Personalization is fast becoming an essential, rather than optional, eCommerce strategy. According to research by McKinsey, 71% of consumers expect personalized interactions from businesses, and 76% get frustrated when interactions are impersonal. Nearly half of all consumers (48%) have abandoned a purchase on a business’s website because it was poorly curated.
Perhaps the more telling statistic is the number of customers who are willing to spend more on businesses that invest in personalization. According to research by Accenture, 91% of consumers say they are more likely to buy from brands that remember their preferences and provide relevant offers and recommendations. As social and mobile platforms offer consumers a curated and customized shopping experience, incorporating personalization into eCommerce is critical to winning and retaining customers.
If you’re considering eCommerce personalization strategies for your business, here’s everything you need to know and some tips for success.
What is eCommerce personalization?
eCommerce personalization is the practice of tailoring a customer’s shopping experience to match their individual preferences. It involves using customer information such as age or gender, past purchases, or browsing behaviors to dynamically deliver product recommendations, content, and special offers.
The good news is that customers are willing to provide information that can help businesses deliver a more personalized shopping experience. Salesforce found that shoppers would be happy to share their personal information if it would translate to more tailored experiences, including information such as birthdays, sizes, and phone numbers, as well as lifestyle preferences.
Benefits of eCommerce personalization
Increased revenue: Companies that succeed at personalization generate 40% more revenue from those activities than average players, according to research by McKinsey. In addition, personalization can boost conversion rates and ultimately increase sales. Results from research by Netcore/Wakefield show that for retailers, personalization can boost conversion rates by 45% on average.
Better customer experience: Every customer wants to feel seen and heard. Personalization ensures that customers receive content and product recommendations that are tailored to their needs. This translates to a more satisfying shopping experience, especially if personalization efforts are replicated across all sales channels.
Boost in customer loyalty: Customers who feel understood, seen, and heard are more likely to stick around than those who do not. According to a survey by Segment, 44% of consumers are more likely to become repeat customers after a personalized shopping experience with a particular company.
Increased average order size: The Netcore/Wakefield survey found that 28% of buyers are more likely to buy an unplanned product if a shopping experience is personalized, while 26% believe they may buy more expensive items. In fact, three in five retailers report a 10% increase in average order value after implementing personalization strategies.
The best eCommerce personalization tools for increased sales
As a business owner, there are a lot of personalization options available to you. Below are some of the most important tools to consider.
1. Your online store or website
Your website or online store is a crucial personalization tool. First, it’s usually the best place to collect firsthand customer data through opt-in or sign-up forms. Second, you can gather valuable insight by studying your online store statistics and then tailor content based on shopper behaviors. For example, you can offer a special discount to first-time shoppers in exchange for their emails and show customized product recommendations to returning customers.
Square Online offers personalized order screens to show customers dynamic landing pages based on their past interactions or activities, as well as a customized app-like mobile shopping experience for consumers shopping on their mobile devices. Customers can create accounts, track orders, and see personalized recommendations based on order history.
2. Text and email marketing tools
Email remains one of the most personal and direct communication channels open for your business, and according to the Square Future of Commerce report, 60% of consumers want to hear from businesses via email. Text and email marketing tools, such as Square Marketing, allow you to send personalized email campaigns and build a one-on-one relationship with your customers.
For example, you can send special email- or text-only offers based on previous purchases, or set up different types of automated campaigns, including welcome and win-back emails, birthday offers, and loyalty anniversary celebration emails.
3. Social commerce tools
Social commerce is on the rise as more sales continue to happen directly through social media channels. Consumers no longer need to leave their favorite social platform to make a purchase, which can mean a faster checkout process and fewer abandoned carts.
Social media feeds are algorithm-driven, and this could work in your favor as a business owner. If content from your page is recommended to a social media user, it’s probably because they’ve shown interest in similar products in the past, so they are more likely to buy from you. And if someone already follows your page, that shows they have an interest in your product or service. Your goal, then, is to ensure a seamless shopping experience for both new and returning customers and simplify the checkout process on their preferred social platform.
