Personalized Web Merchandising
Instead of just repurposing copy and images, rethink your Web catalog for more effective merchandising
Personalization and variable data printing are making their marks on the print catalog world, but the place where customized merchandising techniques are likely to shine is the Web. While a print catalog is static, a Web catalog is dynamic and can be generated in order to meet the needs of the customer at hand.
Explains Vahe Katros, director of retail applications at Blue Martini, a San Mateo, CA-based company that creates Web merchandising software:
There’s two issues to versioning catalogs: how many different merchandise assortments you can have, and how many items you can have in a given assortment. With print catalogs, the number of assortments is limited by printing and database technologies. The size of assortment is limited by paper and mailing costs in terms of how much you can afford to send to customers. There is no limit to the size or number of the assortments that one can deliver on an Internet commerce site. A million different people could have their own unique assortment with a million items each.
The first step many catalogers take when moving to the Web is “repurposing” catalog copy and images. Digital asset management makes this easy, but it is only the beginning. The added capabilities and limitations of the Web mean that the approach a Web catalog takes to merchandising should be different.
A Web catalog is non-linear, meaning that each user takes a unique path through the site based on his or her needs and choices. Effective Web merchandising directs that non-linear path so that the shopper finds the right products faster, removes barriers to checkout and upsells relevant add-ons to increase order size.
A Web catalog, then, can be customized to present fewer items to the shopper. Instead, it shows the right items with the right information. Each page can be dynamically generated—made to order—for each customer according to his or her need for products and deeper information.
Explains Katros, “There’s a depth of information that you can’t convey in a [print] catalog that you can on the Web. For example, you can’t put 20 pictures of the same sofa in different settings in a catalog, but on the Web you can drill down and show the sofa in different settings. You can explain how to care for the sofa and the choice of fabric. You can offer complements to the sofa, like a nice loveseat or a chair.”
Merchandising Goods
The Web simultaneously gives brand-new options to catalog marketers and reclaims some techniques that had fallen by the wayside.
Says Bill Evans, vice president of marketing at Blue Martini, “In retail, we’ve seen a transition from a high-service environment to an environment dominated by mass merchandisers. Consumers used to go to a store and someone would say, ‘That shirt would look great on you. This tie would go with that suit.’ That’s not the expectation any more. Personal selling is gone.”
Ironically, on the Web, even though there is no salesperson present, there is an opportunity to provide a more personalized experience. Shopping will be satisfying if the sizes presented fit and the cross-sell recommendations—-ties with a suit, tops with a skirt—make fashion sense. This can be accomplished with static upselling choices selected by a catalog merchandiser, or dynamically, with templates that present images and text triggered by rules based on users’ shopping patterns.
Protecting Privacy
The privacy issue is slowing the adoption of personalized Web catalogs. Marketers must balance consumers’ need for privacy with their own needs to target. One way to do so is to offer incentives for consumers to volunteer registration information. These incentives may be a rewards program, discounts or other material benefit, or may be compelling content, personal services or interactive features.
When consumers see a clear benefit, they are more likely to give information in return. The advantage of this permission-based model is that customers who prefer to wander through the site anonymously can do so. Those who wish to see targeted content can.
Once a consumer has registered, the site and offers can be customized through a manual log-in process or an automatic one through the use of cookies (small identifying pieces of data placed on a user’s hard drive). For example, Lands’ End’s site allows shoppers to register with the site voluntarily to access personalized services. Signing up for Lands’ End’s Personal Shopping Accounts allows shoppers to use My Personal Model, a 3-D mannequin that a female shopper can customize to her own appearance, including details of her coloring and body type. The site then suggests flattering outfits that the shopper can “try on.” The technology is supplied by Public Technologies Multimedia.
Examples of merchandising techniques that rely on self-described data rather than profiling technology include personal shopping lists, e-mail notification and gift registration.
Self-personalization, however, makes two assumptions: One, that consumers know what they want, and two, that they tell the truth. A principle of direct marketing is that consumers don’t know they want a product until you tell them, and a fact of the Web is that people lie. According to Betsy Zikakis of Engage Technologies, Web statistics show that “62 percent of people don’t tell the truth. And even when they do, often intentions are very different than actions.”
Instead of relying on self-described information, Engage tracks user behavior across a network of sites with cookies that create anonymous profiles that network members can tap to customize sites for users. This technology has been adopted widely for serving targeted ads, and soon content and offers will follow.
So how far should personalization go? Customization is most effective when it’s behind the scenes. Slapping a brazenly personalized greeting on a site can be unsettling, but when customization is well done, consumers may not even notice it. Instead, they get the feeling that the merchandise is exactly what they were looking for.
The key, according to Kevin Faulkner of RightPoint Software, which creates targeting tools for the Web and call centers, is making relevant offers that will be perceived as services. Identifying them means thinking about customers and businesses in a different way.
“First start with the problem you’re trying to solve,” advises Katros. “For example, maybe a gift catalog isn’t truly in the gift-giving business. It’s in the time-saving business. Gifts can be the first step, just as Amazon started with books and moved on to videos, toys and electronics. There is no reason why a company is only in the gift business and not the time-saving business, which instantly gives them directions in which to grow.”
Faulkner explains the advantages of individualizing offers to your customer:
A) They’re likely to buy more because you’ve recommended products they need.
B) They’re more likely to view your site as helpful because you’ve directed them to what they wanted.
C) They’re more likely to come back again.
“You want the customer to feel that everything is a service,” he says. “Over time, it won’t be price that drives sales, it will be the experience that the customer has with you.”
Martha Rogers of Peppers and Rogers Consulting says that the Web requires a shift from product management to customer management.
Rogers says, “When you concentrate on customer management, you think about how to keep the customer, increase customer share, cross-sell them, increase lifetime customer value. If you define the success of your company in terms of profitability from serving your customer, it gives you a different list of things to do tomorrow.”
