’t help a retailer personalize the shopping experience when you shift to shopping for sports equipment for your kids.
The holiday shopping season is the toughest time of the year to get personalization right, but it’s also the season that offers the biggest monetary rewards if you can figure out this challenge. There are signs that this scenario will change, making it easier for retailers to connect shoppers to the products they actually want at the moment they're browsing your site. Here are three ways I see personalization maturing in 2012:
1. Growing interest in intent-based personalization: Consumers show up at a website with an intent to purchase something, and this intent isn't necessarily reflected in their past buying habits or profile. Most purchases during the holiday shopping season aren't actually going to the person who’s doing the shopping, so old-school methods of personalization really don’t work.