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How Personalization Helps You Compete with Big Retail

Richard Sutherland
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August 27, 2019
Personalization
Personalización

How can your small store hope to compete with the mammoth juggernauts that already dominate the online landscape?

Competing with the big guy is something that small retailers have been wrestling with for centuries, particularly after supermarkets, hypermarkets, and discount stores exploded in popularity and ubiquity in the sixties. At the start of the 1960s, for example, Britain had less than 600 supermarkets. Nine years later, it had over 3,400. Now it has over 10,000.

Hypermarkets are characterized by competitive pricing and product variety. By buying and selling in bulk, these large wholesale suppliers could offer much lower pricing than the traditional corner store. Though people often lament the closure of the traditional high street store, the ultra-low pricing and convenient all in one place shopping is too much of a draw for most consumers.

In e-commerce, the battle between small retailers also exists. In fact, massive online stores like Amazon can offer an even wider range of goods than physical hypermarkets like Wal-Mart ever can. It’s also much easier for consumers to browse and compare the various products from multiple brands all on one website.

Today, big online stores like Amazon still rule the roost. Last year, over 44% of US e-commerce sales were on Amazon.com. Now, when you have a new product to market, one of the decisions to make is whether to get into bed with Amazon and sell your product through their platform or attempt to go your own way and sell your products directly. 

Certainly, selling your products on your own will give you much more control over the branding, pricing, customer service, and individuality of your products and services. On the other hand, considering the size and scope of retailers like Amazon, how can you hope to compete? As we shall see, personalization plays a big part in your online store’s success.

Big Retail Isn’t Very Personalized

Photo by mauro mora on Unsplash

While sites like Amazon may have been innovators at the end of the last century, not much changes in big retail on a year-to-year basis. Amazon, for example, was the brand that popularized the now ubiquitous “others who bought this also bought this” feature. However, it doesn’t particularly care about what you buy, or who you are, or why you’re buying the product — it just wants you to make the purchase through the Amazon platform.

Because of the fragmented nature of the products that are sold and the incredibly diverse customer base, big retailers like Amazon have to stick to a one size fits all solution. Though product pages offer related items and occasional upsells and cross-sells, the overall interface and user experience are identical for everyone.

It is also the case with email communication, social media interaction, and digital ads. Big retail is so big that it has to remain within its branding and act accordingly; whether the reader is a baseball fan, a dog owner, or an art critic, the communication and branding will remain constant.

Because of this, few people feel emotionally invested in brands like Amazon or Wal-Mart. Amazon is not for them personally — it’s for everyone. And this is where smaller stores can compete.

Smart Competitors Are Drawing Sales Away from Big Retail

With the use of unique branding, loyalty programs, and good on-boarding, other online stores are poaching customers from big retail. When a brand focuses on the particular customers they have, they can more accurately engage with them and build loyalty that big retail will never touch. 

A brand that offers compelling stories, useful content, and helps solves customers’ problems can become a friend, and buying from this brand to support it makes the customer feel part of the story. They’re invested in the brand, and part of their own identity is shaped by choosing to buy from this particular store that speaks to their style and values.

TOMS Shoes has been a big success thanks to a strong 'One for One' brand story that customers feel motivated to become a part of.

Becoming the Community for Your Niche

There can be success in becoming the go-to site for your particular niche, with a community behind it that you support. Whatever you’re looking to sell, you can narrow your niche enough to become the no. 1 website online to go to for that niche. When you’re the absolute authority and a fun, welcoming place for people to discuss their interest in the topic, you can gradually branch out and expand into broader or more competitive markets.

Lego Ideas offers a great community for people to network, get ideas, and feel recognition, all based around the core product.

This is working well for many e-commerce stores as big retail has been suffering from a spate of paid reviews. People trust reviews they read on big online retail stores less than they used to, so building a community of real users and enthusiasts for your products can be a goldmine for perceived authenticity.

Offering Something Big Retail Can’t

Big online retail is essentially a massive delivery service. You can read a little about a product, see some reviews, and get the product delivered to your door.

Where you begin to win against big retail is identifying the places where you do more than this. 

Best Buy, for example, performs better than Amazon for online TV sales because it offers an installation and configuration service. 

Sephora, the French personal care and beauty store chain, ties its digital communication to in-store offers and consultations, encouraging the reader to physically explore the products on offer.

Your business should be doing things for your customers that Amazon and big retail can’t do due to scaling. Identify what these things are and make them the center of your value proposition to the customer. It then becomes easy for the reader to see why they should buy direct from you instead of going through a big retailer like Amazon.

Sephora highlights its in-store events to promote its strengths as a high street retailer.

A Dynamically Shifting Site

Brands like ASOS that have embraced agile website personalization have had great success in modernizing the online marketplace. It’s the same force you can add to your website with Datacue’s advanced personalization tools, offering a different experience to every customer.

People want to feel like the site is for them before they buy. We can do this by showing them details based on what we know about them and their previous interactions and avoid the clutter they’re not going to be interested in. 

