Personalization in Retail Industry

Customer Engagement with Personalized Retail Experience

Today, customers are flooded with channels for buying products and brands. The explosion of the internet has allowed customers to access more content about brands. All that content allows them to shop, compare, and buy any kind of product, from mobile devices and electronic gadgets to jewelry, without ever visiting a store. This has led retailers to provide compelling shopping experiences to their target customers to survive in such a competitive market. In this blog post, we’ll look at what personalization means in the retail landscape, the challenges retailers face, and some suggestions for best practices.

What is personalization in retail?

In simple words, personalization in retail is about serving a tailored experience to a customer based on their behavior through the use of product suggestions. Such recommendations should be products customers might not have considered on their own.

Personalization is not only about targeting new customers. It’s about acquiring more business from existing customers and increasing customer retention for the brand.

The following figure illustrates providing personalized product lists to a specific set of customers when they view a retail website or mobile app. Customers are segmented into different buckets and receive specific marketing campaigns tailored to them. Sometimes, personalization goes further to tailor a unique offer for each customer, also known as hyper-customized offers. Consider these offers and how they’re created. Apart from the UI a user sees, there are many actions involved in the background: gathering data, processing it, producing useful metrics, fitting the results into the application-specific to a customer—and the list goes on.

Personalization and Hyper-Personalization in Retail
Personalization and Hyper-Personalization in Retail

Check out this video about Microsoft’s vision for digital retail. The purchase path of a customer starts online, receives assistance via bots, and ends in a brick-and-mortar store.

Some use cases

Let’s see some use cases of personalization in the retail industry.

Out-of-stock recommendations

Normally, an out-of-stock product page is a guaranteed bounce. But the retailer’s goal is always to keep a customer from abandoning the site. Suggesting related products if the desired one is out of stock is one of the ways to prevent a missed opportunity.

Recommendations for Out-of-Stock Products
Recommendations for Out-of-Stock Products

Retarget your customers before they leave

A little extra discount on a relevant product that your user is considering may be exactly what they need to push them through checkout.

Extra Discount to Encourage the Customer to Purchase
Extra Discount to Encourage the Customer to Purchase

Make your posts shoppable

General social media posts are common, but make them so they are easily shoppable. Research shows that more than three-quarters of consumers have bought something they’ve seen on social media.

Social Media Post with Links to Shop for the Items in the Post
Social Media Post with Links to Shop for the Items in the Post

What stops retailers from implementing personalization in their business?

Most surveys and reports like this one show that customers like personalization if retailers provide relevant offers or recommendations. Retailers have also started increasing their efforts to help customers find the right product at the right time. But what keeps retailers from doing this? The answer is data analytics. Data is available via different channels like social media, website usage patterns, weather, geographic locations, news, and more. Even companies with such substantial data about their customers find it difficult to leverage and aggregate all of it. This is why a strong data integration platform is needed for performing ETL processes, and a business intelligence tool is needed to perform analytics. Visualizing cleaned data as dashboards lets retailers make data-driven decisions.

Circling back to personalization challenges, an omnichannel strategy is another tough challenge for retail brands to handle. It’ss about selling both online and at brick-and-mortar locations. Another challenge is to ensure that the right products are available in the right places for the right customers when some stores may have countless products and many brick-and-mortar stores in different locations.

Best practices

According to this survey, 40% of consumers consider some forms of personalized marketing creepy because incorrect assumptions are made about their likes or interests. Following best practices like those listed here lets your customers know how they stand to benefit from those recommendations.

Customers will be more likely to trust you if you leave the control of their data to them

Customers want to control what products will be recommended to them. The following figure shows an interface where a customer can control the number of recommendations they receive. They configure what types of products are recommended, and what occasions the products correlate to.

Recommendation engine configurable by the customer
Recommendation engine configurable by the customer

The power of Pinterest shopping ads

Apart from social media networks like Facebook, Instagram, and Twitter, I would like to point out one important app: Pinterest. Pinterest is a discovery engine that allows pinners to explore and share new interests, ideas, and inspirations. In this application, you can post images and videos about any topic, from kitchen cabinet ideas and apparel to holiday destinations. Retailers should explore how they can use such apps to grow their business.

Applications like Pinterest Can Foster Business Growth
Applications like Pinterest Can Foster Business Growth

List your product with details on your website

The information about the products listed on your website is also very important. Comprehensive information will help customers identify your product on their own while they Google. This best practice applies to SEO as well.

Complete Product Details Available through SEO
Complete Product Details Available through SEO

Respect your customers’ privacy

If your customers do not wish to receive recommendations, then do not serve them. When you respect their privacy, they will keep your products in mind and will come back when they need them.

Privacy Also Matters in Personalization
Privacy Also Matters in Personalization

Further reading

With the cutting-edge tech stack available today from big data, machine learning, BI, and AI, retailers are able to provide high-performance shopping experiences to their consumers. I recommend the following resources for more information on personalization in retail:


With this blog, we can see that personalization is important to meet customers’ demands on their own terms, and digital transformation is driving all areas of business.

If you have any questions, please use the comments section available below. You can also contact us by submitting your questions on the Bold BI contact page, or if you already have an account, you can log in to submit your support question.

If you don’t have a business dashboard yet, we suggest you try our 15-day free trial of Bold BI dashboards—no credit card information required! Bold BI also offers enterprise and embedded dashboard solutions. Read this blog post for more details.

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