Personalized shopping experiences have become essential for eCommerce businesses to boost customer engagement, increase sales, and strengthen consumer retention. eCommerce personalization uses data and insights to tailor a customer’s shopping journey to their specific needs, preferences, and behavior.

By leveraging first-party data and other sources of information, eCommerce businesses can gain a better understanding of their customers, anticipate their needs, and deliver targeted messaging and personalized product recommendations.

It’s difficult but not impossible to achieve the level of customer service and engagement found in brick-and-mortar shops in an eCommerce store. Although the merchandising, sales staff, decor, and overall atmosphere of in-store shopping have a unique impact on shoppers, you can create a customized and thoughtful eCommerce experience with a few tips and tools.

In this article, we’ll explore the power of eCommerce personalization and how businesses can craft customized shopping experiences for their customers. We also look at best practices, examples of businesses that have successfully implemented personalization strategies, and how to avoid common pitfalls.

eCommerce personalization

In eCommerce, personalization refers to a shopping experience tailored to your customers based on their past engagements with your website. For example, your brand could display dynamic content grounded in buyer data like demographics, intent, preferences, browsing history, previous purchases, and device usage (e.g., whether the customer is shopping using mobile, a tablet, or a smartwatch).

Data collection is the foundation of personalization. Several pieces of information are critical here, including:

• Traffic
• On-site interactions
• Email
• Personal data
• Paid media pixels
• Purchases
• Search
• Pricing

By tracking these data points, you’re able to make informed decisions based on reliable evidence. You can then implement the insights gained from that information into your personalization efforts, such as what the financial threshold is for customers or what kinds of content are most likely to engage and convert them.

To be successful in your eCommerce personalization efforts, you must determine:

• What data you’re tracking
• Who you’re monitoring
• When you collect that data (which should be in real time)
• How you track (including tools used)

Avoid generalizing and making assumptions about your shoppers; not all traffic is the same, and individual intentions can vary enormously.

Why eCommerce personalization is important

Giving your customers tailored experiences distinguishes your brand, improves your shopper experience, and can boost your CTAs and upsells. A report from McKinsey & Company found that “companies that excel at personalization generate 40 percent more revenue from those activities than average players.” It’s proven to help you stand out from the competition, which leads to larger benefits.

eCommerce personalization also ensures the content displayed to your buyers is relevant to them. This is important, since 80% of shoppers are likely to buy when a brand provides personalized experiences (according to Zendesk, that number is over 90%). The opposite holds true as well: When brands fail to deliver a personalized experience, customers are more likely to seek out a competitor who will.

Increase sales

An impressive 86% of consumers say eCommerce personalization influences their behavior, and 74% of marketers assert it increased their sales.

When you show shoppers relevant content, they’re more likely to engage with it and, eventually, complete a purchase. You can accomplish this by leveraging tools and widgets that allow you to:

• Display recommended products for upsell, cross-sell, or even down-sell opportunities
• Show visitors products “Based on your browsing history”
• Customize floating headers or other offers based on visitor behavior, geography, and more
• Tailor emails to products the customer has bought to avoid marketing the same products and instead offer cross- and upsells after a primary purchase.

No example of personalization is more famous than Amazon’s similar recommended products, which highlights items based on data from the platform. That recommendation algorithm is so powerful, some experts suggest it drives 35% of sales on Amazon.

Build brand loyalty

More than 70% of consumers expect eCommerce personalization from the brands and businesses they choose, which means your brand loyalty is at risk when you forgo tailoring your customers’ experiences.

As digital behaviors expand, so do consumer expectations, especially when major eCommerce leaders raise the bar for other companies. Brand loyalty increases when consumers see businesses have made an effort to get to know their shoppers and demonstrate how well they know them. This can take the form of displaying relevant ads, offering targeted promotions, celebrating milestones like birthdays, and setting triggers based on behaviors.

Boost customer engagement

As previously stated, shoppers are more likely to engage with content that’s relevant to them, so, the more personalized it is to your customers, the higher your engagement rates will be. This creates a cycle where buyers increasingly engage with your content, making it easier for you to personalize it to boost engagement, etc.

You can derive valuable information from every interaction to deepen your knowledge of your customers. In turn, you can use that to craft more targeted marketing initiatives that will close more sales.

How to create an eCommerce personalization experience for customers

An eCommerce personalization experience begins with personalized marketing, where you study your existing consumer data and collect actionable insights to steer your efforts. With the number of CPCs and discerning shoppers continuing to rise, personalization matters now more than ever.

