How retailers are delivering a personalized holiday shopping experience



The holiday season is always the most important time of the year for retailers, and this year is no exception. Consumer confidence has wavered over the past year because of uncertainties surrounding issues such as the election and Brexit, creating concern that 2016 sales growth would continue on the downward trend that began last year. However, that has not been the case. Sales growth has increased throughout most of the year, including a strong Cyber Monday which has set the pace for the holiday shopping season. Add in the low costs of fuel, decreasing unemployment and moderate wage gains, and the retail industry is poised for a healthy holiday season.

Retailers are using a variety of personalization tactics to capitalize on as much as possible of the estimated $884 billion in holiday spending.

Personalization initiatives

Target has introduced its Wonderlist Gift Guide, a digital product finder that helps consumers select personalized gifts. As shoppers navigate through a selection of 400 tailored gift ideas, the tool presents customized recommendations based on personality types, interests and shopping history. Also new this year, Target is providing shoppers with a curated assortment of 2,000 holiday-related items. This seasonal shop-within-a-shop, called Wondershop, is designed to help consumers find the holiday products that best fit their preferences.

1-800-Flowers is also deploying a new product finder tool that guides consumers through a personalized shopping experience. This feature, which is called GWYN (Gifts When You Need), utilizes IBM’s Watson artificial intelligence software to better learn consumer preferences and shape personalized recommendations. This is a smart move, not only to cater to holiday shoppers, but also because the company is evolving from a niche floral website to a multi-branded gifting business. Expanding the product inventory can be a beneficial strategy for retailers, but only if they can continue delivering a seamless and personalized shopping experience.

Retailers’ holiday initiatives go far beyond gift finders, too.

Motocross and dirt bike retailer MotoSport has partnered with Certona to improve its site performance and enable the real-time transfer of product data and inventory. This ensures MotoSport provides online visitors with updated inventory, offers and personalized product recommendations, while eliminating the risk of suggesting out-of-stock items or offers that don’t reflect shoppers’ recent activity. The partnership has already generated increases in engagement with personalized recommendations (42 percent), average order value (20 percent) and units per transaction (16 percent).

eBay has also stepped up its personalization strategy in time for the holidays. In mid-October the company launched the eBay Collective, which provides a curated inventory of furniture, antiques, contemporary design and fine art. eBay tailors the products to its consumers. The initiative represents eBay’s efforts to branch out from its traditional auction style in favor of appealing to shoppers as individuals.

Omnichannel fulfillment

Omnichannel fulfillment is an increasingly popular method for providing a shopping experience that accommodates consumer preferences. According to eMarketer, 42 percent of retailers now offer the option to buy in-store and ship to home, versus 14 percent last year. Additionally, 44 percent of retailers now enable consumers to buy online and pick up in-store (21 percent last year) and 61 percent allow in-store returns of online purchases (18 percent last year). This demonstrates how retailers are focusing on being flexible so they can provide the shopping experience that’s ideal and most convenient for each individual visitor.

With more than 40 percent of online orders picked up in-store, Home Depot is continuing the growth of its omnichannel strategy. The giant retailer is expanding its omnichannel program to include “buy online, deliver from store.” This new concept allows shoppers to buy items online and schedule a delivery from a local store. The option is now available at about 1,600 stores, a figure that has more than doubled since Q2. With its innovative approach to omnichannel fulfillment, Home Depot has seen a steady double-digit growth of online sales in 2016. Online sales were up 19 percent during the second quarter and 21.5 percent during the first quarter.

Toys R Us, which last Christmas had to halt some online orders due to overloaded e-commerce fulfillment centers, also added seasonal employees to help with omnichannel fulfillment. The retailer is offering bonuses and higher wages to attract more seasonal warehouse workers. Furthermore, Toys R Us equipped almost all of its 870 stores to help ship online orders during the holidays, and it began stocking those stores with products weeks earlier than last year. So far so good for the retailer: Its website, fulfillment centers and stores handled record levels of online traffic in the days around Thanksgiving.

Walmart has also optimized its omnichannel fulfillment capabilities for the holidays. The retail giant reported that online sales for Thanksgiving weekend were available for in-store pickup in 30 percent less time than the previous year.

Whether it’s personalized gift finders, real-time personalization or omnichannel fulfillment, retailers are pulling out all the stops to optimize and personalize the shopping experience in time for the influx of holiday shoppers. As retailers continue to make omnichannel fulfillment and personalization a priority, the industry should prepare to celebrate impressive sales records.

About Meyar Sheik
Meyar Sheik is a seasoned software industry executive with 25 years of experience. Since 2000, Meyar has been a web analytics pioneer working with some of the largest sites on the Internet such as Staples, ESPN, Fox, Sony, Best Buy, Disney, CBS and many other leading brands, in the areas of web analytics, personalization and real-time content optimization. Prior to Certona, Meyar was the CMO and COO of web analytics leader, WebSideStory (now part of Omniture/Adobe).


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