Hyper-Personalization in Ecommerce: Definition, Importance & Best Practices for 2023

Alex Danchenko

We are aware of the personalized experiences that come while browsing the Internet. Whether it is a clothing e-shop remembering and recommending items according to your previous searches or an email explicitly addressed to you from a store, these practice has become common in the world of e-commerce.

So what if we tell you there's a level of personalization beyond this? An experience in which your interests and desires aren't just catered to, but done before you even start thinking about them yourself. That's not some far-out concept – that's a fact of the present reality today called hyper-personalization. And in this article, we're going deep into this advanced approach that's changing the landscape of e-commerce right now, taking personalization to new levels yet again. So, what is hyper-personalization?

What is Hyper-Personalization?

Consider hyper-personalization as an enhanced version of a traditional one. It doesn’t only include demographics and behavior in its customization – it actually knows what your customers want and prefer. This way, you'll create content that directly speaks to each customer, thereby making your messages and campaigns more targeted, relevant, and effective. It also contributes to a deep segmentation that breaks customers down into different categories with more precision.

Watch hyper-personalization at work. Say, you are a fitness marketer using a hyper-personalization approach. For example, if a client wants to lose weight, the newsletter she'd get would be of tips on nutrition, workout routines, and success stories of people who have actually reached their goals. The same goes for someone focused on muscle bulking or improving flexibility. Every newsletter is carefully crafted with regard to the needs of the client as well as their interests. 

Personalization vs Hyper-Personalization: What’s the Difference?

Personalization and hyper personalization are similar in the way they provide custom experiences. But, the primary difference between them is in how deeply they use data. Personalization utilizes basic data such as names and past purchase history for somewhat customized experiences, such as sending personalized emails or suggesting items based on past purchases.

Hyper-personalization takes things a step further by utilizing advanced data analytics and AI. It uses real-time data along with behavior analysis to provide highly individualized experiences. For instance, it analyzes your browsing behavior, and past purchasing history alongside social media interactions to suggest products or services that you probably least expect. Not only that, but it also predicts, what you might want shortly.

In simple terms, if personalization is like walking into your local store and being welcomed by name, hyper-personalization is like knowing what kind of taste you have so well that right after walking in, the preferred items are already waiting for you. 

Why Hyper-Personalization is a Must for Ecommerce?

The benefits of hyper-personalization are abundant. We will bring forward some of them.

Enhanced Customer Engagement

The more a customer feels seen and recognized, the more likely they will engage with the brand. E-commerce businesses that personalize their experiences for customers get engaged clients in return because they take action based on a customer’s interactions with their brand, leading to a personalized customer experience that is difficult to copy by others.

Increased Conversion Rates

Hyper-personalization has been linked to increased conversion. Personalized experiences make any customer feel understood and in return, they are more likely to buy from the respective e-commerce business. A customer that gets triggered by an instant suggestion of the food they mentioned while talking is more likely to click through than those who have recently bought some. This principle applies to all channels of e-commerce including emails, paid ads, and websites.

Boosted Customer Loyalty

If you “guess” your customer’s desires most of the time, they will stay. E-commerce businesses that go for customization in their marketing tend to have a better retention rate in relation to those without. Hyper-personalization is both an optimization and retention tool, as it helps boost conversions and bring clients back.

Reduced Cart Abandonment

It has always been difficult to grasp why customers abandon their carts. However, hyper-personalization offers a few solutions to the issue. With automated abandoned cart emails and personalized campaigns that remind customers of their abandoned carts with messaging directly addressing the user’s reasons for leaving, e-commerce businesses can help potential customers retain an interest in items they left in their cart. 

Data-Driven Marketing Insights

Hyper-personalization creates e-commerce businesses capable of accessing data-driven insights that can be used for future marketing campaigns. By constantly analyzing data, e-commerce businesses will gain valuable insights into their customers’ behaviors, preferences, and needs which can help them formulate more successful campaigns as well as increased customization options for the customers. 

Competitive Edge

Lastly, hyper-personalization is the ace up your sleeve. E-commerce businesses may offer their customers services that their counterparts haven't provided, through unique shopping experiences, personalized product recommendations, and exclusive deals. This unique, customized experience is what makes the business stand out from others. Aside from this, high-quality service makes the customers feel confident to come back for more shopping and recommend the business with good word of mouth.

10 Hyper-Personalization Best Practices for 2023

As the notion is not overly popularized yet in 2023, it’s the perfect time to join the trend. These hyper-personalization examples will show you where to start.

Create Adaptive Content

The term adaptive content refers to repurposing and reusing the same piece of content while keeping the core message intact. 

One example is the e-learning platform Udemy. It tailors its course suggestions to different learners. Particularly, it repurposes existing materials based on users' learning styles, skill levels, and interests. This approach saves them time and money.

Udemy course suggestions

Invest in Predictive Analytics and Machine Learning

Predictive analytics along with machine learning help predict behaviour and preferences by customers appropriately. 

Zara, for instance, employs predictive analytics to anticipate customer preferences. By analyzing previous purchases and browsing behavior, the company suggests outfit ensembles and accessories that align with each shopper's unique fashion taste.