McKinsey & Company found that “consumers don’t just want personalization, they demand it,” so it’s critical to make this an integral part of your business model. Once you become familiar with your consumers, you can employ strategies to produce unique shopping experiences for them.

Tailor product recommendations

Product recommendations are a primary channel for personalization. Analyzing buyer behaviors and preferences lets you provide relevant recommendations for items and services that are most likely to interest them.

You can review information such as past purchase history, browsing behavior, and wish lists to tailor these recommendations. Display them on your website or app, in marketing emails, or through other channels for maximum reach. Amazon’s strategy of sharing products that other customers have purchased at the same time has also proven effective.

Customize the shopping experience

In addition to product recommendations, you can customize your overall shopping experience: Tailor the layout and design of your website or app to buyer preferences, provide individualized product search results, and offer custom pricing or promotions. Adding these unique elements creates a more seamless and convenient experience for shoppers.

Craft individualized marketing messages

Unique marketing messages better engage customers. Capitalize on your consumer data to deliver targeted messaging that resonates deeply with each shopper. These messages can include targeted email campaigns, social media ads, and other types of focused advertising.

Use chatbots and virtual assistants

Chatbots and virtual assistants can also produce a more personal shopping experience. The former are great for offering personalized product recommendations and answering customer questions, while the latter can provide unique shopping assistance and suggestions. Additionally, you can automate these tools to ensure tailored customer service, which improves customer satisfaction and loyalty.

Understand your customers

To create eCommerce personalization, you must first study your customers in depth. That entails collecting information about their behavior, preferences, and needs:

• The importance of first-party data: First-party data is information collected directly from your customers either through their interactions with your website or app or through surveys and other direct communications. It provides a clear view into your buyers’ behaviors and preferences, revealing what products and services they’re interested in, what types of marketing messages resonate with them, and the kinds of shopping experiences they prefer.

You can also use first-party data in your marketing, even in geographic regions where third-party data is not allowed (e.g., much of the EU).

• Other ways to gather customer information: Surveys, polls, and direct feedback are common ways to collect information from customers. However, you can also track their behavior on your website or app, such as which pages they visit, how long they spend on each page, and what products they view or purchase. Social media platforms are another great source of information, as shoppers often share their interests and opinions through these portals.

Consider AI as well for tracking which items people buy together, which colors or product types people group together, etc., to help you streamline your personalization process.

• Analyze customer behavior: Analyze your collected data to identify patterns and trends. You’ll learn what products and services are most popular, what marketing messages are most effective, and what types of shopping experiences customers like. This helps you determine where to apply personalization for the best results.

You can do this manually. However, analytics and AI programs can greatly simplify the process if you have enough traffic to warrant the investment.

Build customer personas

Customer personas are fictional representations of your ideal buyers based on the data and insights you’ve gathered. They help pinpoint the needs, preferences, and common behaviors of your target audience so you can tailor your marketing messages and shopping experiences accordingly. Update these personas regularly as shopper preferences and behaviors change.

Communicate clearly

One of the simplest solutions to provide a personalized experience for your customers is through maintaining open, two-way communication. Strive to communicate your brand value proposition and product information to your customers, as well as listen to their feedback and capture valuable data. Use form submissions, polls, and personalized opt-ins to gather this information and get to know your buyers. This will help you understand their interests and needs on a deeper level and improve future communications.

Also, read and respond to reviews and act on negative feedback. You can adopt tools to monitor consumer opinions, but in general, treat feedback as your most credible source of customer satisfaction and needs. At the same time, you’ll want to establish lines of communication to talk to consumers so they feel they can talk to you about their experiences, both positive and negative, and find a solution before feeling the need to leave a poor review.

Retarget

Retargeting, or remarketing, is the practice of showing customers ads based on prior interactions they’ve had with your business’s digital presence. This can range from engaging with social media content to browsing product pages or even adding items to cart. When you retarget, you show customers content they’ve previously engaged with or that’s similar in nature, which produces a cohesive, personalized shopping experience.

Increasingly though, you can only implement this tactic with your own data, as most web browsers no longer use retargeting cookies. Therefore, you’ll have to target consumers based on your first-person data, either by advertising from your website, recommending products from your site, or with email. For example, shopping cart abandonment emails and product reminder emails are great ways to employ retargeting.

Say thank you

Post-purchase communications are a prime opportunity to add a personal touch. Rather than sending a generic appreciation message, thank your customer by name and include the product they purchased as well as any order updates you can provide in the message.

