How brands are putting personalization at the center of e-commerce

By Rokt
online store

In a highly competitive e-commerce market, brands continue to look for ways to personalize their content to customers in the hopes of establishing a deeper connection. According to a recent Forrester study, while 88% of e-commerce brands believe offering relevant personalization is a high-to-top priority, many customers feel that brands are missing the mark. In order for companies to truly capitalize on this untapped opportunity, brands must create an efficient customer journey that allows for seamless navigation across devices, while also delivering timely, relevant experiences with which consumers are more likely to engage. 

Consumers have been the biggest beneficiaries of the rise in e-commerce, with personalization playing a key role in their purchase decisions. In fact, when polled in the same Forrester study, more than half said they are more likely to spend more with brands that tailor the buyer journey for them and that when brands fail to deliver relevant, personalized experiences, they would be likely to unsubscribe from email lists (56%), switch to a competitor who provides a more personalized experience (36%) and stop shopping at that site (28%).

The question for many brand marketers, however, is what does personalization really mean and how can they customize a consumer’s experience to drive the most impact while still being flexible enough to cater to the entirety of their customer base?

Current personalization efforts leave customers wanting more

Within e-commerce, personalization is rooted in optimizing the customer experience so that brands can provide relevant offers and recommendations for purchases. Brands that have taken the initiative to offer personalized content have primarily done so through web (77%) and email (81%), Forrester reports, but are far less likely to include the main touchpoints that customers use and that drive profitability. And inefficient personalization and irrelevant promotions in these channels can quickly frustrate customers. This inefficiency within the buyer journey can largely be attributed to a lack of data outside of first party data that can be used for personalization. 

Due to a lack of transparency — and the rise of legislative restrictions currently surrounding third-party cookies — many brands must rely on first-party authenticated data when personalizing content. While attributes such as purchase history, names and physical addresses can help brands provide very general recommendations, they do little to truly provide the next best action. Customers are also easily frustrated by a lack of recognition when switching between devices during their interactions with brands, as their data often doesn’t follow the customer over touchpoints. To truly offer personalization with a seamless experience, brands must build persistent identities for their shoppers and offer tailored experiences based on their extensive purchasing history.

Persistent identity can allow for true one-to-one personalization

Persistent identity focuses on the concept that with one “North Star” identifier, companies can build out a profile of the customer across many different touchpoints. However, the identifier has to be sticky, meaning that users will rarely change this identifier when logging into sites over the web. 

The two best customer identifiers when building out a customer’s profile are usually an email address and a phone number. From these two points of identification, marketers can cross-reference log-ins across the majority of sites a customer has visited. Once a customer’s profile has been built out, machine learning tools can then use much larger data sets across a diverse range of sites to further optimize recommendations for the customer at just the right time.

Complying with regulations

Before persistent identity can be successfully implemented, e-commerce brands must make sure they’re in complete compliance with regulations set in place. While 41% of consumers surveyed told Forrester they’d be willing to share their information if it meant more personalized communication, more than 80% of executives surveyed emphasized the importance of solutions that help drive compliance with current and future regulations. 

Among the biggest benefits to persistent identity, however, are the privacy advantages that come with centering on one identifier. As all of the information then comes from sites where a customer has willingly signed up or responded positively to an offer, there is no need for any third-parties to be involved. This creates a closed ecosystem from the beginning, one in which customers are only able to interact with the brands and websites that they choose — no one else would have access to their data. 

The future of e-commerce

In a competitive e-commerce landscape, personalization can only ever be fully realized through the efficient use of consumer data. To do so, many companies are moving towards machine learning and artificial intelligence as a means to effectively put this data to work, ultimately providing better offers and opportunities to consumers. 

By using data science to combine the customer profile with in-the-moment action, machine learning algorithms can take insights and determine the next best actions and experiences for each individual customer. Through this efficient use of data, brands will be able to empower their customers providing personalized offers while maximizing the value of the transaction moment.