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Retailers have a valuable opportunity to present each shopper with personalized product recommendations that match their interests, browsing behaviors, and purchase histories.
These tailored suggestions can help businesses increase sales, reduce cart abandonment, and raise average order value (AOV) — potentially driving revenue and improving efficiency, all while helping to deliver more relevant and satisfying customer experiences.
Today’s shoppers are looking for personalized experiences from retailers. According to Statista, roughly 75% of surveyed global customers expect improved personalization in exchange for sharing personal data with businesses.1
Shoppers are bombarded with ad messaging on every app, platform, and website, which can be distracting, frustrating, and overwhelming. Businesses that engage people with personalized product recommendations can stand out among the competition — winning not just attention, but also sales.
Businesses can use personalized product recommendations to encourage customers to add complementary items to their carts, ultimately increasing average order value (AOV). For instance, concert ticket buyers may be offered the option to purchase event insurance. Or clothing shoppers might be prompted to buy accessories for the outfit they just purchased.
By meeting these expectations with personalized product recommendations, businesses can help boost their revenue. According to a McKinsey report, personalized marketing can lift revenues by 5% to 15%.2 Further, Statista reported that 80% of surveyed global business leaders acknowledged that personalizing experiences to customer preferences led to increased spending, and 62% said it had a positive impact on customer retention.3
Personalized product recommendations — based on past purchase histories and current cart items — can help customers discover items they may not have known they needed or wanted, enticing them to include those and perhaps other items in their purchase.
Relevant product suggestions can also help keep customers browsing and exploring different areas of your online store. This can help boost customer engagement and drive more sales opportunities.
Data collected from personalized recommendations can offer valuable customer insights into shoppers' preferences and buying habits. Businesses can then use this data aggregation to help improve marketing campaigns, product development, and overall customer experience strategies. McKinsey found that personalized marketing can reduce customer acquisition costs by as much as 50%.2
Personalized recommendations can also help businesses understand which products are most popular and which ones might be underperforming. Enterprises can use these insights to optimize real-time inventory management and make more-informed stocking decisions.
Customers may abandon carts because they can't find what they're looking for or they get sidetracked during the buying journey. Personalized recommendations, especially at the checkout phase, can remind customers of relevant products that match their interests, encouraging them to complete their purchases.
Businesses can help further reduce cart abandonment by personalizing the entire payment experience. With PayPal, for example, large enterprises can present customers with digital wallets, credit cards, cryptocurrencies, and buy now, pay later options — making it easier and more convenient for customers to check out using the payment options they prefer.
When businesses suggest relevant products based on a customer's browsing history, purchase behavior, and preferences, they can help create a more enjoyable and efficient shopping experience. This can lead to long-term customer growth, satisfaction, and loyalty. In fact, Twilio Segment found that 62% of surveyed business leaders sited improved retention as a benefit of personalization efforts.4
PayPal’s new Smart Receipts can help businesses deliver personalized product recommendations and cash-back rewards directly to their customers after checkout. 300M+ purchase receipts reach PayPal users each month. With Smart Receipts, businesses of all sizes can maintain customer engagement with rewards earned on the purchase and relevant offers powered by transaction history.5 Smart Receipts pulls from customers’ shopping activity and user profiles to reach them with the right offers at the right time — helping businesses increase revenue at scale.
Learn more about how to reimagine the customer experience with PayPal.
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