Personalization Benefits

By putting personalization into practice, you will:

• Increase conversion rates. Improving the relevance of recommendations and offers increases the customer's likelihood to buy.
  
• Increase order sizes. More relevant cross-sells and up-sells increase the probability of the customer purchasing more than one product.
  
• Create customer loyalty. Presenting personally relevant content and giving each individual a satisfying user experience will save them time, create convenience, foster trust, and motivate repeat visits.
  
• Enhance lifetime customer value. Improving loyalty and increasing order sizes combine to enhance the lifetime value of customers.
  
• Reduce operating expenses. Delivering the right information and advice enables customers to complete transactions without assistance from service representatives more often, which reduces the cost of the transaction.
  
• Develop more effective merchandising and marketing programs. E-sellers can cross-sell and up-sell more effectively and efficiently using intuitive tools that allow you to manage personalized offers.
  
• Gain greater customer insight. Customer information and intelligence captured in the personalization process can be leveraged across all channels to make every interaction more relevant and fulfilling.

Personalization in Practice

Personalization can be infused throughout your Web site to ensure that relevant content is delivered to your customer in every given situation.

E-sellers are using personalization:

• At Checkout: By introducing targeted cross-sells and up-sells at checkout, e-sellers are able to increase their order size.
  
• On the Homepage: Leveraging customer history, the referring Web site, adwords used, Google search term used, or banner ad clicked, dynamic homepages can be served up with content most likely to interest and engage a given customer.
  
• For Product Recommendations: Leverage customer profiles and preferences to make more intelligent product recommendations as customers browse your site.
  
• In Promotions: Rather than blast out one-size-fits-all promotions, e-seller can serve up compelling promotions based on customers' click history or order history.
  
• Across Navigation Menus: Help customers find what they're looking for by automatically personalizing the navigation menus; meanwhile, filter out menu options that are not relevant.
  
• In Search Results: Increase the search relevance and conversion rates within your site by delivering targeted search results based on rules that leverage search terms and the visitor's profile or segment.

Types of Personalization

While there are many ways to personalize, using many different criteria, we highlight three overall categories of personalization that can strengthen the customer experience on your site:

• Rules-based — Leverages ATG's profile management, segmentation, content targeting, and rules builder.
  
• Event-driven multi-stage — Leverages ATG’s Adaptive Scenario Engine to create targeted campaigns that are more complex and span time.
  
• Automated — Leverages ATG Recommendations (formerly CleverSet) capabilities to understand the visitor’s real time behavior and natural product affinities to automate the delivery of intelligent recommendations and more effective cross-sells and up-sells.

Rules-based

• "Anonymous" Personalization
  Personalization doesn't require you to get every customer to log in and fill out a profile. The information you need can be gleaned even without the customer's active participation. Your Web site lets you learn about your visitor — even if she remains anonymous — by seeing what types of products she browses, what articles she reads, what searches she runs, or what questions she asks on the self-service site. Your Web site content can then be dynamically tailored for your visitor in an instant, as soon as it identifies the visitor.
  
• Personalization informed by customer history and past behavior
  Of course, the more you know about the customer, the more relevance you can infuse into your interactions. By accessing your visitor's buying history so that you know what products she already owns as well as which ones have interested her historically, you can create a highly-relevant and fulfilling interaction.
  
• Personalization that offers live interaction
  Monitoring your customers' actions in real time can bring personalization to the truly intimate level. By proactively offering online shoppers the opportunity to contact a service agent using click-to-call or click-to-chat functionality, you can engage customers at the most relevant time, such as when a shopping cart is at risk of being abandoned, or when the consumer's Web behavior implies confusion. Or you may choose to offer live help only to high-valued customers or big-ticket transactions.
  

