UK retailers could be missing out on as much as 66 million pounds in additional revenue through failing to personalise the experience they offer online shoppers, according to new research from Webloyalty.
The figure of additional revenue has been calculated on an average-sized retailer generating a turnover of 850 million pounds; it states that personalisation could deliver a 7.8 percent uplift in sales, which translates to an annual uplift of 66 million pounds, a figure which would be significantly higher for larger companies.
The research, undertaken by Conlumino, found that over half (55.8 percent) of UK consumers said that they would make more of an effort to use a retailer if it offered a good personalised experience, and nearly 40 percent of UK online shoppers stated that they would be more influenced to make a purchase if there was a personal element.
However, ‘The Connected Consumer’ report also found that one in four consumers said that they have never seen a personalised deal, showing that retailers need to consider both in-store and online personalisation, including in-store technology, tailored deals and online adverts based on consumers’ likes and needs.
The research also noted that over half of UK consumers (51.8 percent) believe that technology will allow the shopping experience to be better tailored to their needs in the future, with a further one in three (30.7 percent) thinking that it will make shopping a more personal experience.
Guy Chiswick, managing director for Webloyalty Northern Europe, said: “Personalisation is the future of online shopping. Retailers need to be aware of the appetite within the consumer community and respond to it, if they are to reap the rewards.
“One retailer taking advantage of online personalisation is Westfield with the ‘My Westfield’ app, which features in the Connected Consumer report. The app creates a shopping profile for each user and then generates offers based on location and preferences.”
As well as assessing the impact of personalisation on consumer behaviour, the research also looked at the effect of online reviews in terms of consumer spending, it revealed that one in three online shoppers base a purchasing decision on recommendations and customer reviews on websites and social media. While two thirds of UK consumers (66.5 percent) said they are at least partially influenced by online reviews, and 65 percent respond to starred ratings on websites.
Chiswick added: “Consumers are clearly influenced by the reviewing process. Retailers need to ensure that they make the most of customer testimonials, particularly as so many reviews tend to be positive.”