Retailers are facing a more challenging environment than ever before: they’re losing share to marketplaces like Amazon and facing a growing threat from direct-to-consumer brands. But it’s not just competition from other retailers—consumers are choosing to invest in experiences over things and, increasingly, have higher expectations when they do shop. Today, consumers expect a relevant and personalized experience each time they open an email or visit a retailer’s website; in fact, brands see a lift in sales and loyalty after implementing personalization strategies.
Customers Expect It…but Brands Need to Get It Right
There’s been a shift in what consumers expect from an online experience. More than half of all shoppers say personalization is an essential part of the shopping experience and three quarters feel frustrated when retailers fail to deliver. If a brand gets information wrong, such as failing to connect the online shopping cart with the mobile app, or gets the consumer’s name wrong in brand communications, 37% say they are less likely to make a purchase and almost a quarter will unsubscribe from email.
Personalization Helps Consumers Decide
Consumers value variety and want to choose from several product options, but too many choices can be overwhelming. Consumers value services that simplify discovery and make the decision process as easy as possible. While 72% of consumers have experienced “you might also like” recommendations, only half have received emails showing items the consumer might like based on past purchases and less than a third have experienced a personalized website home page. Personalization data mined from past purchases and on-site behavior intuitively helps consumers discover the products they want—sometimes even before they know they want to buy them.
Personalization Drives Impulse Purchases
When marketers make it easy for consumers to discover the products they want, consumers are compelled to buy. Researchers found that almost half of consumers purchased a product they did not initially intend to buy after receiving a personalized recommendation from a brand. More important, only 5% of those consumers said they returned their impulse purchase.
Personalization Leads to Loyalty
When brands deliver relevant content, consumers feel the brand understands them and this exchange builds trust and loyalty—44% of consumers say they are likely to become repeat customers after a personalized shopping experience with a brand. Positive sentiment resonates beyond the shopping experience: 32% would leave a positive review of the product of brand, 39% would tell friends and family, and 22% say they would post a positive comment on social media.
To execute personalization effectively, brands must create a view of the consumer that spans channels, employs dynamic segmentation, and makes customer data accessible in all marketing tools. As a result, brands will better engage consumers, improve satisfaction, and earn loyalty.
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Sources: Segment The 2017 State of Personalization Report, Bazaar Voice Get Personalization Right or Risk Driving Shoppers Away