Common E-Commerce Personalization Pitfalls to Avoid

by Casey Botticello | Apr 14, 2022 | Community Experience, Guest Post

Common E-Commerce Personalization Pitfalls to Avoid

Written by Casey Botticello

April 14, 2022

It’s 2022, and businesses are swiftly shifting towards personalization in their e-commerce strategies. The pandemic-induced lockdowns in the past two years have shaken business profit foundations to their cores, and a virtually-guided business venture is the only way out of this hell-loop. This includes avid use of e-commerce personalization strategies to maximize profit margins and receive higher ROIs.

A state-of-art directory towards establishing personalization in e-commerce is surfacing across online businesses. Online marketers have observed a 20% increase in sales by using personalization as a priority strategy while selling their products.

Additionally, 80% of consumers are more likely to return to the website that offers them personalized services. Typical consumer behavior suggests that they visit a particular website in hopes of locating their ideal product. So, when this product is customized to their exact choices, they will keep coming back for more.

However, 63% of digital marketing businesses lack the correct technology and tools to personalize services. So, even though your business may have the tools and expertise, it is natural to fall into some common pitfalls while undertaking personalization. These mistakes may occur in the initial phase where you’re trying to figure it all out or may even occur at a later stage in the business growth.

Implicit vs. Explicit Intent in Personalization

A curious point of interference by businesses, while they are undertaking e-commerce personalization strategies, is to conduct the exercises through an implicit and explicit intent.

Implicit Intent in Personalization

An intent to understand your consumers occurs implicitly while trying to understand their behavioral patterns when they are navigating your website.

A few standard blueprints to understanding consumer behavior implicitly is through tweaked page layouts in sync with consumer preferences, notifications, and specific discounts offered on the website, which pop up on the screen as they are about to leave the page. Besides this, the system of recommendations can also be used to offer similar products to the ones they were navigating.

The Issue with Using Implicit Intent in Personalization

When there is a concrete objective set of rules to guide you through a process, there is little left scope left for creativity, and the possibility of searching out new developments in a project is bleak.

The same is the case with using implicit intent in personalization. Using a monotonous set of guidelines to judge the consumer’s behavior restricts it to a singular viewpoint.

84% of consumers prefer being observed as humans and not numbers, so by exercising this restrictive viewpoint, businesses overlook the potential of unlocking new and note-worthy elements that they could target.

Explicit Intent in Personalization: Success Story

The Search Bar. This is an imperative tool on your website that empowers consumers to dictate their desired searches, proving to be an important data collection unit for businesses.

By granting them the choice of spelling out their wants, businesses can then navigate their choices, pair it with the implicit intent, and build the hallmark personalized audit for their consumers.

Businesses should then focus on striking a balance between what consumers desire and what the company wishes to advertise. This is the secret to effective personalization.

Common Pitfalls to Avoid in E-Commerce Personalization

5.Personalization in all its glory is a dead nail if you use it incorrectly or are continuously experiencing unintentional pitfalls. Here are some common mistakes businesses make while undertaking the strategy of personalization and how you can fix them:

1. Less Personalization

Your personalization scheme will not make the cut if you have a one-goal strategy in mind. Something like, “I want to personalize the products for my potential customers.” This can be a wide-based strategy for any and every business out there.

What makes a difference is if you garner a specific plan central to your personal business goal that ventures from the beginning of navigation till the end product is purchased.

The Fix- Glood.AI can help you locate the friction points on your websites that consumers always end up navigating to at regular intervals. Use these points as milestones to curate your much larger and more intricate strategy. Utilize the elements of acquisition, merchandising, communication, and promotions to mobilize a clearer idea.

2. Personalization without the Correct Tools

An inherent “herd mentality” plays at the back of most entrepreneurs’ minds when they discover a newly evolving strategy. For example, personalization is the new talk of the town. So naturally, businesses will mindlessly invest in all the e-commerce personalization tools, only to discover that most of them don’t fulfill their purpose.

A lack of the correct tools generally leads to higher costs and a stagnant ROI.

The Fix- Understand your specific industry, its generic and specific requirements, as well as the consumers you cater to. Platforms such as Glood.AI are equipped to help you understand your business requirements and accordingly help you choose the right personalization tools, thereby minimizing the loss factor.

3. Personalization on a Single Channel

Statistics show that 73% of consumers use multiple platforms to cater to their daily online shopping needs. So if you’re focusing on the personalization constricted to only one website, chances are bleak for your businesses to take off on an unprecedented scale.