Zara email recommendations

Do Real-Time Behavioral Tracking

Real-time behavior tracking involves the observation of customer behavior on a website or application. 

Tinder, a dating application, does real-time behavioral tracking, proposing personalized match recommendations. It suggests potential matches upon analyzing users' swiping behavior and interests.

Develop Dynamic Email Campaigns

Dynamic email campaigns continuously alter their emails based on each user's behavior, past buying history as well as preferences.

A perfect example of a company that uses such an approach is Booking.com. They send dynamic email campaigns based on the user’s search history. As soon as a user searches for certain destinations, Booking.com sends emails with coupon stacks for those locations.

Prioritize Mobile-First Marketing Tactics

Today, mobile devices form a large volume of web traffic; hence, you cannot ignore them. Hyper-personalized marketing is based on the needs and behaviors of a mobile user; thus, you can construct campaigns that shall be least effective for such an audience. 

Starbucks stands out when it comes to mobile-first marketing through personalized offers on its mobile app. Participants get rewards and discounts tailored according to their past orders and preferences. 

Make Use of AI-Driven Personalization Tools

Artificial intelligence and machine learning enable marketers to process huge volumes of data and automate procedures of personalization, too. These tools allow you to reduce the time and resources needed to run a successful campaign so that small businesses can be efficient in targeting as well as converting lots of leads.

Spartan Race, an obstacle race company, uses AI-driven personalization tools that track participants’ fitness levels and race history, suggesting upcoming races and training plans.

Deploy Location-Based Marketing

Geotargeting can advise users of products or services in their local area, which can attract bypassing and local customers alike.

The food delivery app Uber Eats uses location-based notifications as a means of promoting food delivery. Users get personalized offers when they are in areas covered by the service.

Offer In-Store Product Recommendations

In-store product recommendations are an established technique for offering customized experiences to shoppers. 

Through digital displays, sportswear retailer Lululemon offers its customers in-store product recommendations. When customers work out, the store proposes them activewear items. 

Lululemon in-store recommendations

Run Omnichannel Targeted Adds

Omnichannel customer service is about your users getting a constant experience across all the channels. 

Here is how Warby Parker runs omnichannel targeted ads. They give users personalized recommendations containing eyeglass styles that complement their face shape and likes.

Warby Parker personalized recommendations

Use Automated Campaigns and Triggered Messages

Automated campaigns and in-app messages find personal touchpoints with the customer during the entire course of the customer journey.

Look how it works with Etsy. Whenever people like or add items to their shopping carts, Etsy sends out automated messages with personalized product recommendations as well as seller discounts.

How NOT to Use Hyper-Personalization: Common Mistakes

Neglecting Privacy Concerns

When you collect data from customers be careful not to get carried away. Now that personalization is a common thing, it is easy to violate personal privacy. Make it clear what data you're collecting and why, and give customers the option to choose cookies themselves. Make sure you're following all relevant privacy laws and guidelines, such as GDPR or CCPA. 

Rigid Assumptions About Preferences

One mistake many marketers make with hyper-personalization is assuming that customers fit neatly into certain categories. For instance, just because a customer is a woman doesn't imply she likes beauty products. These stereotype-based assumptions can be far from the truth, since everyone is different. Instead, gather data on individual customers to create customized experiences that resonate with them.

Lack of Human Touch

Even if hyper-personalization may incorporate AI to make product recommendations for websites, it's important not to completely kill the human element in your communication. Make sure your messaging and interactions with customers still come across as genuine and authentic, rather than overly automated. All customers want to feel like they're interacting with a real person, not a robot.

Excessive Frequency of Communication

Another trap businesses fall for is bombarding customers with too many messages. Having a lot of data is great, but won’t help as long as you use it all at once. Instead, dose the data to personalize your messaging on the channels and at the times that are most convenient for them. Be thoughtful about the frequency of communication, and don't overwhelm customers with notifications.

Off-Putting Personalization

Finally, remember that not all forms of personalization are good — or even perfect. If your messaging or recommendations seem creepy or too intrusive, customers might be turned off and withdraw from you. There must be a vivid line that you don’t want to cross in your customer-brand relationship.

How to Improve Mobile App Personalization with Reteno

If you're looking to upgrade your mobile app personalization, Reteno is the way to go. With Reteno you can send personalized mobile push notifications, in-app, app inboxes, email, and SMS messages that serve particularly their needs. Our highly experienced team thinks exactly like your target audience and helps you win the competition with the most advanced personalization tools. Contact us today for a more detailed strategy!

Final Thoughts

Personalization has some presence in day-to-day life, but the potential of hyper-personalization in retail appears just beginning to be tapped by the marketing world. Incorporating such advanced technologies into an organization’s loot proved to be an effective way of doing behavioral segmentation. Even in competitive-industry organizations, this has become a no-brainer decision; hop on board and don’t be left behind! 

Alex Danchenko

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July 1, 2023

Vladyslav Pobyva

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August 30, 2022

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