Display content that’ll help them gain the most from their purchase, such as a useful hint or demo video link. In addition, if your product requires accessories, refills, or uses another product, consider offering a subscription for those consumables in your post-purchase communication. “Set it and forget it” refills translate to convenience for the customer and increased revenue for you.

Tailor messaging to customer activities/purchase habits

If you don’t offer subscriptions or auto-renewals, you can still send tailored messaging based on your buyers’ previous purchase habits. The makeup company Clinique does this well: They send reminder emails to customers letting them know it may be time to replenish their products.

You can deliver unique messaging at multiple touch points, such as reminding customers they’ve left something in their cart or showing retargeting ads based on past browsing history. Whatever you choose, that message should reflect each shopper’s activities and interests.

Create offers based on customer actions

Custom offers based on buyer actions are one of the best examples of personalization in eCommerce. For instance, when a customer purchases a particular product, you can send them offers for complementary items that may help them maximize their original purchase. Or, if a shopper has left an item in their cart, that could trigger a special deal to close that sale, such as 10% off, free shipping, or a free gift with purchase.

Display location-based products and campaigns

If a customer lives in the desert, they probably don’t want to see ads for snow boots. Location-based campaign targeting shows shoppers content that’s more relevant and of interest to them so they’re more likely to engage with it.

To display products or campaigns based on location, you have to collect demographic data from your customers. These targeted campaigns or displays can vary from product-specific (e.g., showing snow boots to people who live in places where snow is common) to area-specific, like showing state- or city-themed items.

Upsell, cross-sell, and downsell

Upsell, cross-sell, and downsell opportunities are relatively easy ways to personalize the shopping experience for consumers.

When a customer has engaged with a particular product or added it to their cart, you can showcase other items through the widgets on your site. These can include:

• Cross-selling opportunities, such as showing products that complement the item(s) your buyer is considering
• Upselling opportunities, like displaying a larger or newer (and usually more expensive) version of the item(s) the shopper has engaged with
• Downselling opportunities, which include showing customers a smaller, less advanced, and usually less expensive version(s) of a product or products the customer is looking at (usually if you notice they’re about to exit)

These actions help shoppers find the product best-suited to their needs, providing excellent customer service and increasing the likelihood they’ll complete checkout.

Streamline site navigation

When visitors arrive on your website, they don’t want to spend time clicking from page to page to find what they’re looking for. Instead, use your navigation to personalize the experience for new and repeat customers by helping them reach relevant content swiftly. This saves them time and boosts your conversion rates.

For example, you might ask a first-time visitor to your online store to select the type of product they want and direct them accordingly. When a shopper returns to your website, you could display a banner that’s based on their previous browsing history to help them search.

Personalize opt-ins

Just like online traffic, not all consumer preferences are the same, so it’s imperative you personalize opt-ins for your buyers to ensure they receive the content they want and avoid what they don’t.

Allow customers to select their preferences when signing up for newsletters and other communications. These could include options like:

• Helpful hints
• New product releases
• Deals and promotions
• General business news
• Frequency of communications

Best practices for eCommerce personalization

Because personalization is crucial for eCommerce businesses, you must follow eCommerce personalization best practices to ensure you employ it effectively for a positive reception from your consumer base.

Transparency and privacy

A key consideration of personalization is transparency and privacy. Customers want to feel confident that companies use their information responsibly. Be clear about what data you collect and how you’ll use it. Also, comply with data privacy regulations such as GDPR and CCPA.

Avoid going overboard

While personalization is effective, you shouldn’t overdo it. This can lead to heavy reliance on customer data or making assumptions about their preferences that are inaccurate. Over-personalization can be off-putting to shoppers and make them feel like their privacy is being violated. Be sure to maintain respectful boundaries when customizing the buyer experience.

Test and measure your efforts

To verify your personalization efforts pay off, monitor their impact. Use A/B testing to compare personalized and non-personalized experiences, and track metrics such as conversion rates and customer satisfaction. This will help you identify what works and what you can improve.

Adapt to changing consumer preferences

Consumer behaviors change over time, so it’s important to review and update your personalization strategies regularly. Keep track of alterations in buyer preferences and adjust your tactics to accommodate them. This may involve updating customer personas, refining product recommendations, or adapting marketing messages.

eCommerce personalization in action

To fully grasp the concept of eCommerce personalization, let’s examine some real-world examples of businesses that have successfully implemented its strategies.

