9 Benefits of Personalisation in E‑Commerce: Why You Should Personalise Shopping Experiences
- Personalisation in e-commerce means connecting with your customers as much as possible, resulting in improved engagement and loyalty.
- Many businesses struggle with personalising shopping experiences due to outdated data collection tools and overwhelming datasets.
- Any business can get involved in personalisation, no matter their budget. They just have to be prepared to learn new technologies and methods.
What is personalisation in e‑commerce?
Personalisation in e‑commerce refers to the practice of tailoring the shopping experience of a customer to their individual preferences and behaviours.
E‑commerce personalisation can be achieved by analysing customer data about things such as purchase history, browsing behaviour, and demographic information, among other factors.
This information is then used to make targeted product recommendations, offer personalised promotions, and provide customised content.
Research shows that consumers are OK with sharing their personal information if it will enhance their experience of your online shop. In fact, 57% of online shoppers say that they’re happy to provide retailers with personal data as long as it’s used for their own benefit.
We can learn from this statistic that businesses shouldn’t shy away from using customer data to personalise their experiences but that they should be transparent about the practice if it’s to work effectively.
9 benefits of personalising shopping experiences
Why should you invest in personalising your customers’ experiences? Well, there are several positive outcomes, including increased customer engagement, loyalty, and sales!
Not convinced? You can expect the following benefits if you personalise your customers’ shopping experiences:
1. Increased customer satisfaction
Customers can easily become frustrated when they receive lots of irrelevant content and product suggestions from brands. They’ll just feel bombarded and overwhelmed and may unsubscribe from your mailing list.
On the other hand, personalisation helps to create a more enjoyable and relevant shopping experience for customers, leading to greater satisfaction when interacting with businesses that offer customised messaging.
2. Repeat purchases and increased sales
When customers feel that you understand their needs and have had satisfying interactions with your brand, they’re more likely to return to your online shop to make future purchases.
Plus, highly accurate product recommendations or offers have higher success rates than generic ones, increasing your sales. In fact, personalised display ads have a 10x higher click-through rate than traditional adverts.
3. Improved customer loyalty
Since personalised messaging resonates and doesn’t feel spammy or irrelevant, it can help to build stronger relationships with customers, leading to increased loyalty and advocacy. As mentioned above, personalisation can encourage repeat purchases because customers are nurtured to be loyal to brands through trust, understanding, and relevancy.
4. Higher average order value
Personalisation can appear at every point in the buyer’s journey (or sales funnel), including the checkout point. By suggesting personalised product recommendations based on a customer’s interests and purchase history, brands can encourage higher order values before visitors click ‘confirm’ on their baskets.
5. Enhanced customer engagement
Since personalisation creates a more engaging shopping experience for customers, they are more likely to spend time browsing your website and interacting with your brand.
Plus, 59% of online shoppers say it’s easier to find more interesting products on online retailers that personalise experiences, showing that through customisation, both navigation and engagement are enhanced.
6. Reduced cart abandonment
Through personalising things like product recommendations (based on purchase history) and shipping costs (based on location information), many common reasons for abandoned carts are resolved, thus reducing cart abandonment rate.
In addition, retargeting emails sent to cart abandoners can increase online sales by 20%, showing that sending this type of personalised message is effective at increasing conversions and awakening tired leads.
7. Better insights into customer behaviour
The process of personalisation in e‑commerce allows businesses to gather massive amounts of data on their customer base, revealing a mass of information on their behaviour, preferences, and demographic.
These insights can be extremely valuable, not just for refining future personalisation efforts but also for product development, inventory management, marketing strategies, and supply chain management.
8. Competitive advantage
By offering a more personalised shopping experience than your competitors, you can differentiate your business from others, attract new customers, and gain a large advantage over similar brands in your industry.
Moreover, if your personalisation efforts are combined with an easily navigable site and attractive price points, your business will have the makings of industry-leader status.
9. Improved brand image
Irrelevant emails and spammy product suggestions often do very little except annoy potential customers. On the other hand, personalisation can help to create a more positive and memorable impression of your business, enhancing your brand image and reputation.
Barriers to successful e‑commerce personalisation
Though there are so many attractive benefits to investing in personalisation, many brands find it challenging to execute in practice. The main barriers include the following:
1. Companies that have collected customer data for several years will have an overwhelming amount of data from historic customers and a limited amount from new ones, making it difficult to identify the most relevant trends.
2. Many businesses still use outdated data collection and analysis systems, which prevent them from understanding data accurately and harnessing it to a high quality.
3. It’s easy to overlook niche trends because they seem insignificant. So, businesses may only look for trends that are ‘statistically significant’. This is a mistake because it excludes individual needs, which is the whole point of personalising shopping experiences. Striking a balance between common and niche trends will be crucial.
So, how can brands start creating personalised shopping experiences ways that are easy to execute and reap the many benefits listed above? Well, it might begin with a tool or software.
Tools and software for e‑commerce personalisation
E‑commerce personalisation software is used by e‑commerce professionals, such as marketers, to learn more about their audiences and harness this information to increase sales, ROI, and conversions.
These software assist with these goals by monitoring user behaviour across channels such as mobile, web, and email and using the collected data to target site visitors with customised messaging.
