E-Commerce News: E-Commerce: Enthroning the E-Shopper

March 6, 2008

In a recent article on E-Commerce news, Enthroning the E-Shopper, Paul Korzeniowski brought up some great points about the value of personalization in the e-commerce world. Specifically, he identifies the youthful state of the approach, its’ ability to increase customer loyalty, and he details several personalization opportunities and functionality. He summarizes the situation very well… “Building brand loyalty has become a struggle for retailers; however, personalization has the potential to help them to enhance customer allegiance and differentiate their products in highly competitive markets. Though in an early stage of evolution at the moment, customized shopping experiences are expected to become more common as the e-commerce market’s ongoing maturation continues.”

Etailers have historically been slow adopters of new technology, preferring to watch for success at competitors before dipping their toe in the water. Examining the evolution of dialog in this industry, just recently simple testing scenarios were all the rage and today we’re hearing this great dialog about targeting consumer needs… this is a huge shift in thought and a wonderful thing to see! In some regards, this is probably an evolution from consumer generated content, more than a shift from testing to personalization, regardless I love it!

One area I would like to elaborate upon is the forms of personalization he details:  from targeting online behaviors to physical goods. The point I would like to make is that these really shouldn’t be viewed as separate efforts, rather, a continuation of a strategy to learn more about prospects and customers and start servicing their needs. That is, if you’re going to manage a program for customization of physical goods, say jeans, why would you not augment that with a program to reinforce those expressed needs when a user comes back to a homepage or receives an email?

Using this example, when a consumer designs a personalized pair of jeans, how much more successful would the campaign be if the ensuing communications on the website, email, and direct mail offered a coordinated communications effort focused on: showing matching accessories and additional fabrics that fit the same genre of jean, then later, as the seasons change, offer different styles and fabric weights that are appropriate for the temperature.

Creating additional sophistication in this campaign, consider the efficiency a retailer could generate if they were to track the responses of this consumer, as they respond to the different communications channels. Over time, one could determine more than just the relevant message, but also, the preferred methods of communication.

It’s the same customer. They have the same needs regardless of product or communications channel.

Yes, there is a lifespan associated with behavioral learning, relevance decays rather quickly. These types of campaigns are most successful if the retailer can generate a response in the first few weeks. However, the reality is that the rate of decay is very specific to environmental variables associated with each use-case. This decay should be a part of the measurement and analysis process so one can optimize their program over time.

Wrapping up my point, focusing on single slice of your relationship with your customers and producing a personalized communication is a great start but must be seen as the first step of a larger program. Learning from consumers that cross your path, storing that data in a central data database where future programs can consume and contribute visitor level data, is the single largest key that a marketer can build into their strategy to increase relevance.

Personalization campaigns must transcend individual contact points – web pages, emails, banners, and even physical goods.

Love to hear your thoughts –

Mark

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