Stitch Fix

Stitch Fix is an online personal styling service that uses customer data to offer personalized product recommendations and customized styling advice.

They crafted their customer personas based on buyers’ purchase history and browsing behavior, then used those schemas to display individualized product recommendations and tailored marketing messages. Stitch Fix also introduced a chatbot to provide personalized shopping assistance and answer shopper questions. Employing these strategies earned them a significant increase in customer engagement and sales.

Sephora

Beauty brand Sephora also leverages customer data to push targeted product recommendations and marketing messages. They’ve even adopted augmented reality technology to allow customers to try on makeup virtually. These actions enabled Sephora to produce a memorable shopping experience, which resulted in greater consumer loyalty.

Wayfair

Similar to Sephora’s AI implementation, online home goods retailer Wayfair lets customers build virtual rooms and experiment with different furniture and decor options for a more personalized shopping experience. They also employed chatbots to give shoppers individualized assistance and answer their questions. All their efforts helped nurture the company’s massive base of loyal followers.

Helpful tools

In the early days of your business venture, you may be able to stay on top of eCommerce personalization efforts manually, but as you scale and grow, you’ll likely need to automate them. Thankfully, there are dozens of tools available to support personalization efforts, from data collection to enabling website edits quickly and easily. We’ve listed a few recommendations below to get you started.

OptinMonster

OptinMonster is a popular lead generation software that marketing agencies, eCommerce websites, and small businesses use to help grow their subscriber lists and build their brands.

The software’s value lies in its behavior automation capabilities, which help eCommerce professionals unlock major revenue by reducing cart abandonment rates and improving conversions. That automation allows the platform to glean information from your customers and grow your subscriber lists so you can focus on other aspects of your business.

OptinMonster offers both a WordPress plugin and a Shopify app (among other options) for a seamless add-on to your online store. With this platform, you can create:

• Personalized exit-intent pop-ups to help you recover lost revenue from abandoned shopping carts
• Floating headers to promote flash sales and deals with countdown banners (which are personalized to each visitor)
• Coupons and other lead magnet offers based on visitor behavior to help you convert hesitant shoppers into email subscribers for future marketing opportunities

WPForms

WPForms is a form builder for WordPress that boasts the easy creation of payment forms, contact forms, registration forms, and more for your website. It also offers a powerful personalization feature you can use to boost sales by:

• Building surveys or polls to learn more about customers for improved targeting
• Sending personalized thank you emails to every visitor who submits a form on your website
• Collecting and storing geolocation data along with form submissions so you can better segment email lists and craft location-based offers

Of course, being a WordPress form builder, WPForms is only applicable to websites hosted on WordPress.

Barilliance

If your goal is to produce a personalized experience throughout the entire customer journey, then Barilliance is for you. Its AI-driven product recommendations tailors and then automates cross-sell and upsell opportunities across all consumer touch points. Meanwhile, its website customization gives your visitors targeted, real-time messages and offers to increase sales.

Barilliance also includes cart abandonment and customer retention tools, live shopping notifications, and more.

Salesforce B2B Commerce

Salesforce’s B2B Commerce solution uses their Einstein AI software to help online retailers tailor product recommendations for all web visitors. The solution provides unified data to personalize each interaction, unify touch points, and grow revenue across channels. This enables you to convert more customers and boost loyalty as you provide a seamless customer journey from beginning to end.

Bunting

Bunting allows you to produce personalized website content for each visitor. It offers solutions based on your selected pain point or primary focus: Acquire Traffic, Convert Visitors, or Retain Customers.

Specifically, you should look at Personalize, which is an AI-powered solution that earns more sales by customizing the visitor experience through product recommendations, website personalization, urgency and social proof, and cart abandonment reduction tools.

Wrapping up — Upgrade your buyer experience through eCommerce personalization

By adding personal touches throughout the buyer journey, you transform their experience from a basic transaction to an ongoing relationship. These connections deepen loyalty, increase customer lifetime value, and leave shoppers with a great impression of your brand, which they may then share with their friends and family and on social media.

By leveraging first-party data and other sources of consumer information, you’ll uncover valuable insights into your customers, anticipate their needs, and deliver targeted messaging and personalized product recommendations — all of which contribute to a higher conversion rate. For maximum results, be transparent about your data usage, test and measure the effectiveness of your efforts, and adapt to changing consumer preferences. Follow the advice and examples included in this article, and you’ll see greater sales and improved customer satisfaction, as well as gain a competitive edge in the eCommerce industry.

Published: June 21, 2022
Updated: July 4, 2024