The Fix- Acknowledge the multiple avenues in which your business can carry out personalization activities and be informed of how you can exercise an omnichannel personalization strategy.

4. Not Taking Advantage of Real-Time Data

Some online businesses make the grave mistake of relying on historical or cold data on their websites to determine personalization strategies. This information will not prove vital if your customer has already satiated their need with the product.

The Fix- The idea is to find a website partner that provides your company with Big Data architecture to venture on to have a more intricate personalization goal. Glood.AI is your one-stop solution to attain all the real-time data your consumers navigate on your website.

5. Personalization Without Testing

Standard personalization tools and methods may be beneficial to some businesses, while to others, they may not stand the test of time. The goals, consumer behavior, and strategies are unique to each business, and no brand should focus on optimizing a standard tool that has worked for two others.

A hypothesis to an effective strategy is not enough to reap its benefits.

The Fix- Instead, an A/B format of testing should be applied to finalize the tool relevant to your business and the market it caters to.

6. Using Personalization as an Add-on Necessity

Most businesses use personalization as an add-on to their central business strategy. However, when used correctly, it can positively transform business gains, and with the right tools, your business can earn unprecedented profits and higher ROIs.

The Fix- Using personalization as a central strategy to enhance your consumer experience will heighten your business traffic. Glood.AI helps you create an omnipresent channel strategy that targets an all-rounded approach towards e-commerce personalization.

7. Skipping Micro Targets during Personalization

In the chaos of sticking to a consumer **personalization** strategy, some imperative micro targets are left out. For example, if a consumer on your website is purchasing a mobile phone, it’s only inevitable that they will branch out to another website that sells mobile cases for the same model. If you cut out that extra time by suggesting them a mobile case from the same phone model, chances are, consumers will purchase both.

The Fix- Glood.AI is a commerce experience platform that can be your best friend when it comes to identifying the potential pairings to a product bought on your website.

8. Personalization Stagnation

Initial progress through a successful personalization strategy set-up is great. Consistency and constant evolution take it from great to fabulous. However, most startups give up on their strategies after some initial success.

The Fix- Your business needs an all-encompassing strategic analysis tool that will keep your head in the game and constantly provide you with potential milestones and evolution in the navigation activities taking place on your website.

9. Blind Faith in AI

While AI is the future of essential personalization, it makes extremely calculative decisions, and all the results it curates for your website to follow are purely based on data judgment. Following the earlier agreement to treat customers like humans and not data books, having blind faith in AI will not cut it for you.

The Fix- Creating manual strategies, custom content, and self-drawn imagery provide more dimension to understanding personalization on a deeper level.

A Blueprint to Personalization Implementation

Glood.AI is a leading commerce experience platform that will take your personalization level to another dimension. Using personalized suggestions online as well as specified marketing strategies, they keep strict tabs on your on-site consumer behavior and trends and finally choose the correct brands and tools for you to optimize your personalization goals.

All in all, they are your ideal personalization catalyst as they sift out the best ingredients for effective strategies that your brand can follow and also pick up on real-time data to provide you with a thorough path to walk through.

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How To Identify High Value eCommerce Customers

by Juhil Mendpara | Nov 29, 2021 | eCommerce, Guest Post

How to Identify High Value eCommerce Customers

Written by Juhil Mendpara

November 29, 2021

In business, the quality of your customers is equally important as the quantity.

The best customers purchase frequently, have a high average order value (AOV), and are typically low-maintenance. On the other side of the spectrum are the high-maintenance customers who return orders, spread negative word-of-mouth, and are typically not worth the effort.

Overall, a sort of Pareto principle applies here: The top 20% of the customers drive 80% of the business. This Spyder case study is proof of that: 81% of Spyder’s revenue comes from 20% of customers.

Now, imagine 100% of your customers are like the top 20%. Mathematically, that’d mean 4x the business!

However, realistically, it’s impossible to have 100% quality customers.

With some effort, though, you can increase the number of high-value customers. And it starts with identifying your best customers.

4 Ways to Identify Your Best Customers

To identify your best customers, look for customers with these characteristics:

1. Active in your community

First, build an online community if you don’t have one. The benefits of providing your (potential) customers with a platform to talk with each other are unreal (The overall average ROI for advanced communities is 70x!).

Of the many benefits of online communities, one is you can identify your best customers.

Statistically, 7% of members in online communities perform actions and answers, 25% provide validation, and 11% share. All these active community members are generally your top customers ⁠— they are loyal to your brand and have good things to say about your products and services.

2. Share positive opinions on social media

Those who share positive word-of-mouth about your brand on social media are among your best customers. They like your product or service enough to share about you, tag you, retweet your tweets, comment on your posts, respond to your polls, emoji-reply to your stories, etc.