Event-driven, multi-stage personalization

Building on rules-based personalization, you can drive even more relevance by introducing multi-stage, scenario-based personalization. A scenario is a way of taking a rich set of customer interactions and facilitating them across marketing, selling, and service encounters. The sequence of events that make up a scenario is designed to lead the customer along the path toward achieving the specific business goal that you define. A scenario can last a few moments or extend over weeks or months; it can be relatively simple or have many paths. Using scenarios, you can engage, track and communicate with the customer throughout their purchase decision process.

Automated personalization

You are likely familiar with recommendation engines (sometimes called collaborative filtering). A number of large online megastores are famous for this technique — “people who bought this item also bought these items.” The question is, where do those recommendations come from? A common frustration with some of these engines results from purchases made as gifts. If you buy a children’s book for your nephew’s birthday, you may receive offers for similar products from then on.

There is a better approach. Automated recommendations ought to be personalized and driven by more than product purchase affinities. Recommendations should be driven by all the relevant data you have including who the user is, what she is currently doing on your site, what Web site she came from, click history, purchase history, merchandising strategy, and literally billions of other possible data points. The most sophisticated approach available today is based on statistical relational learning and is only available in ATG Recommendations (formerly CleverSet).

How to Get Started

To get you started, we've boiled the creation of an initial personalization strategy into a three-step process.

Step One: Develop your customer segments and define business goals for each segment

Defining segments begins with understanding customers' demographics, psychographics, purchase patterns, knowledge of which channel they use, as well as the value associated with their importance to your business; however, segments can be greatly enhanced by infusing additional information based on a customer's motivations and needs (such as customer buys for a family, customer is a novice in a given field, customer tends to be price conscious). And it's a lot easier than it sounds. Creating enhanced segments doesn't require you to get every customer to login and fill out a profile. Remember, the information you need to create your segments can be captured even without the customer's active participation. And once you have those segments, you have the foundation in place for a rich personalization strategy.

Once you have your segments in place, you then need to have clear goals for each one. Knowing what your business goals are for each segment is critical to making sure you drive the desired customer experience necessary to achieve those goals. To be effective, you need to determine the precise business drivers for each segment. Are you looking to close the first sale? Increase purchase frequency? Increase their average order amount? Decrease the cost of each transaction? Improve your site's ease of use? For some of your "softer" goals, you need to determine the hard metrics against which to measure those goals. For example, improving your sites ease of use could be measured by such factors as decreased site abandonment, increased page views, increased product views, and so on.

Step Two: Develop your personalized content for each segment

With segments in place and goals now clear, the next step is choreographing the "scenarios" that will drive your customers towards those goals. The sequence of events that make up a scenario is designed to lead the customer along the path toward achieving the specific business goal you defined. The scenarios you create should take into account how you can best support your brand. For instance, does your brand call for an overt or understated approach? Do you want to make it obvious to customers that you are influencing their experience, or is a more inferred, subtle method more in keeping with your brand? With target goals defined and your brand rules taken into consideration, you can begin designing scenarios that will actually deliver this personal customer experience. Your Web site content can be dynamically tailored for your visitor in an instant, as soon as it identifies which segment to associate with the visitor. Your e-mail promotions can be delivered to match the product areas that the visitor has shown an interest in. Or the promotions can be timed to coincide with specific user actions and needs.

Step Three: Implement, Measure, and Evolve

With your strategy defined, you are now ready to put personalization into action. Start by mapping your segments to your Web profiles, and ensuring that you are tracking and using key attributes and data to measure your progress against goals. Then watch the results. The only way to know if your personalization is succeeding is to measure. Take the time to ensure that your business goals are tracked and analyzed. If a particular set of scenarios is working with a given segment, figure out how you can up the ante to capture even more of that customer segment's mindshare and wallet. If another set of scenarios is not working, dig into where the strategy is breaking down. Is your home page personalization leading to increased "clicks"? If not, consider re-arranging the page or changing your offers. Are your e-mail promotions leading to increased conversions? If not, test your offers and see what it will take to convert that customer segment. Keep in mind that personalization is an iterative process that evolves as you build an ongoing partnership with your customers.

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