To most small and medium business owners who have an online store it may seem impossible to know what each customer wants on an individual basis. However, understanding that human behavior is predictable, making your recommendation engine more efficient at suggesting relevant items, and fixing any potential issues your e-commerce platform will result in increased sales.
Effective advertising is the key to success and, by knowing how the presentation of your inventory affects customer behavior, you can tweak your website’s appearance to not only gain new customers, but keep the ones you have.
CUSTOMER BEHAVIOR IS PREDICTABLE
While each customer may have a different motivation for shopping in your online marketplace, their behavior is predictable and you can optimize your recommendation engine to suggest the most relevant items for them. For example, recommending Valentine’s Day gifts starting from the middle of January is a good idea followed by even the most traditional brick-and-mortar retail locations. Even when shoppers purchase items in store, most will first check out online prices and inventory, according to Statistica where 74% of customers surveyed “use a tablet to compare prices before a visit.” Making the right recommendations are therefore key to increasing your sales, especially around the holidays.
Knowing that customers are predictable and their behavior can be observed as a series of patterns, business owners should review their web analytics for specific information regularly and make sure the customer experience is seamless. Do customers avoid a page? Why is that? Is the page malfunctioning or is an element of the code broken? Are the items being displayed and sold on that page appealing? Outdated? Too expensive? You will need to find out and fix any issues that become apparent.
Researchers Cheng Lu Wang and Chayapa Katawetawaraks, published their paper “Online Shopping Behavior” in the Asian Journal of Business Research, stating that “if online stores want to convert visitor into buyer, they should improve their website by offering customer a comfortable, logical, interesting and hassle-free process and easy language by creating fast website with functional design as smooth as possible.
Therefore, as a business owner, you should review any issues your customers have and take steps to correct them. This way, you can market your inventory more strategically to customers to gain their interest and increase sales.
ADVERTISING INFLUENCES CUSTOMERS’ ACTIONS
There is a reason why psychology is an area of study in the advertising world: it works. By understanding the mental processes behind decision-making as well as influences that shape customer’s everyday habits, we can understand how to direct customers towards purchasing our products. Take packaging for example: snowmen and candy canes evoke images of Christmas and the Winter Holidays. Nostalgic images from the Great War or the 1950s family house in the suburbs with the white picket fence is sure to grab elderly customers’ attention, even if they have never lived in such a house or served in the War. For children, bright colors interest them. This is effective subliminal marketing tied to cultural memes and shared experiences.
The same principle applies when shopping online as subliminal marketing is everywhere. According to Nielsen, “almost half (48%) said they trust ads in search engine results, online video ads and ads on social networks. More than four in 10 (42%) trust online banner ads, up from 26 percent in 2007.” Although the packaging can remain the same online as it is in-store, visitors to your online marketplace, as well as prospective customers, will judge the appearance of the item online.
Ensuring your recommendation engine makes similar suggestions to customers will ensure that they click on the items and buy them. You can do this, for example, by creating themed sections of your online store for various holidays and recommending similar items within the section customers are viewing. You can also divide your e-commerce platform by demographic and recommending various items that each customer would like, based on age and gender information listed their metadata.
By narrowing the niche where a customer is looking and then marketing items to the customer based on what they are most likely to buy, you have already increased the chances of making a sale. This also ensures that no item proposals are wasted on customers by the recommendation engine.
For instance, no young bachelor wants to be recommended baby shoes because they do not need to buy any. However, if they are searching for cigars it makes sense to recommend wine and cards because cigars are traditionally used at celebratory events. Use your recommendation engine to make better suggestions like this one to improve customer satisfaction and corner your niche market.