For example, Jackson (thanks, Jackson!) tweeted praising Social Snowball as a must-have Shopify app:

3. Promoters on NPS Surveys

Only a fraction of your best customers share about/interact with your brand on social media. Most of them are silent purchasers who do promote your products but in private DMs or during conversations with friends and family.

To identify such silent promoters, you can run NPS surveys. NPS (Net Promoter Score) is a gold standard for evaluating customers’ loyalty towards a brand and their likeliness to promote your product to a potential customer.

Here’s how it works: All customers are sent a question like this:

How likely are you to recommend [Product or Service] to a friend or colleague?

Those who select 9 or 10 are identified as “Promoters.” And these promoters are typically your low-maintenance, high-loyalty customers.

4. Purchase frequency is high

If you sell frequently-needed items (like clothes, food, etc.) and a customer buys them from you frequently, it’s a direct indicator of an ideal customer.

On the other hand, if you sell something (like watches) that won’t attract high purchase frequency, you can still accurately guess the best customers. For that, you’ll need to look at LTV (Lifetime Value). If a customer has purchased products worth more than the average LTV, the customer is most likely on the “best customer” side.

Identified Your Best Customers? Here’s What To Do Next:

There are two primary reasons to identify the best customers:

To keep them with you forever. After all, they bring in the majority of your business revenue. Plus, increasing customer retention rates by 5% boosts profits by 25% to 95%.
To leverage your bond to attract new customers. The best customers are already your brand ambassadors; however, you can proactively ask for more and get more from them.

Here are the things you can do to achieve both goals:

1. Invite them to join your affiliate/referral program

Firstly, and obviously, create an affiliate program for your business if you don’t have one.

An affiliate or a referral program incentivizes customers or influencers to bring customers to your brand. Here’s how it works: Each affiliate or referrer is given a trackable link/coupon code, which they can share with potential customers. Then, when the potential customer buys through that link or coupon, the affiliate (typically) gets a % of the sale as a commission.

Paypal’s referral program is a good example. Paypal paid its customers $10 for referring a friend and exponentially grew to over 100 million users in two years:

By paying your best customers to bring more customers, you motivate them to spread positive word-of-mouth even further.

And these new customers your best customers bring will be on the “best customers” side of the spectrum ⁠— the kind that you want more. These statistics are proof:

Referred customers bring a 25% higher profit margin.
A referred customer is 18% more loyal than a customer acquired through other channels.
Customers referred by other customers have a 37% higher customer retention rate.

2. Ask them to leave reviews

I know of no one who doesn’t read reviews before making a purchase online. Reviews are the lifeblood of online businesses. And the more positive ones you have, the better the conversion rate will be.

Once you have identified your best customers, make extra efforts to get reviews from them. Go beyond just the product reviews that you ask from everyone; ask your best customers to leave reviews on Google My Business, Facebook, etc., too.

They’ll likely have nice things to say about you.

3. Ask them for UGC

UGC or User-Generated Content is any type of content ⁠— videos, images, text ⁠— actual users share about the product they received or experience they had.

79% of people say UGC highly impacts their purchasing decisions. Meaning, if you sprinkle some UGC at crucial points of the customer buying journey, it’ll increase the conversion rate.

Here are a few ways to gather quality UGC from your best customers:

Send emails to your top customers and offer them a reward to post their experience with your product on Instagram. Then, reshare it on your profile so potential customers can see it.
Run a contest on social media to encourage fans to create something and tag you.
Ask your favorite customers for video testimonials.

4. Upsell and cross-sell

In the book Marketing Metrics, the author shares an interesting statistic: The probability of selling to a new prospect is 5-20%. The probability of selling to an existing customer is 60-70%.

Because your best customers already know your brand and trust your products, they are most likely to buy from you. Therefore, sell more to them instead of looking to acquire more customers (of course, that’s only if you had to choose from one). This way, you’ll increase your revenue from just the low-maintenance customers.

Here are a few things you can do:

Give them loyalty points that they can use in-store.
Recommend them products based on their purchase history.
Create a membership/VIP club and invite your top customers, so they purchase from you every month or quarter.

All in All

You can identify your best customers by:

Noticing active community members,
Running NPS surveys,
Analyzing their shopping patterns,
Or seeing their social media interaction with or mentioning your brand.

Once identified, ask them to:

Become an affiliate and promote your brand,
Rate your products and brand all over the internet,
Share their version of product photos, use cases, etc.,
And buy more.