Announcing the 2020 Annual Reflektion eCommerce Personalization Report
Online shoppers have been filling their carts with increasing gusto every year, and 2020 brought a surge in eCommerce, also known as electronic commerce, digital commerce, or internet commerce, refers to the buying and selling o... More that few could have predicted. The coronavirus pandemic has underscored the sheer range of products consumers can buy anywhere, at any hour of the day, and from any device. For online businesses, competition is fierce on many levels, and there is constant pressure to go the extra mile to keep their customers’ limited attention. The mantra online retailers are adopting as we shift into a “new normal” is this: More than ever, consumers aren’t just buying products. They are buying experiences.
Leading eCommerce retailers are leveraging next-gen Artificial intelligence (AI) is the simulation of human intelligence processes by machines, typically computer systems. ... More to drive their customer engagement to new heights, creating seamless journeys for their customers that are quick, easy, and highly personalized across all the channels they use. By doing so, they have raised the bar considerably, which means that for those businesses that have yet to adopt real-time, omnichannel, In the eCommerce context, one-to-one or 1:1 personalization refers to the practice of delivering a unique, hyper-targete... More AI, there is a growing sense of urgency.
For that reason, Reflektion has partnered with WBR Insights, a leading retail market research firm, to conduct an in-depth survey into eCommerce personalization. The result was the 2020 Reflektion eCommerce Personalization -- in the eCommerce context -- refers to the practice of creating personal interactions and experiences ... More Report, which takes a deep dive into the key challenges and trends occurring in the market.
About the Markets and Professionals Represented
The 165 people who responded to the survey conducted are on the digital commerce technology front lines. The vast majority held senior positions as eCommerce and marketing professionals at IR500 companies: 72% at the manager/director level, 20% at the vice-president or senior-vice-president level, 5% as individual contributors, and 3% C-suite executives. Typically, these were professionals whose companies either had already implemented personalization technology, were planning to implement such technology, or were considering a material investment in it.
The participants represented all the major sub-segments of the retail industry, with the top three being from the categories of apparel & accessories, home & garden, and health and beauty. Among the other sub-segments represented were entertainment products, footwear, sporting goods, and more.
6 Takeaways from the 2020 Annual eCommerce Personalization Report
A full 98% of respondents (an even larger number than reported last year) agreed that eCommerce personalization is important for driving engagement among customers. Of that 98%, 55% identified personalization as a “top priority” for their eCommerce technology initiatives. The study yielded even more specific insights about the strategies these businesses were targeting in the next year to 18 months.
1. Unified Platform Solutions
Seventy-nine percent of respondents found value in a single, unified platform for delivering eCommerce personalization. The respondents asserted that the primary benefits of a single platform would be improving productivity, business growth, and customer focus.
2. Advanced Capabilities Are Taking a Front Seat
The majority (53%) of professionals said that within eCommerce personalization, the following features were most important: AI and machine learning, omnichannel targeting, merchandising controls, and advanced analytics. This finding demonstrates that eCommerce professionals recognize the need to mine and use data more efficiently to increase customer engagement, and that reaching customers through multiple channels to drive overall business is well worth investing in.
3. Most Businesses Are Already Implementing Personalization
Of the eCommerce and marketing leaders surveyed, most had already made their first foray into personalization with first-generation solutions (e.g., technology to make product recommendations on their sites.) A full 43% of respondents indicated that they would be taking further steps by investing in next-gen customer engagement solutions in the next 12‒18 months.
4. There Are Four Key Areas to Invest In
In the coming 12‒18 months, 43% of respondents will continue to spend money on the personalization of retargeting emails. Beyond that, the next three most important areas of eCommerce technology investment were personalizing product recommendations (39%), web and email content (39%), and category or In the eCommerce context, a landing page is a standalone destination page generally tied to a specific URL used in email... More (37%). It’s apparent that personalized product recommendations, search, and emails together are gaining greater attention and investment than other types of eCommerce personalization. At Reflektion, we always suggest personalizing both search and recommendations simultaneously because shoppers clicking on recommendations after using search convert 3.7 times more than those who use search alone.
5. Personalization Is an Overall Technology Priority
When asked about the major technology initiatives the respondents had for 2020, the top three responses were eCommerce personalization (63%), omnichannel marketing (47%), and analytics (45%).
6. Two Critical KPIs Stand Out
In the study, respondents were asked to select the most important key performance indicators for an eCommerce personalization solution. The number one metric was An eCommerce conversion rate is the percentage of visits which result in eCommerce transactions (sales). Essentially, it... More at 37%. A close second was In eCommerce, Average Order Value (AOV) measures the monetary amount that is spent every time a customer places an order... More at 26%. Both of these metrics indicate that businesses are shooting for near-term, immediate results rather than longer-term results like customer lifetime value (CLV). Clearly, businesses are prioritizing growing site revenue, especially at the individual order level.
The Time to Invest in Personalization Is Now
Overall, the report revealed that eCommerce businesses are taking the need to provide superior customer experiences seriously, and are making material investments in real-time, 1:1 next-gen personalization AI to achieve it. Online shoppers today expect to find what they need quickly and seamlessly, and personalization AI is the most powerful way to make customers feel like retailers understand their needs. Clearly, the companies deploying next-gen customer experience AI in the next year—especially in anticipation of the holiday season—expect to achieve an impressive ROI. Not only is it evident that eCommerce companies see advanced personalization as a crucial driver of business growth, but that the risk of losing market share by using outdated, legacy systems is real.
For detailed insights, please download the full 2020 eCommerce Personalization Report. The findings reinforce the strong value proposition of Reflektion’s customer engagement platform which provides 1:1 eCommerce personalization at scale and in real time across all the marketing channels your customers love—web, mobile, email, search, and in-store. Don’t allow your business to get left behind in the AI revolution. Schedule a demo today to see how Reflektion can help grow your eCommerce business and magnify your revenue.