CX personalization is an exploding e-commerce trend that’s going to be with us for a long time.
In fact, it’s a little like Pandora’s Box: now that the lid’s lifted, there’s no possibility of stuffing the contents back inside and closing it up.
Customer experience (“CX”) has always been an important element of online seller/buyer relationships. However, as those of you who have been keeping up with e-commerce trends lately know, CX has taken on new meanings in 2021. It’s currently a huge deal in e-commerce retail.
The forces driving greater CX personalization have been building for quite a while.
After all, brands and e-commerce retailers internationally are now dealing with consumers who want greater transparency, greater engagement with their favored vendors, and more immersive experiences that go well beyond the completion of individual transactions.
Consumers are looking for brand relationships.
Greater CX personalization is therefore not optional. Stronger brand relationships require it. Immersive brand storytelling and social media marketing can’t be truly effective if consumers don’t feel a sense of unique personal connection.
In fact, there’s a big push currently to enhance CX with technology and tactics aimed at increasing personalization in consumers’ interactions with e-commerce retailers.
A Little Perspective: How Did Things Get So Personal?
Let’s step back just a few years.
A 2017 Sitecore study yielded several important conclusions about the state of CX personalization at the time. The results weren’t encouraging.
It turned out that as of four years ago, a majority of brands were already trying to prioritize personal relationships with their consumers. They also recognized an increasing need to use gathered data effectively to drive marketing decisions and enhance CX personalization. Unfortunately, they had serious problems gathering good data and then using it appropriately.
A vast majority of consumers surveyed at the time recognized the phenomenon of “poor personalization,” based on brands’ use of poor, outdated, or inaccurate consumer data and their incorrect assumptions about consumer interests based on it.
The study also made it clear that consumers gave brands too much credit for possessing accurate information as to their preferences and history, and that brands themselves admitted to struggling with data collection and decent, actionable analytics.
In fact, of the brands surveyed in the Sitecore study, 20% lacked a means of collecting online customer data. At the same time – and let’s remember that this is four years ago – at least 75% of the consumers Sitecore surveyed were interested in greater personalization.
In 2017, poor personalization and the accompanying lack of consumer trust led to more than $750 billion in lost business.
Welcome to Today: The Drivers of Personalization in 2021
Since the Sitecore study, consumer interest in greater personalization has grown faster than the retail industry’s ability to address it.
Consumers are more willing today to share their personal details in the expectation of more personalized and engaging brand experiences. Data from Accenture suggests that as many as 91% of them will likely make purchases from vendors who build personal customer relationships.
That trend was growing before 2020 arrived, bringing with it the various “gifts” the world experienced over the year. We’re now in 2021’s second quarter, and e-commerce retailers have a new sense of urgency in personalizing CX.
- Customers are clearer than ever about their dislike for experiences that make them feel like little more than account numbers. We know this seems obvious, but many brands haven’t been doing a great job in addressing the impersonal aspects of their CX.
- In the past, CX – at least from the retailer’s perspective -- was about functions surrounding a transaction. These included specific customer service interactions, support issues, phone and voice chat mechanisms, and matters of timing. The human or organic aspects of these areas took a back seat to broad functionality. That approach no longer works for a great many consumers.
- Consumers have always preferred conversational language and “direct exchange” experiences that lend humanity and a sense of personal contact to transactions, and help brands create ongoing relationships. Now, it’s no longer a question of mere preference. Consumers are increasingly demanding personal – and personable – exchanges with brands and looking for relationship experiences outside the purely transactional.
E-commerce retailers and the retail tech sector are undergoing a period of forced evolution to respond effectively.
The changes are happening on various fronts, including the incorporation of voice technology, AR, AI, and hybrid tech that all serve a direct, intimate, and conversational approach to CX personalization.
In fact, it’s fair to say that instead of successful transactions driving CX innovation and improvement, it’s actually the other way around. The more personalized and accessible your CX appears to consumers, the better your bottom line will be.
Investment in better and more personal CX is generating more engagement, longer relationships, greater trust, and more completed transactions, based on interactions across channels.
Exactly What is CX Personalization?
If you want to up your CX game by offering more effective e-commerce personalization, you’ll need a clear understanding and some recognizable benchmarks from which to start.
There are some different but overlapping definitions floating around, and the good part is that you’re already familiar with them.
Most definitions include the use of relevant customer data to make suggestions on which consumers will be more likely to act, especially when those suggestions improve the “customer journey” so that shopping is more rewarding and more enjoyable. If your current CX personalization doesn’t rely on this approach, at least in part, you may lose business through shopper frustration.
