The ever-changing nature of the e-commerce industry makes it difficult for brands to maintain their competitive edge. The blurring of the line between digital and physical environments has accelerated the speed of innovation and thus the pressure of this challenge. E-commerce brands can only adjust to this order by following trends and making accurate predictions.
In our last article, we discussed the trends that are predicted to arise in 2022, and one of them was a concept called hyper-personalization. Although marketing initiatives targeting specific target groups or even categorized personalities involve personalization, this may not always produce the desired result adequately. Consumers are continuously on the lookout for products and experiences that acknowledge them as unique individuals. Recognizing them as different personas can be considered the first step of hyper-personalization, but what exactly is hyper-personalization?
What is hyper-personalization?
Hyper-personalization is a marketing strategy that not only personalizes an individual’s online experience but also incorporates both data mining and artificial intelligence, to cater the user’s experience like never before. It is done by using data, analytics, and artificial intelligence.
Brands can direct their strategies to the individual rather than the broad masses in order to serve better experiences to their customers. This highly customizable service allows businesses to engage more with their audience, establish a stronger bond with consumers and generate new leads. It can seem quite similar to regular personalization, however, they greatly differ when it comes to the scale and depth of data used. These differences make their effectiveness vary immensely.
While the concept of traditional personalization contains data knowledge on a more general level through topics such as age, gender, or location; hyper-personalization can be considered as a more advanced next step. It tries to respond to the wishes and desires of people by making use of their data. For this reason, it is crucial, especially for e-commerce players.
Importance of Hyper-personalization in E-commerce
Hyper personalization is an important concept to nail as an e-commerce store. Many people use a personalization practice to influence their customer’s buying decisions. If you fail to address the growing need of accurate and actionable data, then you will be lost in the sea of competition. Users want to make sure their needs, preferences, and unique desires are understood. As they see brands that provide such understanding, they want to have a similar experience with each brand. This expectation builds a much more competitive environment for the e-commerce industry and provides many opportunities for both customers as well as brands.
Benefits of Hyper-personalization in E-commerce
>> More individualized and accurate targeting
With hyper-personalization, a much more narrow and precise target audience can be reached by utilizing data instruments. By creating a hyper-personalized customer experience and answering the right questions to meet the needs of individuals, brands can call out their targeted consumer audience in a more effective way.
>> Provide an advanced shopping experience for customers
Making your customers feel special is the core of hyper-personalization. If you understand your customers’ needs correctly you can provide personalized themes and provide better service. High-level personalization allows you to offer an enriched customer experience and increase overall customer satisfaction.
>> Increase ROI, conversion rates, AOV, and sales
When you start learning more about your customers, you can provide personalized deals, special discounts, and smart product recommendations. Through individualized promotions and accurate recommendations, hyper-personalization increases the results achieved. With your satisfied customers, you can expect an increase in conversion rates, ROI, and overall sales figures.
>> Strengthening relationship and loyalty
The insights you will gain for more personalized service allow you to construct the right communication and marketing strategy. In this way, customer loyalty increases, and your brand image is strengthened in the perception of consumers. Hyper-personalization is the right way for customers to put you first for their purchase decisions.
>> Increase customer acquisition and retention
A Gartner survey suggests that brands are losing 38% of their customers due to the lack of strong personalization efforts. Customer attention is a scarce resource. Based on their previous actions on specific channels and the business rules you apply, hyper-personalization can help you deliver content, products, and services that resonate with your customers at every stage of the journey. In this way, hyper-personalization can be one of your most powerful tools to improve acquisition and retention rates while reducing churn.
Example of Personalization in E-commerce
Most companies have evolved to an advanced level of personalization, in which AI and machine learning examine a variety of parameters to fuel their algorithms. Let’s take a look at some good examples of hyper-personalization:
>>> Customized style recommendations
Topshop designs a completely customized wardrobe for you once you answer a few questions about your aesthetic, lifestyle, and preferences, as well as your size and spending plan. They continuously add new things to your wardrobe based on likes the products offered in the wardrobe and keep consumers updated with mailings. The site also recommends specific outfits for users to match their current viewing items. In addition to generating a tailored wardrobe, it provides personalized style tips to help consumers make an informed purchasing decision.
>>> Smart bed matching for healthy sleep
The Smart Match system of Yataş enables visitors to get personalized results based on the answers they receive to personal questions asked on their website built with Inveon's platform inCommerce. Yataş's Smart Match system, which aims to increase customer satisfaction to 100%, evaluates shared personal information and sleep needs with algorithms determined as a result of research and tests, then makes recommendations.
>>> Push & in-app notifications for your coffee
Starbucks' effective usage of AI can be a good example of the hyper-personalization approach. The technology can deliver over 400,000 types of hyper-personalized texts using real-time data. Offers are tailored to each user's interests depending on their engagement and purchase history. Using an AI-based system, the app provides individualized food and beverage options to each consumer.
How to Hyper-personalize Campaigns and Customer Journey
Hyper-personalization, which is the version of personalization that involves getting to the core of individuals' behaviors with further research, seems to appear in much more creative examples in the future. Depending on your business, there are many ways to hyper-personalized your customers’ experience. In e-commerce, knowing who a customer is and what they desire can significantly impact their journey through the use of a comprehensive strategy.
Detailed analysis of customer journeys and using effective test mechanisms to evaluate all steps allows you to create hyper-personalized experiences. Accurate and efficient data must be collected but this collection is only the beginning of a complex set of processes. After that, a stretagic analysis and the ability to turn these data into actionable insights is the crucial element.
All of this may sound challenging. It is also quite clear that it requires significant expertise. Here, at Inveon, we have a team that turns these challenges into endless opportunities. Inveon GrowthLab is ready to help you with strategy development and the most effective implementation of these strategies. With a wide range of expertise in different fields, our team is here to walk through whit you on the path to sustainable digital growth.
Let’s harness the power of your data, improve the quality of the experience of your customers and increase sales. Contact with us and meet our experts today.
