In a world without personalization, all shoppers get the same digital experience regardless of who they are. Your most loyal customers are asked to sign up for your loyalty program even though they’ve already joined it. Customers who always buy premium products are shown recommendations for low-cost products because those items are popular with other shoppers on the site. Visitors who prefer specific brands and categories are forced to hunt and peck. This type of one-size-fits-all approach may have been tolerated 10 years ago, but consumers no longer accept experiences like these.
Three-quarters of consumers prefer to do business with brands that make shopping experiences more personalized and relevant to their interests. While the promise of digital personalization has tantalized retail marketers for well over a decade, meeting customer expectations for amazing online and in-app experiences hasn’t always been easy.
Personalization: A Brief History
Before the advent of the internet, a shopper’s relationship with a retailer was largely developed in person. The internet then allowed retailers to automate the shopping experience, which created more efficient shopping visits for consumers. However, these early e-commerce interactions were impersonal and generic. It was the one-to-all period of online shopping.
As technology developed and allowed for some personalization, marketers were able to recommend products based on what “others like you” browsed or bought — although at the beginning, this was an IT-intensive initiative. This period allowed for one-to-many communication, where marketers tried to be helpful but couldn’t completely tailor an experience to an individual.
The Way of the Future is One-to-One
We've already entered the next period of online shopping: true one-to-one personalization.
Technology has advanced enough to allow for true one-to-one experiences based on each shopper’s intent and affinity in the moment. This requires the ability to track on-site behavior and combine that data with historical and third-party data systems. These compilations are then used to determine what each person is shopping for and what specifications — e.g., departments, styles, brands, colors, price ranges, keywords, search terms, etc. — the shopper prefers to create individualized experiences for each person.
All this tracking, selecting and proposing now occurs within a fraction of a second. This type of one-to-one personalization is the way of the future.
One retailer that has embraced this future is flash-sale boutique Rue La La. Rue La La creates a personalized journey for each and every shopper to provide a better brand experience and guide shoppers to products of interest. The company combines CRM data with in-depth behavioral analytics (e.g., time spent on a page, scrolling patterns, cart additions, purchases, etc.) to understand the intent of each shopper and respond with relevant experiences and personalized recommendations.
Here’s an example: Rue La La has a “What’s Trending” section on its homepage to facilitate product discovery, since new products are always being added and quickly sell out. Rather than show a random assortment of trending products or the most popular products, Rue La La tailors the products shown to the interests of each individual shopper, so that visitors see the brands, categories, colors, etc., they each prefer.
Personalization: An Increasingly Strategic Priority
According to Forrester Research, 75 percent of organizations say personalization is their top e-commerce priority for next year. Therefore, retailers that aren’t able to provide one-to-one experiences risk falling behind. Furthermore, Gartner predicts that by 2020, smart personalization engines that recognize customer intent will enable digital businesses to increase their profits by up to 15 percent. Retailers that invest now in the capabilities to identify visitor intent and act on this information in real time will be well-positioned to grow as the next era of personalization unfolds.
Karl Wirth is the CEO and co-founder of Evergage, which provides real-time personalization to more than 1 billion web visitors.