Do you know 91% of shoppers would abandon an online retailer over a poor shopping experience? To meet their preferences, retailers must personalize their experiences. More than 3 out of 4 shoppers want a more personalized shopping experience. As a result, conversion rates increase by more than 40%, cart abandonment rates drop below 50%, and revenue per user increases by more than 10% for many retailers, demonstrating the benefits of transforming data into actionable items that maximize every click.
That’s a lot, isn’t it? Stay with us, as we want to show you some insights from Ecommerce Personalization Benchmark Report 2021 from Netcore and Wakefield Research.
Main points
Retailers benefit from personalization by generating more page views, which leads to increased sales. For example, customers view 8 products on average before making a purchase. Still, personalization helps most retailers achieve at least 10 page views per customer, ensuring they see more than enough relevant products to make a purchase.
Personalization increases conversion rates by 45% on average for retailers. Retailers previously had cart abandonment rates of 60% or more, but the average dropped to 46% after personalization.
Personalization challenges
Although 62% of retailers claim to have improved their personalized shopping experience over the last year, 45% of shoppers have not experienced any improvement.
source: Netcore’s Ecommerce Personalization Benchmark Report 2021
96% of retailers say they have encountered some challenges in implementing personalization, indicating a growing need to rely on trusted third parties to personalize the shopping experience for their customers.
source: Netcore’s Ecommerce Personalization Benchmark Report 2021
Meaningful personalization encourages shoppers to stick with a retailer – but will drive them away when implemented poorly. The majority of retailers have accurate data about shoppers’ preferences. If offers are not relevant to them, 1 in 4 are more likely to abandon their carts. Additionally, one-third of shoppers are more likely to unsubscribe from a mailing list if emails aren’t relevant.
Rewards to Reap
58% of shoppers believe that custom touchpoints can help them find products faster, and 28 percent are more likely to purchase a product they didn’t intend to buy at first. Additionally, 26% of respondents say that a personalized experience can make them more likely to buy something more expensive than they originally planned and 29% are less likely to abandon their shopping carts during a customized shopping experience.
Personalization efforts have proven worthwhile for retailers: 71% have seen overall returns of at least 4 times their investment in personalization.
source: Netcore’s Ecommerce Personalization Benchmark Report 2021
Consumers are making more purchases at retailers with personalization, and they are spending more money as well. All have seen increases in average order value (98%) and revenue per user (97%). Also, consumers and retailers benefit from personalizing ecommerce platforms. Shoppers who receive personalized service become more loyal to a retailer.
Retail Category Findings
source: Netcore’s Ecommerce Personalization Benchmark Report 2021
Across various retailers, personalization has a positive effect on cart abandonment rates. Markets, brands and companies that sell multiple products achieve rates below 50%. In addition, customers are most likely to stay with marketplace retailers and retailers that sell groceries or jewelry after investing in personalization.
source: Netcore’s Ecommerce Personalization Benchmark Report 2021
Most retailers (97%) increase revenue per user after investing in personalization, with significant numbers across all retailer types achieving growth of at least 10%. All retailers average 22% of products viewed being added to carts, but some categories, such as those that sell groceries or cosmetics, outperform.
source: Netcore’s Ecommerce Personalization Benchmark Report 2021
Trends and innovation areas
Retailers need to understand how customers shop to make the most of those visits. Visual searching is becoming more and more critical. For example, 3 out of 5 retailers expect to focus on visual search in the next 5 years! Also, hyper personalization is on the rise. In the coming years, retailers expect real-time behavioral data to focus. What’s more, gamification is more popular too. A majority of retailers said that gamification helped them improve their crucial ecommerce metrics. What do you think about touchless shopping? More than 2 in 5 retailers plan to focus on initiatives that let shoppers shop from any smart device using only their voice. Augmented and virtual reality is also our future. According to a third of retailers, interactive technology will allow customers to “try before they buy” by 2026.
To sum up
Consumers have made it abundantly clear that they want personalized ecommerce platforms that make their experience easier, faster and more accurate. Otherwise, retailers may lose customers. Unfortunately, many retailers face obstacles ranging from inadequate IT bandwidth to insufficient tools, so they must develop strategies to improve their platform’s personalization or risk being left behind.
