In the fourth episode, we saw how companies like Zalando and ASOS are leveraging hyper-personalization in the fashion industry, a sector where purchases are often impulsive and made in a matter of seconds. But not all purchases are the same. Some are planned, considered, and represent a genuine investment.
This is the case with thoughtful purchases, which we explore in this fifth episode, using the example of home furnishings and DIY. Furnishing your home online means proceeding without a salesperson to advise you, without being able to see or touch the product to assess its proportions, materials, or compatibility with your project. Hyper-personalization must therefore support the customer on two fronts: identifying their tastes to present products in the settings and collections that suit them, and then taking into account the specific constraints of their home to help them compare and choose.
A considered purchase is often a “mini-event” in the consumer’s life. It usually takes place around once every one to three years. This means it is a rare purchase and one which often represents an investment.
It’s therefore important to use hyper-personalisation in order to help the customer in the product selection and buying process for their project. Let’s take the example of the household goods sector.
This sector has seen significant growth as a result of the COVID 19 pandemic. Customers were stuck in their homes, unable to go on holiday or go out. Home improvement budgets therefore increased. Furthermore, shops were closed and consumers moved towards buying online. This is one habit which is likely to continue: a 35.8% increase in online sales was observed in June 2020 and this trend is being reaffirmed in 2021 with a 5% increase in sales expected over the year.*
However, there can be many barriers to making an investment in home furnishings on the internet. It’s impossible to physically speak to a salesperson and you can’t see or touch the product to work out its proportions, material or whether it fits with your plans.
Taking a customer along the selection and buying process with hyper-personalisation needs to be split into several stages :
Knowing the customer’s tastes in terms of style so that you can present them with all available options for their project, putting forward the styles and collections which will work for them.
Taking into account the constraints of each customer’s home and allowing them to see comparisons in order to make their choice.
Let’s detail the methods shown using different examples.
Lots of customers visit your website to buy the products they need, but also to find ideas that correspond to their taste.
They often come with a project in mind, such as wanting to rede - corate a bathroom or replace a sofa, but they are often in search of an overall style that they like and want to put into their home.
It’s therefore important to work out quickly what each customer likes in terms of individual style for their project. The purchasing journey can be hyper-personalised according to their taste in order to offer the products that the customer is most likely to buy, even with product catalogues that are often large and technical.
Let’s take the example of Wayfair, a pure player and major online retailer of home furnishings.
As you can see in our example, with Wayfair you can (in the same way as with Pinterest) browse and choose pho - tographs of rooms according to decorative styles, adding the ones you like best to your favou - rites. You can also browse and buy products that are on display on the “Room ideas” page.
Next, the styles that have been viewed and ‘liked’ by each customer are analysed, preferences are detected and results lists, product sugges - tions and user search results are configured in real time.
Wayfair measures the success of its personalisations during the buying journey by the num - ber of “repeat customers” and the number of orders per cus - tomer. This seems to be paying off. These two KPIs are increa - sing year on year, with a steady increase of 55% in the number of orders per customer.
From style detection with Wayfair’s “RoomIdea” to analyzing “liked” atmospheres to adjust rankings in real time, we see just how hyper-personalization can transform a long, technical journey into a seamless and inspiring experience—to the point of making it a measurable driver of loyalty, as evidenced by the 55% year-over-year increase in orders per customer observed at Wayfair.
So far, we’ve illustrated hyper-personalization through specific industries and use cases. In the next episode, we’ll take a step back to understand how we got here: from the “one-size-fits-all” approach of early retailers to today’s “one-to-one” model, tracing the evolution of customer segmentation. Join us in Episode 6 to discover this story, from Coca-Cola to the real-time personalization of customer journeys.
Source : the Institute of Forecasting and Studies on the Furniture trade
Photo credit : ©Shutters