Practical Ecommerce

Chart of The Week: Personalized Product Recommendations

Nearly 28 percent of online retailers now offer personalized product recommendations, according to a recent survey.

Personalized recommendations like those offered on the popular Netflix video site help customers engage. Typically, these recommendation systems use historical customer data and algorithms based on overall customer behavior patterns to offer customers similar or related products.

According to Internet marketing research firm eMarketer, “Until recently only large retailers had the money, expertise and time to develop the complex algorithms that drive personalized product recommendation systems. But the market has advanced and a number of vendors have proven they can deliver real customer value. Now the technology is affordable to even small retailers.”

eMarketer also pointed to research from Vovici, indicating that some 27.6 online retailers already offered some form of personalized product recommendations.

Practical Ecommerce

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  1. Jim O'Neill April 2, 2009 Reply

    This technology is definitely available to almost any retailer. Beanbasket (as most other web store management systems) has as a standard feature related items – in fact we have multiple related item types so you can offer up sells and /or cross sells showing different products in different places on the site. For example cross sells of other clothing by that particular designer would show on the item detail page and an up sell of a complimentary handbag would show on the checkout page. That is a cool and effective tool. It requires only that you set up those relationships and obviously allow for them in the design – where do you want them, how big are the images, etc.

    Adding the intelligent, personalized, recommendations capabilities carries that a big step forward. For example if someone comes to your site via a Google search for a particular item we know to recommend another similar item just slightly higher priced and one just lower priced. And if they have purchased a particular style or brand to recommend those as well. If they shop clearance items we know to recommend those, etc. This intelligent recommendation tool has shown to increase conversions 5% – 20%. Again you just need to design for the space as with the manual recommendations. Carrying it to your marketing, you can even tie email campaigns that remember what the person was looking at to those images in the email.

  2. Jan Riley April 7, 2009 Reply

    Product review and ratings do much more than rate a product, it is the on page version of a customer testimonial, and often supplies important detailed information that might be missing in the product description. These reviews are often the "tipping point" for online buyers nudging them towards a buy or towards another site.

    Whatever it takes – encourage your customers to fill out reviews!
    They are invaluable insights on how your customers see your products – even the not so flattering comments – People trust other peoples opinions MORE than they trust what you say on your website.

    The combination of relevant descriptions and user reviews can be a powerful selling tool for e commerce.