The Definition of Personalization in ECommerce

#Personalization

Personalization is one of the trending topics these days. Especially in e-commerce, where everyone knows and uses this word, and some marketers are also  able to personalize  content efficiently. But what is the exact definition of personalization? We looked for opinions of other bloggers and marketers and have tried to compare them with our thoughts.

The Basic Definition of Personalization

James Doman, who is a Recommendation Engine Expert at Kayako gives a very comprehent definition of Personalization on Quora. “Personalization technology enables the dynamic insertion, customization or suggestion of content in any format that is relevant to the individual user, based on the user’s implicit behaviour and preferences, and explicitly given details.

The definition doesn’t mention how the content can be generated. It can be created through recommendation systems, adaptive personalization techniques or collective intelligence. He also thinks there are four levels to personalization: Customization, Crowd Personalization, Segmented Personalization and One-to-one personalization. Another marketer, Rita Brogley has a very different approach on marketingprofs:Personalization creates a better understanding of known and unknown consumers.” It means, using the right tools, marketers can gain greater visibility into customer’s online shopping behaviors and learn when, how often, and what device they use to shop.

The digital footprints of the customers help companies to understand their target group, create segments and personalize the content for them. Having that information readily available enables retailers to better gain and acquire new customers. Technology has made tracking and maintaining this relationship with the consumer across all channels possible.

The Definition of Personalization in ECommerce

 

Misunderstandings about Personalization

Joelle Kaufman, Head of Marketing and Partnerships at BloomReach explains, that for most people, personalization really just means “targeting by segment” and primarily takes the form of sending different emails to people belonging to different segments. But that is nothing compared to the methods of market leader companies like Amazon or Netflix. “Really good personalization,” Joelle said, “doesn’t feel like it’s happening.” Tina Johnson-Marcel on marketingprofs mentions, that many people mix personalization with customization. “Many marketers believe an immediate and mirror-like response to a customer’s needs provides a personalized experience—except it doesn’t. That’s not personalization, that’s customization.” Personalization is collecting implicit or explicit user information to create a content delivery framework that not only manipulates what information is presented to the users, but has an effect on how it is presented. On the other hand customization is when a user or customer explicitly states preferences and receives information or a product that matches those interests.

Our Definition of Personalization

The ultimate goal is to have as many versions of a website as many visitors it gets. I know it’s a long road there, but we already can see the signs. From A/B testing to DMPs, recommendation engines and programmatic. The key should be to give people what they want. If someone doesn’t want to be tracked, then don’t do it. But if someone wishes to share their information in order to get better experience, we should do our best to provide it.

To do the best we need to analyze data from many channels, way more than what we can handle now. We should put these into 3 catetegories: purchase history, site activity, digital footprint from Facebook.

All these combined can give enough data do provide a personalized experience. Later we will have further data like what was listened to on spotify, where did they drive, where do they stand, etc. Using all this, and combining them will end up like a world we would see in minority report.

by Péter Szántó
on Wednesday, May 25, 2016

Be the first who reads our next article!

Weekly selection of the best personalization, business intelligence and conversion optimization articles.

It's time to check your inbox! ;)

In order to continue, you have to accept our legal conditions.

If you want to sign up without facebook, you have to provide an email address.

With subscribing on our weekly newsletter you are agreeing to the Terms of Use and Privacy Policy.