How to Boost Sales and Margins With Behavioral Commerce, Part 1
Behavioral commerce, the practice of delivering real-time offers to consumers based on their shopping personalities and buying behaviors, is a hot trend in retail. Today's consumers expect a one-on-one experience, therefore retailers must know their audiences and their shopping personalities to tailor the experience for them.
Most sites treat every shopper as if they’re the same. They’re not. Some will only buy premium name brands, others will never buy on their first visit no matter what you offer them and others won't buy at all.
Online retailers need to do the following to overcome these hurdles:
1. Act in real time to influence buying behavior while site visitors are still shopping. This gives you the greatest likelihood of the best outcome. For nearly all online retailers this is a daunting task, however, as they’re often cobbled with a web of disparate data warehouses, data analysts, engineers and an overwhelming number of potential marketing opportunities.
2. Maximize revenue and margin by only offering incentives when it’s absolutely necessary. To generate conversion, online retailers too often give the exact same offer to everyone when they don’t need to. Knowing the different types of buying behaviors and shopping personalities your site attracts helps you know which group needs a discount or special offer to convert and, even more important, which group doesn’t.
SteelHouse, a behavioral targeting firm, has done extensive research and analysis of anonymous shopping behaviors to determine the 10 most common shopping personality profiles. See if you can identify yourself with any of these shopping personalities. Here are first five:
1. Distracted Shopper: “When I shop online, I often like to begin the check-out process but for one reason or another I don’t always complete the purchase.” This type of shopper is frequently distracted and probably multitasking while shopping.
To close the deal: Offer 10 percent off their next order if they complete this one. You can also show them the types of products they were browsing but didn’t end up purchasing. In most cases it's enough to remind the shopper to return and complete the purchase.
2. Premium Shopper: “I only buy the best. I want premium name brands with the latest features, trends and most advanced technology.” This shopper is a trendsetter who doesn’t mind showing off or inciting a little jealousy in their friends.
To close the deal: Show this shopper new goods that just arrived. You can even increase their average order value if you throw in a small offer if they reach a high order value threshold. They’ll appreciate the recognition.
3. Determined Shopper: “I always research before I buy. I'll view the exact item I want multiple times, looking for a drop in price or an offer.” This shopper wants to be absolutely certain they’ve made the right choice before buying.
To close the deal: Provide positive reinforcement during their shopping process. Show them that this is the right product for them. Show positive consumer feedback on the items they're browsing and, if necessary, provide an incentive like $10 off for them to write their own review of a product.
4. Active Shopper: “I'm always browsing but not always buying. I'm not looking for incentives, but they can help me convert when I’m window shopping.” Active shoppers like the positive psychological effects of browsing products online across different sites.
To close the deal: Try secret sales, daily deals or flash sales to push these shoppers over the hump. Try offers that show additional items that complement what they’ve been browsing, which often helps them see the complete outfit or package and in turn has them purchasing everything.
5. Free Shipping Hunter: “I like to buy online, but if the retailer doesn’t offer free shipping, I’ll leave and find a website that does.” This shopper is turned off even if the shipping costs are minimal.
To close the deal: Offer free shipping if the shopper continues and completes this particular purchase, or give it to them on their next order if they complete the current order.
Knowing the shopping personalities and buying behaviors of the people who visit your site will help you boost sales and maximize margins. Stay tuned for shopping personalities six through 10 in tomorrow's issue of ROI Report.
Mark Douglas is CEO of SteelHouse, a behavioral targeting firm.
