Over the past 4 years, ecommerce in India has seen an influx of multiple online retailers. Despite a relatively lower internet penetration compared to the rest of the world, ecommerce has seen a tremendous growth in the country, with the market value expected to cross $38 billion by the end of 2016. With the Tata’s entry into the ecommerce space with Cliq, we can safely assume ecommerce is here to stay, and consumers will continue being spoilt for choice. It is also important to note that this increasing competition has kicked off a trend of providing a more personalised shopping experience to stay relevant; a trend that will play a pivotal role in deciding which players will survive to achieve long term profitability.
Building a Case for Personalisation
According to a recent study by Infosys conducted across omni-channel retailers in the United States, 86% consumers, and 96% of retailers claimed that personalisation has a positive impact on the purchasing decision. The same study also found that 31% consumers expect to see more personalisation in their shopping experiences. With the industry trends in India showing a higher percentage of online retailers versus multi-channel retailers, these statistics help build an even stronger case for personalisation in ecommerce. Personalisation is not only limited to replicating the experience of shopping in a physical store, but providing shoppers with an experience tailored to their individual purchasing habits. And by experience, we mean everything – from the first customer touch-point, to the product search results, personalized recommendations, promotions, content and communications.
A report by the CMO council states, “Over 54% of consumers would consider ending their relationship with a retailer if they are not given tailor-made, relevant products and offers”. Therefore, Personalisation is an essential tool for retailers to ensure repeat visits and strengthen customer loyalty, and to drive conversions leading to increased revenues.
Using Data to Power Personalization
According to a 2015 study by Retail Systems Research, “43% of merchandisers and category managers state that understanding customer preferences is their biggest challenge”. While there might be multiple variables at play, one cannot deny the power of data when it comes to making the right merchandising decisions. Retailers today have access to more customer data than they ever did. However, how this data is leveraged to understand customer preferences, shopping habits and their path to purchase, is what acts as a differentiator. Used intelligently, these data insights will not only help retailers determine what products to stock, but also how they are positioned, marketed and sold.
With a plethora of big data analytics tools at their disposal, retailers today have access to deeper and actionable insights they can leverage to sense change, understand patterns to ensure they stay ahead of the game, and stay relevant. Additionally, applying analytics to sales and interaction data ensures that companies are able to easily connect their consumers with the products they love, resulting in better conversions.
Adding Personalization to Your Website’s DNA
In order to drive conversions through personalisation, retailers have to ensure they address each layer of visitor engagement –whether it is the visitor’s first touch point with the retailer, the merchandising, or the customer intent.
In online retail, much like offline retail, merchandising is a key element of personalisation - and the one area where retailers can truly make their visitors feel wanted. The objective of merchandising is to display products in a way that stimulates interest and entices customers to make a purchase. In online retail, the role of data intelligence is crucial. Whether it’s geo-targeting, the season, or just new and relevant products – merchandising is all about leveraging this intelligence. This allows retailers to tell their visitors that they have come to the right place, and there’s no better place to shop but here!
Today’s new age merchandisers are armed with a variety of tools for site search, product recommendations, intelligent navigation, product comparisons, reviews and ratings, and many more. This coupled with the availability of site analytics tools allows them to better understand the impact of each decision on the conversions, sales and the basket size. The advanced A/B testing tools allow them to optimize the visitor experience based on what “clicks” with their visitors. And the simplicity of it all enables even the ‘non-technical’ merchants to make real time changes to the customer experience.
Personalizing According to the Customer Intent
Understanding customer intent is one of the most complex pieces of the puzzle that is personalisation and shopper engagement. If one were to draw parallels with offline retail, this is somewhat similar to employing that talented sales person who dramatically improves the chances of a customer purchasing a product from the store. And how exactly does he do it? By developing an understanding of the customers’ preferences, observing each aspect of their persona from the minute they walk into the store, and by starting a conversation to determine what they are really looking to purchase.
If we were to look at online retail, most of the shopper engagement ends with merchandising, with customer intent often being overlooked. This is where technology can be leveraged to provide visitors with context aware search and navigation, which prevents your visitors to run into irrelevant results, or a page which does not display any results. A simple, ‘Did You Mean’ page can prevent visitors from facing an unpleasant experience, or worse, abandoning the site.
One of the key elements of personalisation that has been missing in the industry thus far has been the ability to respond to customers’ personal interests and intent in real time. Coupled with product-based recommendations, data driven merchandising and segmentation - this could very well be the sweet spot they need to focus on, in order to get higher conversions.
As in the case of offline retail, the success of an online retailer can be measured by visitors finding more products they like – through better personalisation. And this in turn leads to better metrics like more views, more clicks, and higher engagement through more time spent on the website. Better metrics would further lead to return customers expecting another rewarding shopping experience, helping retailers achieve their ultimate business goal – loyal customers with an exceptionally “high lifetime value”
Authored By: Pavan Sondur, CEO & Co-Founder, Unbxd
Unbxd Inc, is an on-site product discovery software for ecommerce companies that provides search, navigation, product recommendations, merchandizing and analytics solutions for eCommerce companies. Unbxd’s products make it easier for eCommerce players to showcase targeted & relevant products and recommendations to visitors and track visitor interactions. Having been incorporated in October 2011, Unbxd has quickly grown into a leading personalisation, search & recommendations provider in India. The company’s core values are innovation, accuracy and reliability.