December 29, 2023

The 4 Benefits of Personalization in eCommerce That Help Boost Sales


The 4 Benefits of Personalization in eCommerce That Help Boost Sales   

Imagine walking into a store where every product is exactly what you’ve been looking for, and all the recommendations are tailored to your interests. How convenient would that be? 

This is the kind of experience business owners create when they personalize their online store.

Personalization is utilizing customer data to create a unique shopping experience tailored to each customer. This technique has gained significant recognition because it can help boost sales. A study said that brands that personalize earn up to 40% more than its counterparts that don’t. 

Providing eCommerce personalized experiences is not just a nice-to-have in this highly competitive industry; it is a must-have. With the myriad of options available to consumers, you need to offer unique experiences to your customers to retain their loyalty.

This post will discuss the four specific key benefits of personalization in eCommerce that can lead to an increase in sales.

1. Enhanced customer experience

Here’s one of the benefits of personalization in eCommerce that can boost sales: It can greatly enhance the online shopping experience by making it seamless, efficient, and enjoyable. When a visitor has a great experience on your site, you increase the chances of that customer buying from you.

Through data analysis, you can ensure personalized product recommendations. 

Butterfly Twist, for instance, uses the IP address to determine the sizing convention (whether American, European, Japanese, etc…) to show to the individual customer. This helps customers save time, since they don’t have to convert a shoe size measurement into a value they understand.

As part of personalization in eCommerce, some companies also offer flexible delivery options based on a potential customers’ time zone and location. Here's an example of a customized popup displaying shipping offers based on the customer's geolocation. 

This is another way you can improve customer engagement and experience. Think about it. Would you explore an eCommerce page if it shows it doesn’t deliver products to your country? You’d probably just leave the site and go to another eCommerce business that shows what you’re looking for.

You can enhance the customer experience through personalization in other ways. For instance, why not personalize your eCommerce site’s language based on a visitor’s IP address. How about tailoring your product page layout according to your audience’s preferences. For instance, why not showcase as the main pictures on your homepage the most popular products in your audience’s area?

2. Increased conversion rates

Personalization in eCommerce also leads to increased conversion rates. 

With personalization, after all, eCommerce retailers can target customers with the right product. 

Personalization in eCommerce also enables businesses to establish different price points for different customers. For this, eCommerce businesses may analyze a user's purchase history, location, and device use to determine their willingness to pay. 

For instance, a frequent shopper might receive discounts to foster loyalty, while a visitor from a high-income region might see higher prices. This personalized dynamic pricing helps increase conversion rates since website visitors are shown prices that they can afford.

Personalization can help increase conversion rates in other ways. For instance:

  • With personalized offers and incentives, you can reduce instances of abandoned shopping carts
  • With personalized content, you can help shoppers find the products they're looking for more quickly and easily
  • Through tailored recommendations, you can encourage upselling and cross-selling. We’ll talk more about these later.

Complement personalization with strategies to enhance impulse buying and you can expect the best results. So, you can create urgency by specifying your stock of your audience’s preferred product is limited, for instance. Or, you can include a countdown timer in your page to emphasize that a personalized discount is valid for a limited time only.

3. Higher average order value

As I mentioned earlier, personalization in eCommerce can boost conversion rates. One of the ways it can do this is by increasing the higher average order value (AOV). 

eCommerce average order value (AOV) refers to the average amount a customer spends on your online store during a single transaction. It's calculated by dividing the total revenue by the number of orders. 

By bundling related products together, offering volume-based discounts, and promoting add-on products that complement existing purchases as part of personalization, customers are more likely to purchase additional items or choose higher-tiered options. 

This retailer, for example, used customer data to give a discount on previously seen goods, encouraging buyers to add more things to their carts.

You can increase your higher average order value by sending out emails with the tailored product recommendations. 

Just make sure, of course, that your email campaign is personalized as well. So, include your potential customer’s first name in the email if you can. Also, use a language tone that is likely to resonate with specific segments of your mailing list. If you don’t have the time to write, AI templates can expedite the content creation process for you.

Another option is to run targeted ads on social media based on a potential buyer’s behavior on your site. So, if a buyer recently purchased a laptop on your site, for instance, your social media ads could showcase laptop accessories like a keyboard and a laptop cover. With this type of personalized content, you can also gain Facebook and Instagram followers, assuming your customer hasn’t followed you yet, and comments and likes.  

4. Competitive Advantage 

Overall, in the context of eCommerce, personalization gives businesses a competitive advantage. Because of the benefits of eCommerce personalization mentioned above, you can set your online store apart from your competitors. 

Ultimately, embracing personalization allows you to:

  • Create memorable shopping experiences that keep customers coming back
  • Tap into loyal customer networks through word-of-mouth and referrals
  • Leverage customer data to make informed business decisions

Besides, not all eCommerce stores invest in customization. In fact, 21% of eCommerce businesses have noted that this was not a priority at the moment.

That means if you invest in personalization, you’ll be one of the few eCommerce stores that do so. In the minds of potential customers, then, you’re unique. Apart from your excellent products and services and affordable prices, personalization can be your unique selling proposition that will keep those customers coming.

In closing

It's no secret that personalization has become a powerful driving force behind successful eCommerce businesses. Businesses like Amazon have made personalization strategies and tailored experiences the foundation of their success.

Ultimately, e-commerce companies that use customization technologies benefit from improved customer satisfaction, conversion rates, and higher average order values. All these result in a competitive advantage that sets the business apart from the others. 

In other words, given consumer expectations for a tailored shopping experience, the benefits of personalization in eCommerce are endless. Don’t miss out.

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