Using Ecommerce Personalization to Deliver Engaging Customer Experiences

Ecommerce personalization is a powerful way to tailor the customer experience to each shopper. Learn how it works and how to use it in this article.

As shoppers and buyers, we only care about ourselves. We want our shopping experiences tailored to our needs. We want the messaging to speak to us. We want our preferred products placed front and center and we don’t want to see products we would never buy.

How do you create an experience like this? Through ecommerce personalization.

It’s a powerful way to build highly targeted experiences — at scale — for your customers.

In this article, we explain what ecommerce personalization means and how to prioritize it.

Then we break down some examples of ecommerce personalization to help you implement it in your store to create an amazing user experience.

What’s Ecommerce Personalization?

Before we get into the nitty-gritty details of personalization, let’s make sure we’re all on the same page. It’s a relatively simple concept. In conclusion:

Ecommerce personalization is the practice of tailoring the shopping experience of an online customer to their individual preferences and characteristics.

This can be achieved through various means, such as:

• Recommending products that are similar to those that a customer has viewed or purchased in the past
• Displaying personalized product recommendations on a home page or product page
• Sending targeted email campaigns with personalized product recommendations to customers.

Personalization can also extend to other areas of the shopping experience, such as:

• The design and layout of a website
• The language used in marketing materials
• The overall tone and messaging of a brand

The goal of ecommerce personalization is to improve the customer experience, increase customer loyalty, and drive sales.

Ultimately, through personalization, each customer experiences a slightly different version of your website. That real-time experience is being shaped and defined by the particular audience segment the shopper falls into. These segments can include:

• Past purchase history
• Browsing behavior
• Demographics (age, ethnicity, location, income level, etc.)
• Psychographics (interests, habits, emotions, attitudes)
• Other segments

Once a website visitor has been properly segmented, dynamic customization takes place. Customization tactics include:

• Unique offers or coupon codes
• Inline content
• Targeted pop-ups
• Infobars
• Product recommendations
• Product cross-selling
• Best-sellers
• Other tactics

When Amazon suggests other products that supplement the items in your shopping cart, that’s personalization.

When you’re looking at tents on REI.com and they point you to a tent-buying guide they’ve created, that’s personalization.

When you’re on Zappos and you get a discount coupon because it’s your birthday, that’s another form of personalization.

At its heart, ecommerce personalization is about presenting a customer with the right offer and information at the right time so you can maximize conversions and give the customer a pleasing shopping experience. The goal is to be as relevant as possible to the potential customer in order to generate a conversion.

The Power of Ecommerce Personalization

Just how effective is ecommerce personalization? Incredibly so!

For starters, shoppers love personalization.

80% of consumers are more likely to buy from a company that provides a tailored experience and 66% of consumers expect brands to understand their individual needs.

90% of shoppers find the idea of personalization appealing.

Ecommerce personalization creates a genuine impact on your bottom line. Companies that use advanced personalization report a $20 return for every $1 spent.

It helps you achieve your business goals as well. Personalized experiences are known to boost many key ecommerce metrics, such as conversions, average order value, and revenue growth.

According to AdWeek, personalization efforts can increase your revenue, reduce customer acquisition costs by 50%, and increase marketing spend efficiency by 30%.

Those are huge gains!

And here’s our favorite bit of data: According to Monetate’s study of the top 1,000 retailers, 95% of companies that saw an ROI boost from personalization further increased their profitability the next year.

That means your personalization work continues to boost your conversion rates and revenue for the long term.

Personalization is such a powerful boost to the customer experience that many customers have grown to expect it. Optimizely highlights just how much customers expect personalization when they say:

“Consumers’ expectations have shifted to the point that people expect a personal digital experience that mirrors the typical level of personalization they receive offline. Many have grown accustomed to personalized experiences from their news feed, social network, and shopping recommendations.”

In other words, Facebook, Amazon, and Google have spoiled us to the point that we expect extreme personalization everywhere we go online.

We think that every ecommerce website should be able to make recommendations like Amazon and help us find information like Google. If a site can’t do that, we’ll shop somewhere else.

But despite the effectiveness and importance of ecommerce personalization, very few marketers know how to implement it. As Yes Marketing noted regarding a recent survey by Shop.org:

“However, the Shop.org survey found that brands and retailers are still stuck on the simplest forms of personalization. Many are missing opportunities to improve their efforts and therefore increase conversions.”

