Personalization has been a major priority in ecommerce for years. In 2023, nearly seven out of ten businesses surveyed said they had plans to increase their investment in personalization. A report from 2024 found that 89% of business leaders believe personalization is critical to business success.
The reality is that personalized product recommendations, website content, customer service, and other tactics have the potential to boost customer loyalty and revenue growth. The impact is the most profound in ecommerce. Research shows that direct-to-consumer digitally native brands see a 25% revenue lift from personalization, compared to the 10% to 20% for brick-and-mortar companies.
So, what type of personalization strategies should you use for your ecommerce business? This article examines why personalization matters, how to get started, and examples of personalization in ecommerce to inspire your approach.
What Is Ecommerce Personalization?
Ecommerce personalization is the process of tailoring the online shopping experience to customer wants, needs, and preferences. It involves continually updating the online experience so it’s more user-centric and meaningful to your buyers.
In practice, personalization can impact every step of the online shopping experience, such as:
- Website design and layout tailored to different customer segments.
- Targeted email campaigns with personalized product recommendations and offers.
- Ecommerce sites that display recommended products based on past customer behavior.
- Quizzes to help ecommerce brands tailor their product recommendations.
The goal is to make customers feel like the brand understands them. As a result, they have a better experience and are more likely to become loyal customers.
Benefits of Personalization in Ecommerce
Today, consumers expect their online experiences to reflect their needs. Whether they're aware of it or not, intelligent ecommerce tools can identify their needs and wants before them. Staying a few steps ahead of your customers and guiding them to items that satisfy their search can help increase customer satisfaction, leading to higher conversion rates, better engagement, and a lift to your bottom line.
Improved Customer Satisfaction and Loyalty
Personalization is what customers say they want, so it’s no surprise it’s linked with higher levels of satisfaction and loyalty. One study found that customers who rated the level of personalization they experienced as a nine or 10 ( on a scale of zero to 10) also rated their overall satisfaction very high.
Increased Conversion Rates
When people see the products they’re most likely to need, they’re more likely to convert because your brand becomes a straightforward solution to their problems. A Statista survey of marketing professionals found that 63% saw higher conversion rates as a direct result of personalization.
Enhanced Customer Engagement
Using tactics like email personalization and personalized web content gives your audience content they can connect with, helping boost engagement. In that same Statista survey, 64% saw more customer engagement after personalization.
Higher Average Order Value
Things like personalized shopping features on your ecommerce site and personalized recommendations can nudge customers to purchase more items or higher-value items.
Think of someone shopping for a new couch: personalization features might show a matching throw pillow and blanket, giving them ideas for how to style the couch. They buy the couch and the matching pillow, so your business sees a higher order value. Meanwhile, the customer ends the transaction feeling even more satisfied despite spending more money.
Increased Revenue
Using personalization to offer better experiences, your business can also expect more revenue. Brands that excel at personalization are 48% more likely to exceed their revenue goals than those that don’t have a mature personalization program.
Ways to Personalize the Online Shopping Experience
The foundation of effective personalization is data. Your ecommerce brand can collect and analyze data to better understand customer needs.
This data can be utilized for various customer personalization strategies, including intelligent product recommendations, continuous shopping for repeat visitors, personalized "best-seller" pages, in-session retargeting, automated personalized email campaigns, and social retargeting.
From there, you can use technology like ecommerce platforms and software to automate personalization and management, allowing you to deliver tailored experiences at scale.
So, what are some of the best ways to personalize the ecommerce experience?
Intelligent Product Recommendations
Personalized product recommendations present shoppers with items that complement those they've already seen and popular alternatives. For instance, your ecommerce site could suggest a shirt or jacket to complement the pants your customer is viewing or a similar pair at a slightly higher price point. This strategy can be incredibly effective for upselling and increasing your margins.
Dynamic Website Content
You can customize landing pages, banners, product displays, and other content based on customer data to deliver personalized website content. This personalization strategy works well for ecommerce brands that serve distinct customer segments. You can then personalize the web browsing experience based on a user’s geographical location, past shopping behavior, device type, and more.
Personalized Customer Service
From AI chatbots that offer personalized recommendations to giving reps access to customer information so they can customize interactions, there are many ways to personalize customer service. A Zendesk survey found that 62% of agents feel that having access to data like customer names and shopping patterns can help them personalize interactions.
Continuous Shopping for Repeat Visitors
Similar to being able to pick up where you left off with a streaming TV show, continuous shopping allows your visitors to continue with their previous session, even if they've left the site or closed the browser. By holding the contents of their shopping cart and presenting them with items they viewed the last time they were on your website, you can boost your customers' chances of making a purchase.
Personalized "Best-Seller" Pages
Consumers want to know which items are the most popular. Personalization software can create customized pages or filtered results showing best-sellers based on a shopper's location, search history, or previous purchases.
