In Venice in 1498, the publisher Aldus Manutius created a catalog of the books he printed.
Fifteenth-century Europe was going through an editorial revolution. The invention of the Gutenberg press and movable type in the mid-1400s opened up a world of mass printing. By the end of the century, there were 417 presses in Venice alone – one of the main centers of printing – and the output of the Western European printing industry had reached twenty million volumes.
With a (relatively) immense range of books available, the catalog must have been a useful marketing mechanism for Manutius. It was a booming industry, a new medium. And Alde Manutius, whose business was new media, used this new media to better serve his customers and his business.
So it was (perhaps) the very first catalog. And from there, catalogs went mainstream for centuries.
Why did the catalogs work so well?
- They have combined a comprehensive list of available products with product and pricing information.
- They have made all this information available to customers in an easily accessible and convenient way.
- They also established a two-way relationship between suppliers and customers, breaking down a single transaction into several different interactions: sending the catalog; mail-order purchase; deliver the product; then, the following month, quarter or year, the dispatch of the following catalogue.
The decline of the catalog and the rise of the e-commerce website
The rise of the Internet and the emergence of the website marked the end of the dominance of the catalog over practical retail. And now e-commerce is ushering in a seismic shift for physical stores.
There is a familiar metaphor of the website as the storefront of a brand. But it’s not big enough. About 90% of today’s e-commerce websites aren’t too far removed from simple, old-fashioned catalog businesses. The website is convenient for your customers, combining your product catalog, price list and order form. But he can do much more.
The “plus” that the website can do (which the catalog can’t) is the little big relational touches. A seller can send a catalog with notes and tabs “This range is brand new” or “these would go great with the X you bought last month…” but producing an entirely different catalog for each customer (or even group of customers) is prohibitively expensive in the printing world. Similarly, it would be ridiculous to change the layout of a physical store and (for example) hide all the wrong size clothes for every new customer to walk through the door.
But on the website, customization becomes possible on a massive scale.
Indeed, it impacts every element of a brand’s business and affects every step of the customer journey. The website is not only a channel for customer acquisition teams, it is also a tool for teams whose mission is to retain customers and ensure their continued commitment.
But modern consumers have high expectations when it comes to their relationships with brands. They expect to be remembered, to have their preferences taken into account, to be valued. Otherwise, they won’t come back.
Personalization and loyalty
About 70% to 80% of customers are one-time buyers, only about 20% repeat, according to our research. And, just as the Pareto principle dictates, those 20% of customers generate the highest 80% of revenue.
For many brands, loyalty and retention are the main issues. This is where customization can really play a major role.
Personalization is about delivering the right message to the right place, at the right time, to the right person. It’s entirely contextual. Websites give you context: you know what customers are doing on your site, and when. You can see their preferences. Then you can use that information to present a visitor with new and relevant information that they want and can use. Personalization is also about having the kind of relationship where visitors trust brands to deliver relevant experiences.
But most importantly, personalization is a matter of trust. It’s about building a relationship where customers are happy to share their preferences and opinions, and for brands to use that information to shape experiences, across the customer journey. And that includes after-sales.
Brands can use personalization to turn this post-first-purchase period into a pre-next purchase period. Deliver exceptional customer experiences and service, create habits and delight customers
Top tips for implementing a great personalization strategy include:
- Collect relevant data points based on your business goals and customer journey.
- Make sure you take the time to understand your data, create hypotheses, and test them.
- Have a way to use data in real time (at the right time, in the right place and with the right message).
- Set metrics on how you will measure success.
How to create a personalization program based on trust?
A personalization project is about releasing data and putting it into action.
Segmentation is an integral part of personalization and what makes it scalable. When you have the tools to adapt the way you treat a group of people, the marginal cost of curating experiences for the rest is insignificant. Given this, brands should consider creating a meaningful segmentation strategy. Then you can consider offering personalized experiences tailored to each customer group.
Like the Aldus Manutius catalogue, it is about brands to better serve their customers and their businesses. It’s about providing all the information customers want, in a contextual, relevant and practical way. About creating two-way and continuous interactions.
And for that, you need data points that tell you when and where to act: insight into what your customers want and like. What is the next step in their customer journey and what is relevant at this point. With all of this in hand, you can then customize the experience. This means that the message, the interactions, the types of social proof, the recommendation algorithm…everything you do can be based on the customer context and delivered at the right time.
In luxury retail, for example, you can show VIP visitors personalized pages with the VIP phone line prominently displayed, or an invitation to an exclusive upcoming event with their favorite designers. In health and beauty, you can target shoppers with reminders that their foundation is sold out, based on when they last purchased, and prompt them to reorder.
The best sellers understand buyers’ buying signals and behavior. They also check in at the right time, check customer satisfaction, upsell a a service: “The new season collection has arrived, there are pieces that…”. They recognize and remember customers, making everyone feel special. They do more than sell products, they sell positive emotions and happy memories.
This is the goal of personalization and what marketers should achieve through their e-commerce websites. This is when customer interactions become relationships and consistent experiences, delivered over time, build trust and loyalty.
And in the future?
Modern e-commerce websites don’t look much like early catalogs, but the format is still quite similar: product listings by category. The next big revolution will likely be inspired by social media, transforming the way visitors experience products, making them more organic, organizing them by (expected) visitor interest rather than type. The future is customer-centric, and brands need to ensure their top personalization priorities are to build trust and loyalty.
Emre Baran is co-founder and CTO of Qubit, the leader in marketing personalization technology. Prior to founding Qubit, he was a senior product manager at Google, working on AdWords and AdSense products, building large-scale artificial intelligence and analytics systems to scale and automate operations. And before Google, Baran was co-founder and CTO of Yonja.com, Turkey’s largest social network.