Ecommerce personalization in 2024 – trends and opportunities

Ecommerce personalization has become one of the fastest-growing practices in the industry, revolutionizing the way businesses connect with their customers. Online shopping is a wonderland of choices and possibilities. On this journey, personalization becomes the guide the customers need to find the path to that perfect espresso maker. As we step into 2024, ecommerce players must recognize the growing importance of personalization and stay ahead of the trends.

In this article, we will dive into developments in ecommerce personalization and what businesses must pay attention to as they start the new year.

The Journey of Personalization

Hello, what can I help you with today? – This is how we are usually greeted when we enter a store. In a few words, we would describe what we want and like, and we’d be guided to the section with the right product.

This is where personalization started—in the physical store. This is the experience e-commerce wanted to bring online.

In the early days, email campaigns began incorporating personalized greetings and product recommendations, setting the foundation for more targeted interactions. As technology advanced, recommendation engines emerged as a game-changer. E-commerce giants like Amazon and Netflix pioneered the use of collaborative filtering algorithms, analyzing user behavior to offer personalized product recommendations.

Big Data

The rise of big data and advanced analytics paved the way for data-driven personalization. Ecommerce platforms began collecting and analyzing vast amounts of customer data, ranging from browsing history and purchase patterns to demographic information.

The AI leap

In recent years, the integration of artificial intelligence (AI) and machine learning has opened new possibilities for ecommerce platforms to go beyond traditional rule-based systems, learning and adapting in real-time to user behaviors. AI-driven algorithms power predictive analytics, offering remarkably accurate product recommendations and personalized content. We arrived way beyond asking the question What can I help you with today? Today we start with: Hello, here is the product you want, in your size and your favorite color.

Ecommerce Personalization

Omnichannel & Hyper-Personalization

The evolution of personalization isn’t confined to individual platforms. Today, ecommerce strives for omnichannel personalization, ensuring a seamless and consistent experience across various touchpoints—website, mobile app, social media, email, and more.

Looking ahead, the near future shows a trend toward hyper-personalization. With advancements in AI, businesses are exploring ways to tailor every aspect of the customer experience, from personalized pricing and individualized promotions to dynamically adapting website interfaces based on user preferences.

What makes a great personalized experience today

Ecommerce personalization can be executed in various ways and to different levels. It depends on the audience preferences, buying habits, industry, and other factors. Nevertheless, a good approach ensures that you:

Show the right products
When searching or exploring products, the content shown across the customer journey should cater to the customer’s interests. For instance, if I just bought an espresso maker, I would be thrilled to see some good espresso coffee beans recommended to me.

Show the right offer
It’s important to understand what is valuable to the customer. Often, consumers receive promotional emails that don’t meet any of their preferences. They expect brands to know what price range, style, or category is of interest to them. With the right offers, the customer feels understood and is more likely to return to the site.

Using Product Intelligence we identified that shaving cream is more likely to be purchased at around 7 am.

Pick the right moment
Timing is highly important when it comes to decision-making. Evenings are traditionally more popular for online shopping but is not a strict rule. For instance, Hello Retail’s Product Intelligence finds that shaving cream is often purchased in the early hours, possibly when customers notice they are running out of it after their morning shave.

Be transparent
Consumers are very aware of how their data is collected and used. And they also know that not all tracking carries a negative impact. Therefore, if you need customer data to make their experience better, transparent communication will be welcomed by your customers.

Deliver value
Our time and attention are valuable, therefore we expect to be presented with valuable content. Customers purchase from brands they resonate with, so make sure to communicate your brand values clearly to find your soulmate customer.

Ecommerce personalization trends

customer loyalty

Increasing importance of data
Personalization software is now more capable to operate with multiple data points simultaneously and combining data to personalize customer journeys. Zero-party data, for instance, is now being tracked by more brands. Zero-party data is intentionally provided by users to share their preferences and intentions with the brand in exchange for a personalized user experience.

More focus on growing customer loyalty
From a research report by McKinsey, we learn that consumers are more likely to repurchase from brands that provide personalization. For brands, returning customers are highly valuable not just because of the lower cost per conversion, but also because they get a chance to build lasting relationships and provide them with highly personalized experiences every time they return.

AI-powered solutions
Artificial Intelligence took a grandiose step in 2023, and it can only go further in 2024. We expect to see more businesses using AI to optimize, grow and improve. Data from G2’s ecommerce personalization software category shows that software with AI capabilities takes a shorter time to realize ROI benefits, than the one without.

Customer Loyalty

Balancing personalization with user privacy
At the start of 2024, Chrome began the long-planned phasing out of third-party cookies. Tracking Protection will restrict website access to third-party cookies by default. This step tells us a lot about the trends we begin to see with user tracking. A good tip is to keep an eye on this topic, be agile, and always comply with regulations.

Contextualized experiences
Ecommercers work tirelessly to build platforms that are user-friendly and personalized. However, it’s important to remember that customers do not exist in the ecommerce bubble. We see a trend in including the context when designing personalized experiences. The time of day, location, current events, weather, all these factors influence consumer behavior and should be considered.

Ecommerce Personalization

In 2024,…

…ecommerce managers will need to navigate a variety of tools and technologies making their way into the industry. Some of them will prove to be more challenging to adopt than others. Therefore it’s important to be strategic and prioritize what brings more value to the customer and to the business. Ecommerce Personalization is not a size fits all but is becoming a common expectation, and with the right solution and guidance, it can become a driver of business and customer satisfaction.

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