If you have a Square Online site, you can do this, for example, by syncing your Square Item Library to Instagram or Facebook so you can create shoppable posts. Since the sale happens directly on your Square Online site, you can collect valuable data that you can use in your marketing campaigns and loyalty programs to increase repeat purchases.
4. Visual commerce tools
Visual commerce involves using fascinating visual content and augmented reality to attract customers and improve their shopping experience. With visual commerce tools, you can generate product photos that are personalized and more meaningful to your customers, helping to create a customized shopping experience. For example, with a visual configuration tool like Threekit, shoppers can customize their products or create and preview 3D versions of a product in their preferred spaces before making a purchase.
5. Loyalty programs
Loyalty incentives can help enhance personalization while shopping, both online and in-store. Loyal customers are more likely to make repeat purchases: Square found that sellers who use Square Loyalty see a 40% increase in customer visit frequency. You can start a digital customer loyalty program from your Square Online site to encourage repeat customers, track purchases, and provide rewards and incentives that are tailored to specific customer segments.
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How to create a successful eCommerce personalization strategy
1. Segment your customers
The first step is to group customers based on shared characteristics, such as age, geographic location, or purchasing behavior. To create meaningful segments, study the customer data you’ve collected from all your existing sales channels and identify the customer groups that are most important to your business.
For example, the Square Customer Directory automatically creates smart groups like new, regular, and lapsed customers based on your sales data. These groups can be targeted in your email or text campaigns, or you can create other custom groups that fit your business.
2. Identify personalization opportunities
Once your customers are in distinct groups, you can start to brainstorm ways to personalize and improve the shopping experience for each segment. For example, you can create a welcome email campaign that is sent only to first-time customers. You can dynamically pull in the customer’s name and provide product recommendations that are similar to the items they just purchased. That way, the email is tailored to each customer.
You can also create new offers for specific customer groups and create or revise existing content on your website to meet the needs of different customer groups.
3. Deploy tools and technology that support your personalization efforts
Delivering cohesive, personalized experiences at scale is impossible without technology. You’ll need to find technologies that enable you to dynamically deliver personalized content, offers, or product recommendations. Square tools provide all the essential features you need to deliver a consistent and personalized omnichannel shopping experience.
Square Customer Directory, for example, is a free customer relationship management tool that is built into all your Square payment tools and gives you a 360-degree view of customer interactions with your business across various touchpoints. The Customer Directory helps you understand your customers better so you can make more informed marketing decisions and build a personalized, lasting relationship with each one.
Ecommerce personalization ideas to try
Below are some curated examples of eCommerce personalization you can adopt in your business.
Email/SMS: Send customers a special gift or offer on their birthday.
Website or online store: Show personalized product recommendations based on the product pages previously viewed by the visitor.
Loyalty programs: Send a special offer to customers who have earned a specified number of loyalty points.
Social commerce: Retarget customers who visited your website on social media using dynamic ads that feature shoppable content.
Visual commerce: Integrate a visual configuration tool that allows customers to customize their own products. Include user-generated content on product pages to drive more engagement.
By shared characteristic:
Loyalty points earned: Personalize offers based on the number of loyalty points earned or similar metrics.
Items in cart: Send automated cart abandonment emails with a time-sensitive discount to customers who have items in their cart.
Website behavior: Show a “continue shopping” section on the homepage to returning customers that features products they previously previewed.
Shopping behavior: Send a “We Miss You” text or email to customers who haven’t shopped in-store for a while.
Tips for delivering a personalized customer experience
Don’t be creepy. Avoid personalization techniques that consumers describe as “creepy,” like sending a text message or push notification when a customer walks by your store.
Don’t overdo it. One of the findings from Forrester’s research is that while consumers love personalization, they are annoyed when businesses personalize too early in the buying process or too often.
Ask for customer feedback. Customer insight is invaluable, especially when it comes to personalization. A wrong approach can cost you a lot of business. So, before you go all out on a strategy you think might work, consider testing with a small segment of your customers first and listen to their feedback.
Prioritize privacy. To excel at personalization, you’ll need to collect and use customer data. While customers are happy to provide their information in exchange for tailored experiences, they are also particular about privacy. Take appropriate measures to safeguard the customer information you collect.