What’s next for personalization in digital commerce?

Alexandre Robicquet is co-founder and CEO of cross thoughtsan intelligent AI-powered recommendation platform for e-commerce and content.

When it comes to personalization, more and more customers expect companies to understand and anticipate their needs. In fact, 73% of customers (download required) expected this in 2022, compared to 66% of customers in 2020.

However, many companies struggle to keep up with these demands. Businesses know they should invest in personalization strategies that provide customers with an ultra-tailored shopping experience, but many believe the most effective way to achieve this is to “get to know” their customers through personally identifiable information (PII).

This is a slippery slope that often leads to assumptions about what a customer might be interested in based on demographics. Do you really consider it true personalization when you receive the same product recommendations as everyone in your age group, gender or location?

Fortunately, not all personalization strategies are created equal, and many companies have already begun to question traditional approaches to personalization. As companies execute on their strategies for 2023, here are my predictions for what this year will bring.

Online businesses are opting for first-party data.

This year will be the year that organizations increasingly move away from using third-party data for their personalization efforts. Using third-party data for personalization is the norm for many online retailers, but it’s not effective. Because it’s typically a collection of stereotypes based on aggregated data, it doesn’t take into account each customer’s precise tastes, interests, or reason for purchasing the product. That doesn’t even touch on the privacy concerns associated with using these intrusive data-tracking strategies.

Instead, I believe companies will focus on data gleaned from real-time consumer behavior, e.g. B. which products they click on and how much time they spend on each item. This will help them better understand the context of each visit and each individual’s likes and interests, giving them a better feel for the products they are looking for.

Businesses are already getting started: In 2022, 37% of brands said they only use first-party data to personalize customer experiences, up 6% from 2021, and that number should continue to rise.

Companies will shy away from “one-size-fits-all” solutions.

Businesses have many options to choose from when it comes to how they deliver personalized experiences to their customers. “Out-of-the-box” or “plug-and-play” recommendation engines are popular options because businesses can quickly implement these solutions on their websites without any additional work on their end.

While this may be the easy way, companies often don’t see the ROI they want because these solutions don’t address their unique business goals and needs. No two companies are exactly alike, nor do people browse the items in their online catalogs. So why would they use the same solution for a variety of use cases? It’s ironic that the technology that drives personalization is often not personalized for the companies that use it.

This year, we’ll see them make more informed decisions about how they offer bespoke personalization to their customers. On the surface, a more conscious approach might seem like more work, requiring additional resources and budget. But if businesses are looking for tools to help them achieve their conversion, brand loyalty, and customer retention goals, they’ll likely find it’s a worthwhile investment as their customers will have experiences that will drive them there to keep coming back.

Retailers will prioritize targeting younger shoppers.

Right now, Gen-Z has strong purchasing power. This generation has complex needs compared to previous generations.

You want high quality products. You are value-oriented and budget-conscious. They expect a consistent, connected experience across all channels and platforms. They want product recommendations that take all of this into account.

However, many companies do not recognize these expectations and do not give them what they want in return. To effectively deliver personalized online experiences to Gen Z shoppers, businesses must take an omnichannel approach to personalization.

This generation still expects personalized experiences when navigating a retailer’s website, but the personalization shouldn’t end once they close the tab. This means businesses need to create additional touchpoints beyond their websites (e.g. follow-up emails or text reminders to return to their digital shopping carts). Not only does this increase the chances of sales conversions, but this improved customer experience can also lead to increased brand loyalty and returning customers.

Personalization will transform new industries.

Personalization in e-commerce and streaming is nothing new. Consumers have become accustomed to personalized Netflix recommendations based on what they’ve already watched or carousels of what you might like while shopping for new clothes. If technology can deliver taste-based recommendations in certain industries, who says it can’t in others?

This year, we’ll see ultra-tailored recommendations become commonplace in other taste-based industries, including art, events, and even grocery. Choosing a new piece of art, how to spend your weekend, or what to cook for dinner are subjective processes based solely on a person’s unique tastes and often require a great deal of time, thought, and consideration. By using the right technology, online art dealers, event organizers and food retailers can quickly provide relevant and accurate recommendations, which can save these potential customers time and stress.


There will always be new personalization trends that online businesses should consider. From prioritizing first-party data to aligning personalization strategies with business goals, we’re sure organizations will drive the personalization needle forward in the year and years to come.

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