In-Session Retargeting
In-session retargeting is an excellent way to drive conversions. You can use intuitive pop-ups with recommendations aligning with your customers' activities and behavior on your site. This could include shopping cart reminders, highlighting previously viewed products, or video content showcasing your strengths versus competitors.
Automated Personalized Email Campaigns
You can engage with your customers directly through their inboxes with customized messaging to boost brand awareness, showcase your products, lead them back to your site, and encourage a transaction. Personalized emails have a 26% higher opening rate and are nearly eight times as effective at generating revenue.
The right ecommerce personalization software can automate your campaigns for you. Some effective attention-getting techniques include cart abandonment notifications, "We miss you" messages, order follow-ups, requests for product reviews, recommendations based on previous purchases, and new product announcements with collections curated to their browsing history.
Social Retargeting with Intelligent Recommendations
Just because a shopper has left your website doesn't mean you can't re-attract them. One of the easiest ways to do this is through social media retargeting using AI-powered recommendations. Social retargeting could involve sponsored display ads, carousel ads showcasing the products a shopper viewed, or user-generated content. When timed carefully with the help of AI, you've got a recipe for success.
3 Steps to Get Started with Personalization
If your ecommerce business doesn’t already have an effective personalization strategy, you can start with these three steps.
1. Collect Customer Data for Analysis
First, determine which channels to gather data from and how to do it. Leading ecommerce platforms can integrate with your customer relationship management (CRM) tool and most channels, including email, social media, and chat, so you can automatically gather data.
2. Segment Your Customers
Next, determine how to segment your customers. You can divide customers based on location, behavior, or preferences. Once you have your customer segments, you can develop customer personas for your ecommerce brand, and then create specific messaging, content, and journeys for those personas.
3. Identify What Personalization Tools to Use
AI and machine learning tools can automate ecommerce personalization. For instance, your email automation tool can send out an email series after a trigger, such as a download or purchase. AI chatbots can personalize recommendations, reactions, and even their tone of voice.
Here are three examples of personalization software that can integrate with your ecommerce platform, allowing you to seamlessly create personalized experiences at scale.
Nosto
With Nosto, you can personalize every piece of content that comes across your customers' screens to deliver a better brand experience and drive more conversions. The platform uses machine-learning algorithms and powerful AI to create dynamic, customized messaging and imagery relevant to a shopper's unique needs and desires. In other words, each visitor will feel like your website was made exclusively for them.
Bloomreach
Bloomreach Experience Manager is a robust ecommerce platform that leans on progressive profiling, targeting, and audience segmentation to deliver personalized content in real time. Its intelligent software uses data collection, set logic, and A/B testing to curate an individualized customer experience that meets each shopper's needs and becomes more useful with every click.
Dynamic Yield
With Dynamic Yield, merchants can tailor static website content (like hero banners, search results, and call-to-action buttons) to each visitor. The AI-powered platform also allows you to personalize page layouts according to a shopper's preferences, create customized multi-channel experiences, automatically generate product recommendations in real-time, and trigger promotional emails and pop-ups.
Examples of Personalization in Ecommerce
Here are two case studies showing how personalization can impact the customer experience and drive revenue growth.
How Ecommerce Personalization Supported T3's Online Sales
Cult-loved hot hair tool brand T3 turned to Guidance for its multi-site platform upgrade. The goal was to showcase its brand promise, create customized purchasing opportunities, and encourage continuous engagement.
Our team of experienced web developers drew on analytics and interviews with customers and stakeholders to develop personalized widgets from scratch. Since T3's hair tools are made to last, this allowed for product suggestions to complement the items shoppers already own instead of recommending items they're unlikely to purchase.
How Ecommerce Personalization Supported City Chic's Growth
Plus-size women's apparel retailer City Chic previously had three stand-alone sites in the U.S., New Zealand, and Australia. Upon acquiring two other brands, the merchant partnered with Guidance to combine all five sites onto a single platform.
This web development project included several customer personalization strategies, including timed campaigns derived from visitor widgets, localized content for each continent, and a customized checkout experience. We also created a "Rock the Style" concept in which customers can shop the clothing and accessories seen on an outfitted model. With a single click, they can add each item to their shopping bag.
Grow Your Business with Personalized Ecommerce Web Development
If you are looking to boost your revenue or grow your ecommerce business, effective personalization is essential. How you create a user experience and customer journey ensures customer satisfaction.
Whether it is a personalized product recommendation, personalized emails, or another marketing strategy customization, leveraging customer data to create a personalized shopping experience has never been more critical.
At Guidance, we're committed to helping growth-oriented merchants set themselves apart from the competition. With over 25 years in the industry and a finger on the pulse for the newest strategies, we know what works. We partner with Bloomreach, Nosto, Dynamic Yield, and other AI-powered software platforms and can help you determine which tools will support your bottom line.
Are you ready to explore the world of personalized online shopping? Contact us to get started.