All this to say: Personalization matters very much to consumers, yet very few marketers know how to properly implement it.

This personalization gap creates an opportunity for you to gain an advantage over your competitors.

If you can properly implement personalization on your site, there’s a good possibility you can take market share and revenue from them.

Prioritizing Personalization

Before you dive into personalization, keep one thing in mind: It’s heavily dependent on the user experience, especially if you hope to use personalization to boost conversions.

If your website isn’t designed to give users a seamless, pleasant shopping experience, personalization won’t help much. Personalization can’t save a clunky, confusing, or frustrating website. That’s why ecommerce personalization is, first and foremost, a conversation about prioritization.

Before you begin deploying personalization across your site, there are other areas that require your attention. Most sites need conversion rate optimization before personalization will even be the least bit effective. We recommend the following six-step process for personalization.

Step #1: Fix the glaring errors

Before you even think about personalization, you need to fix obvious mistakes on your site such as typos, slow page loads, shopping cart bugs, glitches, etc. These errors will send visitors running so fast that no amount of personalization will ever get them back. If you don’t fix these errors, you damage your credibility and violate the trust of visitors.

Step #2: Create a pain-free user experience

After fixing the most obvious errors, it’s time to focus on giving site visitors a pleasant, pain-free shopping experience.

This requires diving deep into site analytics, heat maps, user testing, and surveys to determine where visitors might be having problems on your site. Once you’ve identified potential problem areas, form and test hypotheses to fix the problems.

To reiterate, if you don’t create a pain-free user experience, personalization won’t help you. After all, if a user is confused by your website navigation structure or the checkout process, personalization can’t solve that problem.

Step #3: Put high-quality content in the right places

Ecommerce relies on content more than standard brick-and-mortar shops. After all, your customers can’t physically touch your products or see them in person. They rely on the product descriptions, specifications, photos, and videos you provide. So the next step is to ensure that you have rich, high-quality content in all the necessary places.

• Do you have multiple high-resolution photos for each of your products?
• Is it easy to compare different types of the same product on the same page?
• Do you use “lifestyle photos” so that customers can envision themselves using the products?
• Do you have rich, in-depth product descriptions that answer customer questions and overcome potential objections?
• Do you include customer reviews so new customers can be confident in their purchases?

Step #4: Optimize navigation around your best customer segments Segments

If you’ve taken the time to study your numbers, you should know which segment(s) of your audience provides you with the highest Customer Lifetime Value (LTV). Once you’ve determined which segment this is, make it as easy as possible for them to purchase from you.

Create a simple, straightforward buying path that will guide them from the moment they visit your site to their final purchase. Evaluating your analytics, heatmaps, and user research tools can help you determine if there are any areas of your site where these valuable customers tend to get stuck, confused, or frustrated.

Once you identify these areas, focus on simplifying the buying path. Clarifying the buying path for your highest LTV customers before implementing personalization will maximize the revenue from this segment when you finally start personalizing.

Step #5: Provide incentives for those who hesitate

Now that you’ve completed the first four steps and optimized your site for conversions, you can begin the personalization process. Start by offering incentives to those who hesitate to purchase (i.e. they’ve visited in the past and haven’t purchased).

If a customer has browsed work boots in the past, show him a bigger selection of work boots. If the visitor is from Sydney, where it’s the rainy season, show her rainy weather gear. Or simply offer them some sort of offer to get them to open their wallet, with the prospect of upselling or cross-selling down the road.

Step #6: Personalize for undiscovered segments

If you follow steps 1–5, you’ll inevitably discover an audience segment you didn’t know you had.

This untapped pool of customers represents yet another source of revenue, and ecommerce personalization can help you unlock it.

Discovering this new group of customers is your reward for thoroughly optimizing your site and personalizing it for those who hesitate to purchase.

Ecommerce Personalization Examples

We’ve covered ecommerce personalization from a high level, so let’s now look at some specific examples. Use these ideas to inspire your own personalization efforts.

1. Moo’s dynamic content

MOO is a UK-based stationery brand. Their homepage is a masterclass in personalization, offering dynamic content based on visitors’ purchase history.

Offers, banners, and even the page’s language change based on what MOO knows about the user. The data used to populate this content is stored in the backend (for visitors logged into an account) or a cookie stored on the user’s device.

Furthermore, MOO uses location-based personalization to deliver targeted content based on visitors’ city or country. For instance, the site’s currency values change depending on your location.

