As we move towards 2022, personalisation remains at the top of every retailer’s agenda.
It is easy to see why.
A McKinsey report finds that ecommerce personalisation can lead to:
20 percent higher customer-satisfaction rates
A 10 to 15 percent boost in sales-conversion rates
A reduction in marketing and sales costs of around 10 to 20 percent
The same report then states that personalisation is now a “hygiene factor” for consumers. They simply expect their interactions with a brand to take their individual needs into account.
But is this really true?
Have brands fully delivered on the promise of personalisation?
Or are we only scratching the surface?
It is true that Amazon has lifted expectations across the board with its recommendation engines. Grocery websites have followed suit with much more personalised customer journey. Beauty brands like Sephora continue to raise the bar.
And yet, personalisation can achieve much more than even these exceptional use cases demonstrate.
After a period of accelerated adoption through 2020 and 2021, retailers are better equipped than ever to add advanced technology to their websites and apps.
Below are five trends to focus on as we move into 2022.
1. Multimodal search
What is it?
Multimodal search can take data inputs from various different modes (text, image, and video, for example) and blend them into a search query.
This is invaluable, as each of these inputs will provide more information about customer intent. When a customer searches using an image of clothing, object detection can recognise the item in the image quickly. However, it cannot understand what the customer wants to see next. Do they want to buy the item? Would they like to see complementary items? Or are they inspired by the pattern?
With multimodal search, computer vision and natural language processing combine to use these real-time signals and personalise the customer’s journey.
Tech giants like Google and Pinterest are increasingly using this approach to search. 2022 is the year multimodal search will take off.
Why should retailers care?
Multimodal search captures more information about the customer and delivers more accurate results in turn.
Cadeera is helping retailers to implement this technology on their own websites today, so they are not dependent on Google to improve their customer experience. Get in touch to schedule a demo.
2. In-session retargeting
What is it?
In-session retargeting occurs when a retailer shows retargeting ads within their own website or app. If retailers gather high-quality data from customers as they browse, they can tailor the experience and curate recommendations for each individual.
Today, this type of retargeting is often limited to pop-up interstitials such as this example from Sunspel:
Yet this is just the starting point of the customer journey. If retailers can segment their audience in real-time, they can then show relevant offers and styles before the customer leaves the site. As the industry grows in sophistication, these tactics will become less intrusive and more thoughtful.
Why should retailers care?
Off-site retargeting is increasingly difficult, due to a reduction in third-party data. Retailers must focus more on their own first-party data to nurture leads. Retargeting is a proven means of achieving this, but the onus is now on brands to take control.
3. Headless commerce
What is it?
Headless commerce refers to a decoupled ecommerce architecture. This means that the front-end and back-end are no longer tied together, allowing for greater personalisation through an API-driven customer layer. It is a significant development for ecommerce and will finally help deliver the true personalisation customers crave. Large platforms like Shopify are already offering this capability and even more retailers will adopt headless commerce through 2022.
Why should retailers care?
The current web architecture is restrictive and developed for text-based keyword search. As customers access brands from more touch points, they will expect even more agility from retailers. Headless commerce can help tailor content for a wide range of devices.
4. Zero-party data
What is it?
Zero-party data is a new term created by Forrester. It refers to data that customers willingly offer up to brands, in the form of surveys or short questionnaires.
Businesses like Nike have done an excellent job of asking their customers to state their preferences. The responses are then used to influence the content and products each customer sees. As a result, there is greater transparency about the data brands are capturing and how they are using it.
Why should retailers care?
Zero-party data can be more effective than observational data, which relies on assumptions about the customer. Zero-party data asks them up front to state their interests. Customers are free to ignore these questions, so brands must make the value exchange clear. Customers are time-poor and will need to know how this benefits them.
Those that get this right can develop trust with their audience and achieve higher retention rates.
5. Social commerce
What is it?
Social commerce is the convergence of ecommerce with social media.
As it stands, the definition of “social commerce” is narrow. It typically relates to making a purchase on social media, without leaving the platform. For example, if a brand has a store built on Instagram they can sell products through this interface.
The “social” element of “social commerce” remains unexplored, however. As people shop more on social networks, brands will introduce more collaborative features. For example, friends could use a virtual showroom to try on outfits and give feedback to each other.
Examples of social commerce
Pinduoduo in China has already shown what is possible with a truly social selling model. Customers can create teams to buy products in bulk, which leads to price reductions. There is an incentive for people to share their groups, as more people will lead to greater reductions.
At the other end of the sociability scale, we should not forget about messaging platforms like WhatsApp. These are better for a more intimate shopping experience, as Yoox Net-A-Porter demonstrated with its popular personal shopper:
This leads to conversational commerce, which creates data retailers can use to personalise interactions on other channels.
Why should retailers care?
Social media is fantastic for inspiration, but it still lags behind ecommerce platforms when it comes to closing sales.
Yet retailers should also look beyond social media to understand the impact of social commerce. It is arguable that Google’s move into more visual forms of ecommerce is driven by this new competition. Social media is reshaping customer expectations beyond the confines of specific social network.
With shoppable TV and livestream shopping set to grow further in 2022, retailers should explore the potential of this technology for personalisation.
