Acquiring new customers is a challenging and costly endeavor in the best of times, let alone during an economic downturn. This is why converting first-time customers into repeat shoppers is incredibly important to e-retailers. To that end, online marketers must effectively re-engage new customers by combining individually targeted promotions and offers with one-to-one product merchandizing. Personalization-based marketing and merchandizing services, when deployed wisely and cohesively across all sales channels, can greatly improve an e-retailer’s bottom line while positively impacting the consumer’s overall shopping experience.

Too often, e-retailers rely on traditional techniques to encourage buyers to return. These tactics range from promotional discounts to free shipping. While useful in obtaining new customers, these techniques are not as effective for re-engaging one-time customers and don’t leverage the capabilities unique to online retailers. What’s more, these techniques often eat into profits and typically result in training shoppers to wait for such discounts at the retailer’s expense.

Personalized direct marketing, however, is a cost-effective alternative proven to help e-retailers build customer loyalty without giving margin away unnecessarily. By enticing customers with relevant product promotions after they leave the store—for example, recommendations made in a confirmation e-mail or personalized offers in e-mail marketing campaigns—e-retailers can increase the frequency of repeat visits and average purchase size. Once a customer has responded to an offer, it’s important to continue presenting the most personally relevant products to that shopper based on his or her previous and in-session behavior throughout the online shopping experience.

Online shoppers have grown accustomed to searching through an overabundant inventory, spending time browsing for items on a site that does not quickly (if ever) recognize who they are, remember what their interests are, or predict what they are most likely to purchase. The amount of time spent searching and browsing can cause the consumer to abandon a shopping cart, purchase fewer items or shop at another store. Personalized product recommendations give consumers a more relevant experience, similar to the personal interaction they expect at their favorite brick-and-mortar store, providing customers with recommendations tailored to their particular tastes and needs. So, what are the best practices for implementing personalized product recommendations as part of direct marketing campaigns? (more…)

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