Personalisation, an uprising factor in the digital shopping age, that has been giving worldwide consumers mixed opinions on whether they want a tailored online experience or to stay anonymous and have a generic experience.
Online personalisation services are viewed as special goods rather than being perceived as information goods (Wattal et al., 2009) this is due to personalisation services are usually offered free of charge from online firms.
From a customer perspective, personalisation services offered to customers can effectively reduce information overload and quickly capture personalized demands, which drastically increases customer satisfaction. From the perspective of online complementary firms, personalisation services can be used to acquire customer preference information to conduct targeted advertising and price discrimination (Chellappa and Shivendu 2007).
So why do leading brands do this on their website/App?
Leading brands are using personalisation from Facebook, Spotify to Amazon (Whittaker, 2011). In a retail sense, through Amazon, for example, you are presented with a landing (Home Page) page full of offers based on the previous history, completely tailored to you. This, therefore helps the brand to do something called “Conversion”. Conversion marketing is the phrase used to often describe the act of converting a customer who browses your site to a paying customer (Beal, 2018). Personalisation is a positive attribute in this example, due to it putting a product in front of you that you may not have previously thought about but because Amazon has tailored that content to you, you are now much more likely to go ahead and purchase straight away, rather than continue looking.
Strengths of using Personalisation (How companies use this)
The main strengths within the use of personalisation in digital marketing especially can be split into these three categories:
- Upkeep of customer loyalty.
- Providing the best deals – Personalisation helps to find the best, most relevant deals for the customer in particular, which encourages them to convert, as they do not have to hunt for the deal suited to them (Al-Natour, S. et al, 2009).
- Landing pages.
- Build Relationships – Over time, personalisation allows you to make the relationship with your customers more intimate as the relationship matures, and you gather more data on habits and preferences. Business to Consumer and Business to Business relationships differ, but rewards for individuals can still bring a past relationship closer, and create new ones (Verhagen, T.,et al. 2014).
Below is an example video of how Missguided.com own app enables relationships with their clients through the use of creating a ‘Swipe to like’ system. This then permits the customer to have a hands-on experience and be able to physically and quickly show which products they would like to update their ‘wishlist’ for.
(www.Missguided.com, 2019)
Overall, the value of the transaction will be determined by the quality of the experience or the transaction, personalisation in this format can be an attribute to the company app and online front. This platform can be easily trackable on a large scale on what products the customer is most interested in. this can further tailor the company/brands future product/service development to a more richer quality and time frame (Clandfield, L. 2017).
Weakness’s of using Personalisation (How companies have not complied)
Although there are benefits of personalization, there are also some drawbacks to be named. Companies with personalized content usually have higher costs. It costs time and money to prepare content that would appeal to different segments. Instead of buying the typical banners, companies now have to spend money on tools and pay for different content and ads (Chang, M.K., et al, 2013).
Some of the involved costs:
- resources to map out the trigger-effect dimensions for personalization, monitor and optimize the performance;
- software and tools to collect, analyze and automate personalization factors;
- custom (more) creative and landing pages. (Zhu, H., Kock, A., et al, 2019)
On the side of the consumer, the technology does not work 100%. With the use of search history and cookies, there may be some failings that users find frustrating. For example, a student is searching for information about the French revolution, but he is personally interested in African history. He now gets Amazon recommendations on French revolution even though he has no longer any interest in the topic. This is just an example of how personalization may go wrong in some cases.
The Concern
The concerns on personalized content come mostly from users, where they raise privacy issues as a problem of web personalization. They feel they are being tracked, followed and watched to be sold something. Websites have responded with an opt-out option, but it can only be accessed only if asked for (Heo, H.,et al. 2010). There is a lot of debate on web personalization and some of the privacy issues all around the world.
In 2018, Europe is also applying a new GDPR regulation, calling for much more specific consent requests when collecting personal data. With the arrival of the new legislation, double opt-in will become essential if you want to start or continue your personalisation effort in 2018 (Claire, L. & John, D. 2018).
Useful Tips on how to get the best Personal experience online
The video below provides a further and insightful amount of knowledge on how to understand e-commerce personalisation and how it is now becoming a more generic aspect to our online experience.
(YouTube, 2018)
Dont forget to follow my twitter account on the top of this blog to recieve further insighting details on digital marketing!!
References
Al-Natour, S. and Benbasat, I., 2009. The adoption and use of IT artifacts: A new interaction-centric model for the study of user-artifact relationships. Journal of the Association for Information Systems, 10(9), p.2.
Beal, V. (2018). What is Conversion Marketing? Webopedia Definition. [online] Webopedia.com. Available at: https://www.webopedia.com/TERM/C/conversion_marketing.html [Accessed 17 Feb. 2019].
Chang, M.K., Cheung, W. & Tang, M. 2013, “Building trust online: Interactions among trust building mechanisms”, Information & Management, vol. 50, no. 7, pp. 439-445.
Chellappa, R.K. and Shivendu, S., 2007. An economic model of privacy: A property rights approach to regulatory choices for online personalization. Journal of Management Information Systems, 24(3), pp.193-225.
Claire, L. & John, D. 2018, “GDPR”, Business Information Review, vol. 35, no. 2, pp. 81-83
Clandfield, L. 2017, Interaction online, Cambridge University Press, Cambridge University Press.
Clark, J.L. & Green, M.C. 2018, “Self-fulfilling prophecies: Perceived reality of online interaction drives expected outcomes of online communication”, Personality and Individual Differences, vol. 133, pp. 73-76.
GOV, (2018). [online] Available at: https://www.gov.uk/government/publications/guide-to-the-general-data-protection-regulation [Accessed 17 Feb. 2019].
Heo, H., Lim, K.Y. & Kim, Y. 2010, “Exploratory study on the patterns of online interaction and knowledge co-construction in project-based learning”, Computers & Education, vol. 55, no. 3, pp. 1383-1392.
Missguided.co.uk. (2019). Women’s Clothes | Fashion Shopping Online – Missguided. [online] Available at: https://www.missguided.co.uk/ [Accessed 17 Feb. 2019].
Verhagen, T., van Nes, J., Feldberg, F. & van Dolen, W. 2014, “Virtual customer service agents: using social presence and personalization to shape online service encounters”, Journal of Computer-Mediated Communication, vol. 19, no. 3, pp. 529-545.
Wattal, S., Telang, R. and Mukhopadhyay, T., 2009. Information personalization in a two-dimensional product differentiation model. Journal of Management Information Systems, 26(2), pp.69-95.
Whittaker, Z. (2011). Facebook instant personalization: How to disable it, and why | ZDNet. [online] ZDNet. Available at: https://www.zdnet.com/article/facebook-instant-personalization-how-to-disable-it-and-why/ [Accessed 17 Feb. 2019].
YouTube. (2018). The Era of E-Commerce Personalisation. [online] Available at: https://www.youtube.com/watch?v=X3bl0FJE-e0 [Accessed 17 Feb. 2019].
Zhu, H., Kock, A., Wentker, M. & Leker, J. 2019, “How Does Online Interaction Affect Idea Quality? The Effect of Feedback in Firm‐Internal Idea Competitions”, Journal of Product Innovation Management, vol. 36, no. 1, pp. 24-40.
