Personalize and customize: the future of the shopping experience

05 April 2022 | Technology

The recommendations from Amazon and Netflix are just what we didn’t know we needed until we saw them.

That’s called a personalized experience and no, it’s not the same as customization.

In the digital age, the very human desire of consumers is to receive a unique treatment. No one wants to feel like another number within a database, therefore personalization and customization have come into the spotlight in recent years within marketing and the market in general. Although they are often confused or used as synonyms, they are two practices that operate in different areas and complement each other.

Personalization and customization are not the same

Although the word “customization” is used interchangeably for both experiences and products, in marketing the term refers to products or services that are modified by users. On the other hand, personalization is a strategy that a company carries out in the processes and attends to the preferences of the clients, which have been studied previously. It is used in order to better connect with people and offer optimal, unique and efficient care.

A clear example is Amazon with its famous legend: "Customers who viewed this item also viewed", with which it provides a shopping experience related to the interests of the user and the guide to other products that could arouse their interest. These suggestions are based on your search history, wish list and other demographic and personal data. On the other hand, customization is a strategy that allows the customer to modify the product (or packaging) with tools provided by the company.

An example is the unforgettable Coca-Cola campaign "Share a Coke", in which they launched cans with names and, if someone did not find their own, they could go to centers located specially to type their name and buy their can. Another example is Levi’s customization studio, where people can go to add exclusive designs to their garments and adjust them at will.

The trend is back to basics, but through technology

Personalization and customization are nothing new. In ancient times, people went to stores where it was about you. Businesses knew their customers, their names, their tastes, their lifestyle and offered them what could interest them —personalization—; in addition, the products were unique for each person —customization—. Over time, these practices ceased to be commonplace because of the shift in production methods from handicraft to manufacturing and then to mass production.

Today, however, predictive technology, artificial intelligence, the use of cookies and data analytics make it possible for large and small businesses to rely on the information at their disposal to deliver personalized experiences and unique products. This brings great benefits for the company in terms of loyalty, reputation, exclusivity and, of course, an increase in conversion. Who doesn’t want a deal that not only gives you what you ask but guesses your needs and offers you the possibility of modifying the product to your will?

Personalization should not be invasive

Now, consumers are more aware of the risks and benefits of online shopping and are more careful about handling their information. In the valuation of the purchase, they carry out a search of the reputation of the company and its data handling. So, in this scenario, it is relevant that 83% of people are willing to share their information in exchange for a personalized experience that offers satisfaction and a clear and transparent data management policy, according to Accenture.

That is, personalization in the shopping experience is a priority for consumers. They are looking for a customer journey that will guide them according to their lifestyle. A basic segmentation that groups people by general data as a socio-economic level or by demographic information is no longer enough, but by very specific interests.

However, the ideal is to look for and find the balance in order not to generate distrust or fear with a hyper-personalization that gives the sensation of espionage. Notifications about physical outlets according to their latest locations or social media ads about what they have searched for on a website are perceived as invasive by consumers, according to Accenture. This goes against the goal of personalization and customization: to humanize the shopping experience.

It is essential to build trust through responsible information management and clear information policy.

Benefits of implementing personalization and customization

Organic reach and loyalty

People do not hesitate to share with pride what has been created especially for them, which is reflected in a greater organic reach on social networks. A loyalty-seeking strategy should add customization and campaigns with micro or nano influencers. The latter is one of the trends that reached prominence in 2021 and is ranked as one of the strongest by 2022.

Differentiation with competition

Products or services with customization options differ significantly from the competition, as they demonstrate a commitment to the particularities of people, a solid knowledge of the niche and greater security. In addition, people relate directly to the company, creating trust, transparency, exclusivity and a sense of community by participating in the process.

Flexibility and permissiveness

Customization represents a low return rate and allows for an increase in price, as people are willing to pay more if they are involved in the creative process of the product. Even customers are willing to tolerate longer delivery times than usual.