As the world has changed, so too has the behavior of online shoppers. The main, but far from the only, metamorphosis is that they have become less loyal to old brands. In addition, the positive online retailers feel about the increase in traffic is accompanied by concerns about a potential economic downturn, which will also affect shopper behavior.
These trends are reflected in recent e-commerce studies, according to which, in 2020, the main goal of the largest companies was not to increase conversion and the number of new customers, but to retain existing customers. Personalization, as before, helps online stores build long-term relationships, but now this tool has to be used with adjustments to new conditions. Today, we will talk about how the role of personalization has changed by the fall of 2020, and what marketers should do now.
How Business Attitudes to Personalization Are Changing
According to a July 2020 Yieldify study in the UK and US, personalization has been implemented by 50% to 70% of the largest online retailers. Researchers predict that this figure will exceed 90% by the end of 2021. More than half of the ecommerce marketers surveyed cited customer demand as the reason for using this tool. Thus, according to the same study, 75% of users expect personalized online experiences from companies.
In addition to the website, retailers are also personalizing other communication channels with customers: mobile applications, email, SMS, loyalty programs, etc.
Personalization of online channels
What companies use for personalization
Most often – in 76% of cases – the largest British and American online retailers personalize offers depending on the user’s behavior on the site. Thanks to this, they offer each client dynamically changing content in real time that meets their individual needs. Instant response to the client’s actions allows them to engage in communication, encourage them to take action and confidently lead them along the conversion funnel. All this is quite consistent with the precept of Steve Jobs: “You must start with the customer experience and work backwards from there to the technology.”
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The second most popular source of personalization
For 63% of companies – is individual user profile data stored by the customer data platform. It collects and processes all available information about each client, and further interaction with them is built on the basis of this data.
Cookies are perhaps the oldest, but no less reliable “assistant” in personalization. They are used by 62% of the car ownership data surveyed companies. “Cookies” not only make it easier for the user to log in and autofill forms, but also allow the marketer to understand where the client comes from to the site and how he behaves there.
And the fourth thing that 62% of companies rely on when personalizing is the use of various communication channels. For example, the correct segmentation of email campaigns allows you to deliver relevant messages to different clients: loyal users receive letters with exclusive offers, and “sleeping” ones – with personal discounts.
Sources for personalization
At the same time, TouchPoints in its study identified 5 popular technologies that companies use to improve personalization. Among them, in addition to the mentioned customer data platforms, they highlight tracking customers phone number lt through social networks and mobile gadgets, as well as the use of predictive analytics and chatbots.
Technologies for personalization
By the way, according to the previously mentioned Yieldify study, only 54% of US and UK companies use AI-based forecasting.
What does business expect from personalization
The pandemic has changed the behavior of online users. Now, when choosing a product, availability (due to disrupted supply chains) and price (due to economic uncertainty) have become the most important factors for them, according to the study.
The decline in brand loyalty differs by country, with retailers in India (92%) and China (82%) seeing the biggest declines, while shoppers in Japan, Germany and France remained more loyal (down 33%, 54% and 59% respectively).
The reasons why consumers seek new experiences are also different. In addition to such eternal factors as price and availability, hygiene and health benefits are now important to them.
In response to user behavior, companies have also changed their priorities. Now 59% of them set customer retention as their main goal: in 2020, this indicator overtook conversion (55%) and acquisition (45%) in importance for them.
Tips for Marketers
To focus on the experience of leading global companies or to go your own way – everyone decides for themselves. But we still offer the first option. Therefore, we share recommendations based on the implementation of personalization by market leaders.
1. Consolidate customer data into one system
A powerful platform that stores and processes customer data has become a “must have” by the end of 2020. If information about the user and their behavior from different channels is not linked into a single profile, communications with them may become disjointed, and statistics may be incorrect.
Retail Rocket has a Data Warehouse for this purpose , which combines online and offline customer data (CRM, loyalty programs, website, application and other sources) in one place and allows you to quickly create segments for any marketing tasks.
Data Warehouse
2. Consider offline when communicating online
During the isolation period, customers missed shopping in real stores, but got used to online communication. Omnichannel retailers can use this trend to their advantage. To do this, they must take into account information about purchases that a customer makes in a physical store when interacting with them in digital channels. To achieve this, it is necessary to establish the transfer of data about goods purchased by the customer in offline points to a single system, which was discussed in the previous point.
This is exactly what DIY retailer MaxidoM does, for example. After making a purchase in one of the company’s physical hypermarkets, customers receive emails with recommendations for related products:
Personalized product recommendations
3. Improve personalization with new technologies
We have already listed the 5 most popular technologies that companies use to improve personalization. However, this list can be continued. Facial recognition technologies, machine learning, augmented reality and others are gradually becoming more established in our lives and are finding application in retail.
Thus, virtual fitting rooms are becoming increasingly popular in fashion stores, and the retailer Hoff offers the help of AR to imagine how this or that furniture will look in your home.
AR for personalization
4. Consider delivery methods
Since the virus has not yet been defeated, many buyers are still trying to minimize physical contact. This is why such methods of receiving goods as parcel terminals and pick-up points are becoming more popular. Such preferences also provide insight into the user’s behavior, allowing us to recommend appropriate products to them. For example, if a person does not sit at home and goes shopping, they will need sets of medical masks.
5. Notify about the appearance of goods
Due to the disruption of supply chains, many products temporarily disappeared from the shelves of online stores. Users were faced with their absence and either went to another store or waited for the product to return. Trigger emails help to communicate the good news about its reappearance. Similar to those sent out by the Kanzler online store.
