The Missed Opportunity of Digital Personalization

Personalization has been a buzzword in online retail for years. In today’s digital-first world, consumers not only look for a more intuitive and personal digital store experience, they expect it. Unfortunately, the reality is many major e-commerce players are missing the mark by relying on basic strategies that broadly target customer bases.

The gap is widening between consumer expectations and the reality of what e-commerce retailers are delivering. Reflektion recently commissioned a report that collected and analyzed data on the top 100 online retailers by visiting each of their e-commerce sites three times, including once on a mobile device. Our report, Digital Personalization: The Missed Opportunity, revealed that today’s consumers want experiences tailored to their individual preferences, but fewer than half of retailers are able to deliver. The good news is there are a few strategies retailers can implement to get personalization right and generate significant revenue as a result.

Retailers Must Learn to Deliver on Consumer Expectations

In order to deliver what consumers have come to expect, retailers must design the most engaging and relevant brand experience for shoppers at any given point of engagement. Findings from our report indicated the following: 

• Retailers must tailor “recommended products” to consumers. Only about four in every 10 e-tailers offered recommended products on their homepages that were updated based on a shopper’s browsing behavior, yet nearly half of consumers agree they like when retailers consider their past browsing history and online purchases when customizing marketing for them.
• Retailers are losing sight of the individual when they shop across multiple devices. Just 17 percent of homepages on retailers’ mobile sites featured personalized product recommendations based on shoppers’ browsing behavior from two prior desktop site visits while logged in under the same account.
• Limited site search capabilities are degrading the customer experience. One in five consumers are interested in using voice or photo search, but not a single top 100 retailer extended either option to shoppers through primary e-commerce sites. Instead, the majority of retailers relied on basic keyword terms to itemize search results and didn’t accurately guess what a shopper might be looking for based on browsing history.

How Can Retailers Catch Up?

There is a silver lining, however, for retailers. Strategies exist to successfully deliver an intuitive and personal experience to customers. And when done correctly, retailers can see bumps in site traffic, conversion rates and revenue.

Here are a few things merchants can implement to catch up to consumers’ growing expectations:

• Beef up search tools. Retailers in the study earned low marks for their failure to employ advanced site search tactics such as anticipating a shopper’s end goal. In many cases, online retailers treat their search bars like a dictionary lookup as opposed to an opportunity to show consumers products tailored to what they previously have expressed an interest in. In most instances, results are simply too voluminous for consumers to wade through on their own. This leaves them with the overwhelming task of finding what they’re looking for. This is a huge missed opportunity, and retailers must find ways to make their site search functions more like a thesaurus lookup — much like walking into a store and requesting guidance from an associate.
• Personalize emails and omnichannel efforts. Emails should be tailored to customers on a deeper level. Furthermore, clienteling needs to be unified for the store and online experience. Experts say such “real time” tactics that allow retailers to use contextual clues to make shopping predictions dramatically improve email and omnichannel campaign results and return on investment. Even merchants with above-average personalization track records say they recognize the importance of staying abreast of the latest email marketing tactics and are looking to unify the end-to-end customer journey.
• Think mobile. There’s a big problem for retailers that haven’t solved their mobile strategy problem. Today, mobile is almost preferred for e-commerce. A unique way to tackle this is by combining voice and photo search options.

Despite the fact that e-commerce represents the most data-rich environment ever seen, brands still aren’t doing a solid job at digital personalization. We’re in an era of retailers being challenged economically, and this is leaving hundreds of millions of dollars in incremental revenue on the floor. Retailers that take note of the poor performance of today’s top e-commerce players and do a better job of solving the personalization equation will gain a strategic advantage over their competitors.

Kurt Heinemann is the chief marketing officer at Reflektion, a next-generation personalization platform.