What is personalized marketing and why is it for online stores?

Let’s start with what personalized marketing is?

One example of personalized marketing could be setting up personalized product recommendations on an online store’s website based on previous purchases, product views, and other customer characteristics.

This is most often achieved through three main directions:

Implement lead-generating forms. The goal is to convert visitors into leads and encourage them to make their first purchase.

Connect trigger emails. Important: we base this on the latest interests and user behavior. Statistics show an average open rate of 60-80%, with a click-through rate of 40-60%.

Set up personalized product recommendations:

• Increase the average order value within a single session. All settings are made based on our experience.
• Send a personal offer for the next purchase, stimulate visitors’ interest in the site, and bring them back into the sales funnel.

And an additional direction: working on abandoned carts, if the visitor’s email is unknown, but we have their phone number (+15% to sales).

The main goal of personalized marketing:

Fig. 1 – Use of personalized marketing

Increasing conversion

To achieve this, the following are used:

• lead-generating forms that identify visitors interested in making a purchase;
• a set of automated trigger emails that guide the visitor to their first purchase;
• product recommendation blocks in conjunction with trigger emails, which facilitate the second and subsequent purchases.

Reducing CPO

For example, this is a top priority for small stores.

Increasing average order value

There are two algorithms: cart upsell and offer upsell. Cart upsell works in the cart and recommends products that go well with the items the visitor has added to their cart. Offer upsell works on the product page, analyzing the purchase history of that product with other products.

Increasing LTV

Working on purchase frequency. Here we tailor a personal offer for the next purchase. For example, we send email chains that will warm up interest: post-sale, welcome series, best offer, etc.

Personalized marketing has many advantages for online stores, but there are also some drawbacks. Let’s take a closer look at them.

Pros of personalized marketing for online stores

Increased conversion and sales

Personalized marketing allows online stores to provide customers with more relevant information and offers, leading to a higher likelihood of making a purchase.

Improved understanding of customers

Personalized marketing helps online stores better understand their customers and provide them with a more convenient and individualized shopping experience.

Establishing customer loyalty

Providing personalized offers and recommendations helps online stores build long-term relationships with customers and increase their loyalty.

Increased effectiveness of advertising campaigns

Personalized marketing allows online stores to create more targeted marketing campaigns that will be more effective for specific audiences.

Cons of personalized marketing for online stores

Difficulties in processing large amounts of data

To use personalized marketing, online stores must have sufficient resources to collect, process, and analyze large volumes of customer data.

Risks of privacy and data protection violations

When using personalized marketing, online stores must consider the privacy and data protection of customers, which can be complex and require additional costs.

Risk of insufficient personalization

If personalization is not done properly, customers may receive irrelevant recommendations and offers, which can lead to a negative shopping experience.

Despite this, personalized marketing helps online stores better understand their customers and provide them with more relevant products and services. This allows for increased sales, improved customer satisfaction, and the establishment of long-term relationships with them.

To dive deeper into the topic, you have the opportunity to check out the report in video format with answers to questions.