The kinds of data that should form the basis for your personalization efforts include details of your shoppers’ browsing behavior and purchase history. This information provides a foundation on which to build exciting interactive content and multichannel experiences to draw your shoppers into your brand (as opposed merely to interesting them in a single product or transaction).
You’re after information to form the bases for strong predictive analyses.
We know you’re probably already using conventional methods (like cookies) for getting this sort of customer data, but as you’re probably aware, things are about to change.
Make no mistake about the “predictive” bit: enhanced CX personalization is all about showing site visitors want they want to see quickly and accurately. According to Janrain (now part of Akamai), it’s about ensuring that what they experience is pleasant and relevant to their interests within individual visits, and from visit to visit over time.
Failing this, you can lose three-quarters of your site visitors through lack of relevance.
If you understand the basic nature of CX personalization, what specific benefits can you receive from your investment in enhancing it?
Most of the benefits are obvious.
- Customers who discover what they want quickly in a pleasing environment will have a positive experience, especially if they don’t have to put up with irrelevant content, annoying unrelated advertising, pop-ups, and unwanted links. If you remove the most common irritants that drive customers from sites, they’ll hang around longer, engage more easily, and find reasons to trust you.
- A visually richer, more focused, and more engaging CX will extend shoppers’ attention spans, which are often frighteningly short. If you offer relevant, particularized content, they’re likely to explore your site more fully, giving you more opportunities for connection and conversions.
- Investment in personalized experience automatically leads to greater engagement with the content you choose to offer, and to an increased likelihood of shoppers finding items that meet their wants or needs. It also improves the odds that visitors will explore other on-site offers and make unanticipated purchases of opportunity.
- When site visitors encounter a personalized, welcoming environment and are then able to find both items they want, and items they discover they want while looking for other things, their level of engagement goes up dramatically. So does their interest in returning to your site. If their customer journey from initial visit to purchase is positive and engaging, you’re building loyalty and increasing retention.
In terms of ROI in greater CX personalization, what’s not to like?
Consider the case of Sweetwater, the large online vendors of musical instruments and related gear. They flourished during 2020, despite partial lock-downs and e-commerce retail’s wild roller-coaster ride, because personalized CX has always been both a core value and focus of ongoing development and staff training for them. Their user experience and customer service principles and practices are well integrated and highly adaptable.
You can’t argue with the results.
Experience Rules the Day: Useful Tactics for Your New CX Personalization Strategy
Major changes in cookie usage are coming very soon. For now, what you need to know is this: your focus in terms of permissible cookie usage and data gathering should be on first-party visitors to your site.
The changes to come are unlikely to interfere with your existing ability to gather good data from first-party users under existing legislation and practice.
Let’s assume for the moment that whatever changes come, you’ll have been wise enough to invest in whatever altered means of customer data acquisition actually replaces current cookie usage. What tactics could you employ to enhance your shoppers’ CX?
- When you gather useful data and have sound analytics, you acquire the ability to offer each shopper a personalized home or landing page and style guides that reflect the shopper’s interests based on items searched initially, prior purchases, and related seasonal or location-based offers appealing to market segments.
- As you learn more about each customer, you gain the ability to customize email and social media messaging to the point that the recipient no longer views your communications as impersonal or form-based.
- Onsite, you can selectively and sparingly use targeted product or service recommendation pop-ups or banners based on individual or segment user data.
- You can offer occasional gifts, individualized promotions, and category discounts based on product views and shopping history.
- You can design and use segment-targeted CX surveys and individualized quizzes intelligently to reap huge benefits in terms of actionable shopper data and greater personalization.
- You can consider investing in e-commerce personalization tools that offer multiple integrations to assist with personalization through customized navigation, flexible segmentation, comparative testing, pricing, and more. Such tools include offerings from Dynamic Yield, OptinMonster, Barilliance, and others.
Final Thoughts and Changes to Come
We believe you’ll find that investments you make in improving your CX personalization (especially if you’re taking a multi-channel or omnichannel approach in content strategy and marketing) will offer great ROI.
It’s also safe to assume that e-commerce personalization tools will become increasingly sophisticated, more practical, and relatively affordable – and they’ll become necessities rather than items on retailers’ wish lists. We’ll revisit this area with you soon to help clarify the functions such tools perform and the ways you might apply them in your retail business.
There will be much to discuss, given that (as we mentioned) normal cookie-based data gathering is soon coming to an end. We’ll be looking into that for you as well.
A little proactivity will go a long way…