I’ve been following personalization since, well, forever. That being when I started my firm in 1998.
That’s about the same time that Peppers and Rogers published their seminal book, The One to One Future where they proposed a simple and powerful idea. Instead of organizing marketing around products, why not build relationships around customers, one at a time. Personalization was off and running, with companies like Personify trying (and failing) to capitalize.
Not much has changed in 20 years. Consumers want personalization. Companies say they want to provide it. Most don’t.
Technology is essential to delivering “implicit” personalization based on what some marketers call “digital body language” — the digital footprints left behind as users search, use devices, look at web pages, etc. But “explicit” personalization is also important, because it allows customers to share their preferences, profile information and other details hard to glean from digital behaviors.
OK, so why the slow progress? Here’s a poll we conducted on a personalization webinar we conducted last year.
Now this for sure is not a scientific poll. But here we have a webinar about personalization with business leaders attending who are interested in the topic, and yet the vast majority are still trying to figure it out. I draw your attention to the list of obstacles which show a broad range of issues, none of which really stand out.
It’s not that there aren’t success stories. That same webinar featured digital marketing and VoC expert Ernan Roman, who has covered the topic many times in his CustomerThink Advisor column Innovation in Personalization and CX. Ernan argues that customer preferences should be part of the equation, and the webinar featured a case study about Gilt that shows a combination of implicit and explicit preference can drive impressive business results.
Case studies can illustrate what’s possible, but they are not research. Into that breach steps Qubit — a provider of “personalization at scale” — which conducted a massive study of over 2 billion ecommerce user journeys and 120 million purchases, to figure out what really works.
For those short on time, here’s the bottom line. Skip cosmetic changes like page redesign, navigation changes and new buttons. They don’t move the needle on Revenue Per Visitor (RPV) according to the study.
The top three: scarcity, social proof, and urgency.
Scarcity and urgency are obvious, but what is “social proof”? Jay McCarthy, VP of Product Marketing at Qubit, says it can include “other people are looking” messaging. We humans like to do things others are doing, so now I know why Expedia tells me how many people are looking at a hotel I’m considering “right now.”
This is a huge study, with a full report available here (free registration required).
Here are 3 big findings that caught my eye:
- Loyalty? Not so much.
Consumers tend to concentrate their shopping on a few sites, but “only 16% say that they would remain loyal to those stores if they fell behind in quality and value of service.”
- Consumers don’t know what influences them
According to the study, almost half of consumers don’t think other shoppers’ habits (social proof) influence them, despite it being the second most effective technique.
- Too much of a good thing is, um, bad for trust
Sure, scarcity and urgency drive action, but you can’t do a “flash sale” every day, ok?
Qubit says that businesses using a variety of techniques can see as much as 6% revenue uplift, with targeted experiences three times better at driving RPV.
So there you have it. Ecommerce personalization really can work. Kudos to Qubit for conducting solid research to shed some light on a complex and important topic.
Author : Bob Thompson
Bob Thompson is CEO of CustomerThink Corp., an independent research and publishing firm focused on customer-centric business management, and Founder/Editor-in-Chief of CustomerThink.com, the world’s largest community dedicated to customer-centric business. Thompson is a popular international keynote speaker, blogger and author of Hooked On Customers: The Five Habits of Legendary Customer-Centric Companies.