Every time we show them something they’re interested in, we’re closer to being the brand they want. Every time we show them something that doesn’t suit their interests, it distances us from them and makes them consider whether we’re really the solution to their problem.

The user interface of your site needs to be easy to use and understand. What it doesn’t need to be is rigid. A dynamic interface will change based on the pages of the site the visitor has browsed before.

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ASOS remembers whether you last viewed men’s or women’s apparel and uses this to show you the right page next time you visit.

A simple example is when a user visits your site and browses men’s items instead of women’s items. Our system makes a note of this and will posit that they’re generally interested in men’s items more than women’s items. The next time they visit, the interface highlights men’s items or simply whisks them to men’s items directly, skipping a whole step in the buying process.

By skipping this step, your product offerings appear to be more particularly suitable to the visitor. It’s entirely seamless, and they’re unaware that other people will be offered different items and a different experience when they visit.

Do you have different audiences who would respond to different versions of your site and brand?

No Mess, No Clutter

One of the prime reasons people cite for not going through with an online purchase is getting lost in the wealth of choice. This is another major weakness of big retail stores online. In a rush to sell everything under the sun, they offer everything, and the user is greeted with too many options and too many distractions. 

They came for an electric mower; now there are 500 mowers to choose from 50 different brands…any maybe they don’t want to buy a mower anyway since there’s a sale on Game of Thrones Blu-Rays…oh this is all too tiring…

Smaller retailers can zero in on the few products that their particular niche of customer will want. This reduces choice paralysis. But we can go even further with smart personalization, only showing the customer the products that we know they’re likely to be interested in.

Getting to Know Your Visitors and Customers

Photo by Campaign Creators on Unsplash

As you collect more and more useful data on each of your visitors, you essentially get to know them and what they respond to. 

If they’re a new visitor, you can begin to piece a virtual picture of who they are from how they got to your site. 

  • Did they perform a specific web browser search? 
  • Where are they physically in the world?
  • Did they come from a link in an article that’s trending?
  • Did they respond to a social media post with a particular tag? 

All of these things can give you a good starting point to profile who this person is and what they might be most interested in. As they browse your site, your software should be recording all of the important things they do. 

  • What did they search for? 
  • Which products did they click through on? 
  • Did they show interest in detailed specifications?
  • Did they view specific videos?
  • Did they browse through images?
  • Did they add something to their cart?

We would do the same thing in a brick-and-mortar store; size up the customer and make assumptions on how we can help them. As they give us more information, we guide them even more. 

Our initial assumptions may occasionally be wrong, so our virtual model should be able to adapt and change in the future. For example, someone may visit our online clothing store and search for items for their opposite-sex partner, later deciding to view clothing for themselves. Our personalization model must adapt.

After they’ve offered us their email address, and after they’ve purchased something, we can begin to build much more detailed profiles of our customers.

  • Did they purchase items when they were on sale?
  • Did they buy products that were cross-sold or up-sold?
  • Did they choose items that were expensive but considered worth the premium?
  • Do they respond to particular types of newsletters or social media posts?

A smart personalization system will store each of these metrics and tag users based on their previous interactions. People are all different so there’s not always a black-and-white answer to some of the metrics you want to store. It, therefore, pays to store these metrics as a percentage likelihood rather than a straight yes-or-no answer. Your smart personalization system should handle all of this under the surface with limited interaction on your part.

Making the Personal Experience

Shoeline's user interface changes based on what you interacted with most on your previous visits.

Now we know all of these things about the visitor, we can use them to give them the mom-and-pop online store experience they want. 

Big Retail might send a customer an email once in a while advising about a generic sales event. 

Our personalized store, instead, can send them a personalized email that mentions the products they’ve bought before and how some new products we’ve got might be a good complement. 

As we know they’ve been motivated by sales in the past, we can offer them a personalized sales price to thank them for their prior purchases and loyalty. 

We know they’ve never looked at expensive products so we don’t bother mentioning them, but they do like to view videos and images so we add these prominently. 

We already know their payment details and where they’re located, so the fees and shipping costs can be hidden in the final price. 

When they click through, there’s live chat available from an operator who has a wealth of knowledge about the customer’s prior engagement with the company.

And the list goes on and on. Once you embrace agile website personalization and make it the center of your online business, you can offer a service above and beyond that which big retail can, taking the smaller nature of your business and turning it into a great asset.

(Cover Photo by Alexandre Godreau on Unsplash.)

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About the author

Richard Sutherland has worked in online marketing and search engine optimization for over 15 years. Excited about how we can offer the customer a streamlined, personalized online experience, Richard looks for every way to increase conversion percentages with a high return on investment.

Sobre el autor

Richard Sutherland tiene más de 15 años de experiencia en marketing online y optimización de motores de búsqueda. Apasionado por ofrecer una experiencia inteligente y personalizada a cada consumidor, Richard está constantemente buscando nuevas maneras de incrementar la conversión y, con ella, los retornos a la inversión.

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