The growing importance of data personalisation in eCommerce – and how to get started

Imagine this: a customer clicks into your online shop, browses through a few items, then leaves without purchasing anything. The next time they see communication from you – an email or social media ad, for example – you’re letting them know how well the products they browsed would go with something they’ve previously bought. Now you’ve piqued their interest; they click through and make the purchase.

This type of high impact targeting can help customers feel like VIPs. And the key to helping them have this great experience is data-driven personalisation.

What is data personalisation and why does your business need it?

Every time a customer shops with you, they leave some breadcrumbs that you can follow to help them have a positive shopping experience. These crumbs – in the form of data – include the details of what they’ve purchased before, their behaviour on your site (the pages they visit, the links clicked and how long they stay on a page), demographics, location and how they interact with you on various channels.

With these clues, you can build knowledge of what the customer wants. The next step is using that knowledge to interact with your customer in a more personalised way: providing unique recommendations or rewards, or anticipating the next step in their shopping journey and making that step easier for them to take.

Adding this personalised relevance to the shopping experience can increase your sales: businesses say customers spend an average of 34% more when they get a personalised shopping experience¹. It can also improve the customer experience and boost customer loyalty to your brand.

The importance of data security and building trust

While collecting data is the first step in providing a more personalised service, it’s vital that you respect the trust a customer has placed in you when they have chosen to share that data.

While most customers are comfortable providing some personal information if they know it will enhance their experience, some are uncertain or uncomfortable about it². In both circumstances, they’re likely to consider your privacy policy, reputation and how you will use their data, before agreeing to share it with you².

In the latest edition of our Inside Australian Online Shopping Report, Lauren Shepherd, General Manager - Customer Data, Personalisation and Loyalty at MECCA Brands, explains this is a major consideration in the personalisation trend. “The main tenant for us is anytime we're leveraging data or even collecting it, it needs to be in a way that is adding relevance to the customer, and that we do it with the least data possible,” she says.

This matches with customer expectations, with research highlighting shoppers expect something in return for their data. When handing over their details, more than two-thirds of shoppers expect personalised experiences from retailers³  and more than half want to feel part of the brand’s community⁴.

How to start designing personalised customer experiences

Equip yourself with the right tools. Having the right software is the key to businesses of all sizes and in all industries being able to utilise data-driven personalisation, by tracking customer interactions across your website, social media channels, email, digital advertisements, search engines and more. There are several options: some sales platforms track purchases and key information, CRMs record your communications with customers and their purchases, while a Customer Data Platform (CDP) helps to collect and curate the data of each of your customers and segment them into smaller groups with similar needs.

Take a customer first approach, minus the stereotypes. While your goal might be to increase sales, it’s important to remember that the customer comes first. Let them lead the way by telling you what they want – but beware of using easy stereotypes. More than half of Australian shoppers feel negatively about retailers who use stereotypes (like generational assumptions) when trying to engage with them³.

Enhance the checkout experience. Using data to tap into your customers’ preferences continues into the checkout experience. Depending on what your customer is buying, and their previous choices, you can suggest the best shipping option for them. This could include offering alternative collection points and parcel lockers.

Target your marketing. Analyse the ways your customers interact with your marketing, and how it impacts their purchasing habits, to help you create future marketing strategies. This means your marketing budget will be spent on the most effective channels and creating personalised content.

Suggest other products. Upselling has long been a successful sales strategy and data is a modern way to do this. More than a third of shoppers say they’ve purchased something because an online shop has made a ‘You may also like’ suggestion⁵. Remember to keep it personal: most customers say they’re discouraged from buying a product when seeing live pop-ups telling them what other customers are purchasing5.

Take inspiration from the instore experience. Lauren says MECCA is working to create the best of both the instore and online worlds: “We're really talking about ways that we can use the data that the customer has provided to us to make their experience with MECCA even better,” she says. “We use that to then create journeys that are relevant and provide personalised product recommendations. What we've really tried to do is ensure someone who's shopping in the online space is getting the same personalised service that they would have if they were instore.”

Put yourself in your customers’ shoes. Think of the times you’ve needed different things from a brand. For example, when you’ve searched for accommodation for a business trip and then returned to search for a family holiday option. This highlights the importance of not making assumptions with data-driven personalisation; your goal is to understand what the customer is trying to achieve at this point in time.