Plan, nurture and persuade: three steps to retail personalisation

////// Innovation Technology Insights

Alexandra Frith at Retail Pro International looks at how in today’s ultra-competitive retail environment, retailers can personalise their customer’s experience to achieve e-commerce success.

In today’s ultra-competitive retail environment, those offering a generic, cookie-cutter experience are increasingly being met with disinterest by customers. As Gartner recently noted, businesses have now been thrown onto a customer experience battlefield, with 89 per cent of them stating that customer experience will be their primary basis for competition by this year.

Within retail, customers are tired of trudging through racks of merchandise and endless web pages of products, and want retailers to do the leg work for them by providing interesting items and information from the outset. This means a personalised approach is the only way to breed an atmosphere of familiarity and trust. Early attempts at retail personalisation involved forming lists and providing customers with buying recommendations, but this approach is beginning to look increasingly basic and dated. It’s clear retailers need to look much further than setting up an automatically generated ‘you may also like this’ page to give themselves a good chance of engaging customers.

This time it’s personal

So what form does retail personalisation 2.0 take? It comes as behaviour-based, adaptive personalisation is increasingly coming to the fore. In the past, personalisation could only really be attempted with existing customers, as it relied on drawing insight from a bank of data that had been built up over a period of time.

That’s all changed however, as increasing numbers of retailers are now providing a personalised experience to even the freshest of faces to walk into the store or click onto the website, from studying click-through patterns to having a warm, engaging conversation.

How can retailers get in on the act and make sure they don’t miss out on the party? It can seem difficult to know where to begin, but it can be broken down into three key areas for retailers to focus on:

  1. Lay the foundations
    Without a clear understanding of the value personalisation can bring, a retailer will struggle with internal buy-in and find it difficult to plot a path to success. As such, it’s critical that before getting a drive for personalisation underway, they have a clear idea of exactly what they want to achieve. That will make it easier for them to get hold of the right data and information, and pin-point problem areas that could be improved through an individualised campaign. It sounds like a simple point to start from, but at the moment this step is being skipped by many retailers. According to Aberdeen Group, for example, only 41 per cent of leading retailers analyse site search information, something which could be used to personalise the ecommerce experience. Don’t make the same mistake: lay firm foundations and build a personalised approach from there.

  2. Decide what form personalisation is going to take 
    The second crucial step is deciding what form the personalised customer experience should take; as media philosopher Marshall McLuhan once stated, ‘the medium is the message’. But how should the customer be given a personalised experience or message? Retailers should take care to not come across as creepy: customers could see an in-store advisor approaching them after having identified them through facial recognition technology as extremely overbearing, for example. According to research from MyBuys, customers want a slightly stripped-back approach: 70 per cent would like a recommendation coming direct through the website. It’s a delicate balance, because delivering personalisation in the wrong form could result in a complete waste of efforts, leading to a negative impact on customer relations.

  3. Persuade 
    The final step is putting it into action: Insight must be gleaned and put to use creating a better, personalised customer experience. But how can retailers give the right message to close the sale? One example is identifying potential customer interest in a particular item, then delivering a personalised message or recommendation that can act as the catalyst to push the customer over the line.
    Successful tactics can include offering a discount to those who had abandoned shopping baskets, or providing free shipping if the purchase is completed within a short timeframe.

It might seem like you’re making great time if a step in the process is skipped, but doing so will ultimately cause the downfall of a personalisation project. The message is simple: by following these three steps, retailers will be able to take stock of what they have and what they want to achieve, decide how it will happen and follow through to deliver the goods of a great personalised customer experience. (by Alexandra Frith, Customer Experience at Retail Pro Internation, in Netimperative)