They can also analyse the efficiency of personalisation campaigns, define and implement new campaigns to target segments of customers and be integrated to alter website features to carry messages or recommendations to site users.
These software are typically standalone products that integrate with shopping cart software, e‑commerce platforms, and product information management (PIM) tools to enhance an entire e‑commerce set up.
There are several tools on the market to choose from, including, Insider, Yieldify, and ActiveCampaign. The best software for your brand will depend on several factors which you should consider before finalising a purchase:
- Ease of use
- Subscription flexibility and free trial
- Previous customer testimonials
- Customer service rating
- Omnichannel access
- Breadth of data collection
- Segmentation abilities
- Ability to gather data from new and anonymous users
- Micro (aka one-on-one) targeting
- Automated and manual capabilities
- Integration into your CMS
- A/B testing capabilities
10 best practices for e‑commerce personalisation
If you’ve already begun personalising your e‑commerce shop and content but aren’t seeing the results you’d have liked, you might be doing something wrong. To optimise your personalisation efforts, you might want to incorporate some of the following best practices:
1. Use a unified dataset
To enable effective personalisation, it’s important to have a unified dataset that includes all relevant customer data. To achieve this, consider implementing a holistic personalisation platform that allows you to leverage this data effectively.
2. Ensure seamless integration
To create a cohesive shopping experience, make sure to integrate personalisation across all your marketing and e‑commerce tools. The architecture must be open, and all components need to be compatible to ensure the integration is seamless.
3. Use automated analysis
Personalisation involves analysing massive amounts of customer data, which can be extremely overwhelming for many businesses. To streamline the process and make it more efficient, you might consider leveraging automated analysis or machine learning – especially as the business grows.
4. Choose the right platform
There are many e‑commerce personalisation tools available, each with different features and capabilities. Make sure you choose one that aligns with your business goals and offers the tools you need to deliver effective personalisation.
(See the checklist above to ensure you select the tool that’s best for your business.)
5. Start with clear goals
Every successful project begins with clearly outlined objectives. Ensure you define the goals of your personalisation strategy before starting and that each aim is measurable.
Whether your goal is to improve customer loyalty, increase conversion rates, or reduce cart abandonment, knowing it will help guide your efforts.
6. Use segmentation
To ensure that your personalisation efforts are as relevant as possible, segmentation will be crucial to implement. Separating customers into groups based on their browsing behaviour, purchase history, location, and other demographic information, you’ll be able to deliver personalised content and promotions to the most relevant individuals.
Segmentation will also protect your mailing list, as people are less likely to unsubscribe if the emails you send are relevant to them.
7. Leverage real-time data
Real-time data can be highly relevant in personalisation because it is the most up-to-date.
For example, you could recommend complementary products based on what visitors have just added to their cart, display customised discounts based on their purchase history, or suggest products that relate to current weather conditions or local events.
8. Prioritise user experience
Personalisation should enhance the user experience, not detract from it. Ensure that your efforts aren’t intrusive, and make sure users can opt out whenever they want to.
Plus, don’t neglect other crucial parts of your e‑commerce efforts. For instance, improving website usability or updating email designs could be essential to elevating your strategy to the next level.
9. Test and iterate
The best personalisation efforts won’t stay the same forever. That’s why it’s so important to continuously test and iterate your personalisation strategy to gain optimal results. You can do this by experimenting with different personalisation tactics, such as recommendations, email campaigns, or personalised content, and measuring the impact of these changes on customer engagement and sales.
10. Be transparent
As mentioned at the beginning of the blog, users are happy for companies to collect personal data as long as they know it’s for their benefit. So, it’s crucial that businesses are transparent about collecting this information, not just for ethical reasons but also to let customers know it will improve their experience.
Who knows! Knowing this might even encourage customers to fill out surveys and provide your brand with even more personal information.
Is your business ready to deliver personalised shopping experiences?
The answer to this question is a resounding yes! While larger businesses may have more resources to invest in personalisation, there are plenty of ways that small to mid-sized e‑commerce businesses can get involved in personalisation techniques, depending on their budgets.
If your business has a limited budget, it’s important to start with the basics. Even with minimal investment, companies can still use segmentation to tailor their marketing efforts to different types of customers and offer personalised experiences without breaking the bank.
Another cost-effective way to get started with personalisation is to use website personalisation tools. Many of these tools are available at reasonable prices, making them accessible to businesses with a variety of budgets.
For businesses with slightly larger budgets, investing in customer relationship management (CRM) software can be a smart move. CRM software helps businesses manage customer data more effectively, making it easier to segment customers and deliver personalised experiences. Additionally, many CRM tools come with built-in marketing automation features, allowing businesses to automate personalised email campaigns or SMS messages without the need for a dedicated marketing team.
Finally, businesses with larger budgets can use more advanced personalisation techniques such as AI-powered product recommendations or personalised chatbots. While these techniques may require more investment, they can offer significant benefits to engagement, loyalty, and sales.
The bottom line is that businesses of all sizes can get involved in personalisation techniques, regardless of their budgets. By starting with the basics and investing in cost-effective tools and technologies, brands can still deliver personalised shopping experiences that resonate with customers and drive results.
If you want to get personal with your customer base but don’t know where to start, reach out via the button below. Our expert team will be thrilled to help!