2. Branch’s product quiz

A product quiz is a straightforward and effective means of ecommerce personalization. The goal is simple: Learn exactly what the quiz taker likes and then direct them to those products.

What’s great about a quiz is that it offers a low cognitive load. It doesn’t ask the user to learn about your products or think much at all. They answer simple questions about themselves (which should be easy) and get directional guidance to products that accurately fit their needs.

Branch makes this part of product discovery refreshingly simple. All you have to do is answer a short series of questions (5–7 questions depending on your replies).

At the end, you’re presented with a product (or a small selection of products) that meets your criteria.

3. Simple Tire’s search history

It’s not unusual for shoppers to perform multiple searches to find products they need, especially when those products have unique specifications, like size or compatibility. You can personalize this part of the experience by remembering what they looked up last time.

Simple Tire uses past searches to help users navigate quickly to products they’ve searched for in the past. When you perform a search, the site remembers and offers quick paths back to that same information.

For instance, suppose you search for a make and model one day…

…and then return to the site the next. Simple Tire helps you pick up where you left off.

4. Etsy’s personalized recommendations

The last thing you want is for a customer to feel like they’ve reached a dead end. But that’s exactly what happens in many cases when a customer decides that the product before them isn’t right. Going back to the search results can feel overwhelming.

Etsy is smart about keeping its customers moving forward by personalizing the product landing page. This gives more visibility to other products that match the user’s search query.

This type of personalization is especially helpful for paid traffic that tends to convert poorly. Every opportunity you give them to buy something is valuable.

5. DSW’s “top picks for you”

DSW uses a quintessential bit of ecommerce personalization. It’s simple but effective, so we didn’t want to leave it out.

Over time, as customers engage with DSW’s site, brick-and-mortar stores, and email campaigns, the company builds a profile on each. They use this data to display personalized content throughout their site. This “Our Picks for You” section is the most obvious example.

Additionally, this data is used to design email campaigns, SMS campaigns, push notifications, and even the offers customers receive on their in-store email receipt.

6. Old Navy’s wish list

If you visit Old Navy’s website, data is collected regarding your product page views and any products that were abandoned at checkout.

The site displays these products as a “wish list” upon your next visit. They also use this curated selection in email campaigns to drive customers back to the store.

7. Dick’s Sporting Goods’ “hot in your area”

Visitor location can influence their purchase decisions. Trends, styles, and activities often follow local patterns. No one knows this better than Dick’s Sporting Goods. When you arrive on the site, it quickly reads your location and offers the hottest products in your area.

This is a great example of how personalization can be combined with social proof. Some shoppers will feel compelled to buy those products because they feel it will make them part of something special in their area.

8. Amazon’s location-specific delivery details

It’s no surprise that Amazon has invested deeply into personalization. One way they create a personalized experience is through their delivery details. They know where the item is and where you want it to go, so they have everything they need to make a good estimate.

Including this level of detail helps ease customer doubts. It also helps them make planning decisions in case they need the product at a specific time.

9. Zalando’s marketing preferences

An important part of ecommerce personalization is serving the content your audience wants to see and holding back the content that doesn’t interest them. How do you tell the difference? The easiest way is to just ask.

Zalando segments its email subscribers with a simple field on their sign-up form. This probably isn’t their only method of segmentation, but it’s a good start at sorting their new subscribers.

10. Crate & Barrel’s main navigation

In some cases, an ecommerce site’s main navigation becomes so complex that users struggle to find anything. There’s a limit to the amount of energy your customers will spend trying to understand your links.

Crate & Barrel recognizes that customers will use their navigation in different ways, so they want their links to be organized to meet everyone’s needs. They do this by using a main “Furniture” category that houses different furniture collections (bathroom, living room, dining room, etc.). This allows customers to search by their own need, rather than looking for specific items.

All of the items are available in other categories as well, thereby allowing customers to find products in whatever manner suits them without cluttering the navigation.

Your Customers Want Personalized Experiences

Your customers want personalized experiences that meet their needs quickly. Simply put, if you personalize their experience, they’ll reward you with their business.

Use the examples we laid out to inspire your own personalization efforts.

That said, let us caution you again about the importance of optimizing for conversions before you begin a personalization strategy.

If you don’t first optimize your site, personalization won’t make much difference.

You’ll spend valuable hours and dollars trying to craft personalized shopping experiences, only to have customers purchase elsewhere because your site wasn’t properly optimized.