How to Maximize eCommerce Conversion with 1 to 1 Personalization A Guide to Modernizing Your Retail eCommerce Personalization Efforts
How to Maximize eCommerce Conversions with 1 to 1 Personalization
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eCommerce sites are handicapped by their failure to recognize and act on the information shoppers share about their individual preferences and tastes. Opportunities for increased customer engagement, conversion rates, and revenue are lost as a result. Tepid results are common issues for Marketers who rely on Old School Personalization solutions to drive digital shopping experiences. Understanding the fundamental differences between Old School Personalization and 1 to 1 Personalization is the first step to solving these problems.
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The Achilles Heel of Old School Personalization: Segmentation Old School Personalization
visitor expresses through their
targets overly broad segments
immediate shopping behavior. As
made up by large groups of
a result, retailers may have a clear
shoppers or customers. Historical
rearview mirror, but they miss out
data is analyzed to determine
on real-time opportunities.
commonalities, which are most often based on purchase behavior.
While better than nothing at all, this dated approach is costly and time consuming.
To find these potentially shared interest groups, the definition of commonalities is broadened, and as a result, the segments become less and less relevant to the individuals within the group. While better than nothing at all, this dated approach is costly and time consuming. Even after all the work has been put into creating these segments, they supply little more than rearview views into your business. Customers
Another issue is that it is impossible to target an entire segment with a message that resonates for everyone. Just because someone bought a pair of baby clothes and is female, does not mean they are expecting a newborn. Inundating that person’s future shopping experience with cribs and strollers could potentially be damaging for the relationship between the brand and customer. No one wants their shoppers thinking this:
within these types of segments are
I love this brand and shop here
often times quickly become even
all the time. But ever since I
less relevant once implemented.
bought that shower present,
Timeliness also matters. Many Old School Personalization solutions base their presentation decisions
am I getting nothing but baby promotions. It feels like they don’t even know me.
on batch data processes that are
While shoppers don’t want to be
presented to large segments in a
creeped out by your targeting them
static experience that is updated
with your customer knowledge,
at best once a day. They do not
they do appreciate having a positive
respond to the interest that the
shopping experience where they find
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more of what they are looking for -
opportunity is not possible with
instead of having to click through 10
Old School Personalization solutions
digital pages of jeans. By prioritizing
(which only boost conversions by
merchandise around each shopper’s
a couple of percentage points),
individual preferences, retailers
it is the fundamental core of 1
have an opportunity to not only
to 1 Personalization (where the
relieve shoppers from digital content
effect that personalization has
overload, but also significantly
on conversions is normally in the
increase engagement, returning
double digits).
traffic and conversions. While this
How 1 to 1 Personalization Differs from Old School Personalization 1 to 1 Personalization is about
individual customer, presenting
engaging individual digital
the products that they prefer.
consumers. It allows brands and retailers to anticipate each shoppers’
Every interaction a shopper has with a brand online is a valuable insight to that person’s preferences.
preferences - based on their own shopping behavior - and respond with content and merchandise that resonates to that individual. Every interaction a shopper has with a brand online - including each click, search query, product detail page view, add to cart, and purchase is a valuable insight to that person’s preferences. These insights are used to create a progressively on-target shopping experience for every
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The more often an individual visitor returns and engages with a website, the more they share about their preferences through their shopping behavior. By paying attention and responding to these preferences, sites have the opportunity to curate highly relevant shopping experiences for each individual visitor. This leads to higher engagement and returned visits, better conversion rates, and revenue increases (in most cases, double digit) for retailers.
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Examples of 1 to 1 Personalization versus Old School Personalization Following are a few examples that demonstrate the difference between using Old School Personalization solutions that are limited by segmentation versus true 1 to 1 Personalization that’s tailored to the individual in real time.
S C E N A R I O O NE
Packing for the Camping Trip A family is planning their first camping trip. The mother has been using an outdoors site to search for gear and get ideas for what they might need. She leaves the site to pick her kids up from school, but returns a few hours later to complete her purchase. What featured items are recommended to her on the home page on her subsequent visit?
OLD SCHOOL PERSONALIZATION
1 TO 1 PERSONALIZATION
vs On the homepage, the mother sees an array
In a 1 to 1 Personalization scenario, the mother
of featured products representing the site’s vast
sees merchandise tailored to her interests and built
inventory, including jackets, a hunting knife, and
off of her previous shopping behavior. The site
a rifle case.
expands on what she has viewed and anticipates
Although these may be top sellers across the site, most of the items are far off base and unhelpful in
additionally related interests. This adds an element of intelligent discovery as she returns.
her case. In other words, her experience is just like that of any other visitor. In order to find what she’s uniquely looking for, she’ll need to dig much deeper.
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S C E N A R I O T WO
The Perfect Beach Shorts are a Click Away A woman is going to the beach for vacation. A couple weeks before leaving, she navigates through a surfware site for items to bring with her on her trip. What does her search experience look like when she puts her cursor into the search box and types the letters “s” and “h”?
OLD SCHOOL PERSONALIZATION
1 TO 1 PERSONALIZATION
vs
After typing in “s” and “h”, autofill suggests “shirts,
In a 1 to 1 Personalization scenario, as soon as
shorts, shoes, shoes & sandals, and short sleeve
the woman begins typing, she immediately sees
tees.” While it is helpful that she didn’t have to
visuals of merchandise that is especially relevant
complete the word, she is still several layers away
to her. The shorts not only match her gender, but
from the women’s beach shorts that she wants
also have attributes related to her style. The layers
to buy for her trip.
separating her from the shorts she is going to wear on vacation have been reduced to zero. She’s able to view the product detail page with a single click.
