JJ Tyson — November 26, 2019 Product recommendations are one of the most important tools that your site has. They have the power to increase conversions, engagement, and Average Order Value.
However, poorly executed product recommendations can irritate shoppers and create unnecessary friction in the conversion flow.
To ensure your recommendations are consistently excellent, one of the best options is a product recommendation engine.
A product recommendation engine utilizes a recommendation algorithm to suggest relevant products in real time. They take a huge number of variables into account, such as: product pages viewed, time on the site, wishlist entries, and many more.
A product recommendation engine is a vital tool for consistently engaging customers. Here are 4 reasons that a product recommendation engine can be so profitable.
Product Recommendations are Your Sales Team
Customers who encounter high quality product recommendations are 70% more likely to convert than those who don’t. That’s because product recommendations are the ecommerce equivalent of a live salesperson.
In a traditional retail environment, salespeople are the core of your business. They answer customer questions, speak to concerns, and yes – recommend products. Good salespeople are a huge reason for the success of some retail outlets. They know how to upsell, downsell, and cross-sell. But obviously, live salespeople are not an option for ecommerce sites.
Ecommerce is a self-guided experience. While a great site design and intuitive controls can help alleviate customer concerns, they can only do so much to encourage uncertain shoppers.
A product recommendation engine accomplishes many of the most important tasks of a salesperson by encouraging both complementary purchases and similar goods of varying price points.
Customers Expect Good Product Recommendations
Over the years, personalization has become a major topic in ecommerce. That’s because in the early days of online shopping, very little was personalized. Transactions were robotic, and essentially the same for all customers. However, retailers now understand that individualizing the customer experience is vital to success.
80% of customers are more likely to purchase from a site that uses personalization. Likewise, a full 91% say they’re more likely to shop with brands that provide relevant offers and recommendations.
If you’re not using a recommendation engine, you’re likely to be missing out on significant revenue.
Good Recommendations Entice Users Without an Incentive
We’ve all been there – you’re browsing a site where nothing seems to be jumping out at you as a “must have.” In many cases, we’re apt to abandon. That’s where product recommendations can be highly useful, according to data.
In 2017, a study from Salesforce examined 250 million ecommerce site visits to get a better idea of what drove conversions. The results were astounding. Even though only about users only interacted with dynamic recommendations about 7% of the time, these visits drove a full 26% of total revenue.
That means though the majority of your shoppers won’t interact with product recommendations, those that do are far more likely to convert.
Bad Recommendations Scare Away Customers
Many ecommerce professionals are under the impression that even if bad product recommendations don’t help a site, they at least won’t hurt it either. However, research from Bazaarvoice says otherwise. According to the report, a full 38% of shoppers say they are likely to stop shopping at a site that offers consistently bad recommendations.
Why? Because they’re annoying. Recommendations are supposed to feel personal. Simply recommending popular products may seem like a safe bet, but it doesn’t take individual preferences into the equation.
Giving bad product recommendations to your customers is like giving bad movie recommendations to a friend. They might consider it, but at the end of the day, the end result is disappointment and irritation.
For product recommendations to be effective, they can’t be annoyingly bad.
Considering Better Product Recommendations
High quality product recommendations bolster your revenues, increase average order value, and improve the user experience.
By utilizing a product recommendation engine, ecommerce brands can ensure they maximize per-customer value and never leave revenue on the table.
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