For the retail industry, shifting trends and dynamically evolving customer expectations are nothing new. Multiple influencing vectors, including external recommendations and personal choices, all equally contribute to customers’ buying decisions, and then with time, these changes and trends go on.
Sitting at the core of a pandemic, the world is dependent on eCommerce players now more than ever. Based on ACI Worldwide data, there was a 74% increase in average transaction volumes in March 2020 versus the same period in 2019. And, that is merely the tip of the iceberg. An increase in online shopping trends offered the ability to better understand customer behavior and requirements, opening the doors for better personalization.
While keeping up with these diverse patterns is one way to gain buyer’s mindshare, there are numerous other routes that brands can take to achieve this. Of which, personalization has emerged as a game-changer in recent times, especially for eCommerce players with digitally acquired insights at their disposal. According to a Forbes study, 80% of shoppers are more inclined to a brand that offers them a personalized experience. In contrast, 71% of customers feel frustrated when their shopping experience is impersonal. Against this background, the eCommerce industry needs to ace the personalization game to move from gaining mindshare to market share.
In the face of the current crisis, customers opt for contactless delivery, and online retailers answer their problems. Service providers help their customers deal with the uncertainty of the current pandemic by offering a seamless online shopping experience that has definitely created a loyal customer base.
From better business outcomes to enhanced loyalty, here are some reasons why personalization can prove to be a differentiating factor for the eCommerce market.
- Increased customer loyalty and return rate: Creating a loyal customer following is the most challenging task for any business, and personalization can be a crucial factor in achieving this. According to a Salesforce survey, shoppers who clicked on or made a purchase through recommendations had nearly double the likelihood of returning. This easily forms the base for a loyal customer following—and in many cases, they turn into ambassadors for the brand. Offering a personalized shopping experience is a surefire way to build trust and customer loyalty.
- Reduced online choice fatigue: With a levy of options available on the internet, customers often go through a negative psychological state of mind. This is called online choice fatigue, and it is a crucial factor in determining an eCommerce organization’s success. One of the most frequent outcomes of choice fatigue is cart abandonment. Some experts believe that customers overwhelmed by the choices and varieties available online are often likely to abandon the purchase. Understanding a buyer’s preferences and offering a personal touch all through their journey can ensure that the sale goes through with a lower customer bounce rate.
- Cost optimization: While brands need to maintain stock availability at all times to ensure customer return rate, this ability comes with a catch. When the product in stock goes out of trend, brands incur huge losses. With insights derived from personalization, they can understand the changing trends and accordingly optimize their inventories. This way, they can optimize costs by avoiding excess storage and ensuring that in-demand products are always available. Stock optimization goes a long way in helping FMCG brands to ensure customer loyalty and stay profitable.
- Pattern-Tracing to Scale Production: Needless to say, the more customer insights a brand can draw, the more personalization they can drive in their products. Consider that they share a lot of information on every customer’s shopping journey that is often undermined. This ranges from high-level choices like frequently combined items to minute behaviors such as mouse-hovers, subscription to size-availability. Keeping these details in mind, eCommerce organizations can provide a hyper-personalized experience to that particular customer and recommend items to other shoppers who follow similar patterns. Based on the types of customizations that users make, product development teams can analyze and understand customer preferences better, driving brand loyalty.
Examples of Successful eCommerce Personalization
Amazon: One of the pioneers of online shopping is known for continually perfecting its personalization game. This comes as no surprise since Amazon’s customers receive emails and personalized newsletters based on their browsing and shopping history. This adds a new twist to one of the earliest forms of outbound marketing: emails. With frequent updates on products relevant to their previous purchases, shoppers are more inclined to return and make another purchase.
Evergage: Another blue-sky thinker in the field of eCommerce, Evergage takes a unique path to eCommerce personalization. It personalizes the banners visible to different individuals based on their viewing and purchasing preferences. The first thing that a visitor sees as soon as they land on Evergage’s website is product recommendations based on their customized taste and needs.
Very.co.uk: The eCommerce front for Shop Direct has one of the most exciting personalization ideas. This eCommerce brand considers the shopper’s location and suggests apparel and promotions based on the weather forecast for that area. If this isn’t staying ahead, what is?
The PIM Factor
Personalization has evidently turned into an ancillary factor, especially for eCommerce brands that seek to win customers amid competition. Rapid response in their personalization efforts can help them be the first in their respective segments to win those early customers and get a head start in the race. It is essential to harness product data's full potential to provide shoppers with an engaging and personalized shopping experience.
A well-optimized product information management (PIM) practice is key to this strategy. Not just quicker time-to-market, but a robust PIM solution can help with all-round personalization, giving brands the ability to customize products across every stage of product development. Moreover, a PIM software enables you to:
- Consolidate and manage multiple product data silos at a single place
- Enhance and improve existing product data publishing capabilities across multiple channels
- Extend product information to new channels while retaining consistency and continuity
- Deliver part of an API-oriented architectural approach for new digital commerce initiatives
- Easily import and export data between systems for business agility and scalability
A PIM solution serves the purpose of being a reliable single source of truth about the product and the buyer and the changing trends in purchases. And, with access to that, an eCommerce organization can go on to earn customer loyalty, increase revenue and cut overheads, all in one go.