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S C E N A R I O T HR E E
Boot Shopping on the Train A young professional is commuting home from work and has a couple of minutes to spare. He’s been shopping for boots, so with his iPhone, he returns to his favorite streetwear site to quickly see if there’s anything new or on sale. What does he see on the site’s mobile homepage?
OLD SCHOOL PERSONALIZATION
1 TO 1 PERSONALIZATION
vs
When he navigates to the site’s homepage with his
The site responds to his previous visits by bringing
iPhone, he sees top selling sneakers even though he
the most relevant and recent experiences front
has been searching for boots for a couple of days.
and center. His preferences have been accurately
He quickly becomes fatigued trying to navigate the
anticipated by the site and the merchandise he
hierarchy of menus on a tiny screen. After swiping
is most interested in is prioritized accordingly.
through lists of endless footwear that doesn’t
He sees various choices for boots and clicks on
interest him, he moves on. This is a prime example
one that he hasn’t seen before but has elements
of why average smartphone conversions are so low
similar to a lot of the boots he has been looking
in Old School Personalization mobile experiences.
at. He manages to add it to his wishlist just before reaching his trainstop.
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Traits of Successful 1 to 1 Personalization What key characteristics separate
real time preferences is critical to
Old school Personalization from
both a successful digital experience
1 to 1 Personalization?
and positive brand engagement. The more often an individual visitor
True 1 to 1
The more often an individual visitor returns and engages with the site, the more relevant their shopping experience should become.
returns and engages with the site,
A key word in successful 1 to 1
the more relevant their shopping
Personalization is “individual”.
experience should become. 1 to 1
A Personalization solution is only
Personalization balances a shopper’s
truly 1 to 1 if it can anticipate
historic activity and immediate
and react to each individual’s
circumstances in an intelligent
preferences based on their
way. When a visitor expresses
shopping behavior and respond
new interest in a certain product
with content and merchandise
or category, a site should cater
that is meant specifically for that
to these current preferences rather
individual - rather than a group.
than continue to lead them down
In the case of the mom shopping
the same tunnel vision path.
for her son, she has already expressed a preference towards Star Wars in a past session. The site should respond by making Star Wars related items prominent within her experience, rather than simply directing her towards the items which may happen to be trending across the site or for her
At the same time, temporary changes in a user’s shopping behavior should also be taken into account. If a shopper is visiting in order to purchase a gift for someone else, it’s important to respond accordingly in the moment, but not thwart all future experiences
segment, but have nothing to do
if the purchase was a one-off event.
with her interests in that moment (such as princess dresses).
Insight and Merchandising Controls
Real Time response
While a 1 to 1 Personalization
The ability to facilitate product
solution provides great advantages,
discovery in the shopping experience based on expressed,
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retailers need to be able to measure its successes and opportunities.
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The platform should make you
leverages that insight by capturing
Or it may be necessary to blacklist
immediately aware of the effect
otherwise hidden trends and data
discounted items from appearing
that Personalization is having on
correlations which can help you
as a recommendation on a full
your eCommerce business. In the
make more informed decisions
priced item’s product detail page.
case of Reflektion, a dashboard
and optimizations moving forward.
shows how conversion rates, revenue per visit, average order value, time spent on site and other KPIs are performing relative to a control group. There is a world of insight sitting in all the success that 1 to 1 Personalization brings to retailers. Real time analytics
Whether your goal is to optimize
In addition to insight and
for revenue, profit margin, loyalty
performance, a personalization
or other objectives, a strong 1 to
solution has to include the unique
1 Personalization solution should
merchandising controls a retailer
provide the insights and levers
needs to present their products.
you need.
For example, you may need to boost overstocked merchandise.
What results can you expect from 1 to 1 Personalization?
70% 26% Engagement
Over the past couple of years, the concept of tailoring digital shopping experiences to the individual has evolved into a proven concept that generates significant returns for brands like Disney, Uniqlo, and Converse. Where Old School Personalization solutions can only affect revenues by the low single digits, 1 to 1 Personalization has proven to deliver much more significant results.
Conversion
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Moving forward with 1 to 1 Personalization Retailers and brands are often surprised by how easy it is to launch a 1 to 1 Personalization platform. There is no need to waste valuable time creating and maintaining tedious correlations between products and segments. Additionally, since the core of 1 to 1 Personalization is self learning (based around learning individual shopper behavior), it begins working immediately. If you feel that 1 to 1 may be worth exploring for your brand, here are some next steps you can take to learn more:
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Understand more about the differences between Old School and 1 to 1 Personalization in this white paper: Segmentation is Not Personalization: Don’t be Fooled http://info.reflektion.com/personalization-and-segmentation
2
Read a case study to learn how leading eCommerce brands are successfully using 1 to 1 to improve their business results: How O’Neill Boosted eCommerce Sales by Applying a 60 Year Old Approach to Retail http://info.reflektion.com/hs-fs/hub/422174/file-1986201112-pdf/ Content/RFK_CaseStudy_ONeill_FA.pdf
3
Schedule a demo of Reflektion’s platform to see how 1 to 1 Personalization could work specifically for you.
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