What is website personalization, and why should you implement it? A Complete Guide

PersonalizationBy Gladys Gordon

Personalization is now a buzzword — from big company boardrooms to small tables of startups. Gone are the days when businesses only needed a well-designed website and regular content to engage visitors.

Consumers now expect brands to go the extra mile to make their shopping experience unique. And the primary way for businesses to create experiences that resonate with their customers on an individual level is by personalizing their website.

This guide will discuss everything you should know about website personalization and how to get the best results.

What's personalization?

Personalization is the process of creating tailor-made experiences for each specific user that visits a website. You can build these experiences using the information you gather on each user, such as their browsing behavior and demographics.

Rather than providing a single, broad and generic experience for every individual, website personalization allows you to make your site more appealing by anticipating your user's needs and providing relevant information.

Difference between personalization and customization

It's crucial to note that personalization is not the same as customization. Though both aim to create unique experiences for the user, the difference is in who makes the changes and how they create them. Personalization uses automation to tailor the user's experience, while customization allows user to control their own experience.

Let's illustrate this using a coffee shop. Imagine going to your regular coffee shop and finding that the baristas recognize you. They greet you by name and ask if you want your usual. This is a personalization based on what the coffee shop knows about you. On the other hand, customization requires more active involvement from you. Using the coffee shop example, you can customize your experience when you want something a little different, say, your usual order with extra whipped cream. Here, you can change what you consume by actively asking the barista to change it for you.

The table below summarizes the differences between personalization and customization:

CharacteristicsPersonalizationCustomization
Who defines itPersonalization is defined by the company for the user.Customization is defined by the user.
How it is doneCompanies use customer data and AI to make personalization possible.Users curate their experience by selecting what they want the companies to offer them.
ScalabilityPersonalization can deliver unique experiences for an infinite number of users with the right data and targeting.Customization is possible for only a finite number of cases.
ExamplesAn e-commerce personalizes its homepage based on your previous searches.An e-commerce allows you to custom-design your own shoes.
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An example of how Nike's website allows user customization

Types of personalization

  • Recommendations: content or product recommendations according to attributes from user data and trends in user behavior.
  • Landing pages: content variations specific for a user coming from different ads or ad groups.
  • Exit-intent pop-ups and overlays: highlighting special offers, discounts, or promotions.

Why does personalization matter nowadays?

Personalization is now the standard of service you must offer if you don't want your customer loyalty to shift to your competitors.

Customers expect it

When you think of your own experiences as a consumer, it becomes easy to grasp the concept of personalization. Would you prefer to shop with a brand that treats you in a personal manner or one that serves you poorly curated experiences?

Nowadays, consumers want relevant and convenient experiences, and they're moving towards the brands that recognize them as individuals. 91% of consumers say they're more likely to shop with brands that provide relevant offers and recommendations. And 83% say they're willing to share personal data with companies to help create personalized experiences.

It's good for business

Consumers will most likely purchase from brands that know their preferences and deliver relevant communication. As a result, you risk losing your customers to competitors if you don't offer personalized experiences. Data from an Accenture survey shows that 48% of customers left a brand's website and made purchases elsewhere due to poorly curated experiences. To this end, 89% of businesses invest in personalization, leveraging customer data to deliver personalized content and experiences across all marketing channels.

What are the benefits of personalization?

The rewards you get for embracing what customers expect are many, which explains why personalization is the norm for business these days. Here are some of the benefits:

  1. Higher conversion rate: This is the ultimate benefit of website personalization. An Econsultancy report shows that 94% of companies with personalized websites have seen a rise in conversion rates.
  2. Relevant product recommendations: Making accurate and timely recommendations from user data benefits your users greatly, taking away the burden of choice from them.
  3. Improves customer loyalty: Personalization allows you to create unique experiences for users and makes you their go-to brand, resulting in happier customers and increased brand loyalty.
  4. More engagement on the website: Providing relevant content to your customers makes them remain on your site for extended periods. It gives them more reasons to explore and engage with your products.
  5. Better ROI: Personalization leads to better marketing campaigns, from ads to CTAs and landing pages, ultimately resulting in better ROI.

How personalization decreases the CAC and influences ROI

Customer acquisition costs (CAC) can be costly and lead to a loss in revenue if marketing spending is not reduced. It's worrisome for marketers in every industry as they keep finding ways to acquire more customers without breaking the bank.

Avg. ad revenue/User Google.png
Google's ARPU growth with ads from 2017 to 2022.

Personalization can help reduce marketing spending as customers can easily relate and connect with your marketing messages. It fits into every stage of the user journey, and makes it more fluid and straightforward.

Using predictive segments powered by AI, personalization can help you target users in different buying stages at the right time and at the right advertising channel, helping you optimize your ad spend. It can also help you retarget the same users with push notifications and emails.

How to reduce marketing costs and increase ROIHow our customers reduced their remarketing costs and increased their ROI by 13% with personalization
Example alt

Challenges of personalization and how to tackle them

Personalization offers many benefits, no doubt. But with the help also comes challenges that may discourage businesses from investing in it:

1. Data privacy

Many websites use cookies to track different kinds of data, providing them with information for creating personalized experiences. This poses a privacy problem as many users worry that businesses will bombard them with messaging communications or sell their data to third parties. To mitigate this, you must include a privacy statement requiring users' consent to track and store their data. If you want to know more about how personalization goes hand-in-hand with data privacy, read our blog article.

2. Data collection

Accumulating customer information from multiple databases can be challenging, resulting in data silos. This can be eliminated by syncing all your data in one place using one CDP platform in real-time. As a result, it becomes easy to create relevant recommendations for your users.

3. Performance scalability issues

The large amounts of traffic from displaying dynamic content on your website may cause your site to load slowly, decreasing its performance. But there are ways to mitigate this. One is using a content delivery network (CDN) for loading images faster. Another is removing unnecessary plugins and extra files that don't contribute to your website's performance. And lastly, using personalization tools that provide low latency APIs and lightweight SDKs, allowing implementations that don't block the page load. This article details how to implement personalization without struggling with the core web vitals metrics.

Types of data for personalization

To implement personalization effectively, you need data. Many data sources exist, and you can get super detailed in your outreach. Use the data to create a personalized experience for the right user at the right time.

Types of data used for personalization.png
Types of data used for personalization.

The table below describes the categories of data types for personalization:

Data CategoryDescription
Contextual dataLocation, weather, date, time, browser device.
Demographic dataGender, age, city, country.
Behavioral browsing dataAbandoned cart data, search keywords, purchase history, transactional data.
Traffic sourceDirect or paid search, referrals, social.

Data accuracy

To get the right data for personalization, you need to keep three critical factors in mind. The first is to use only updated data, as you can't get any relevant insights from stale, inaccurate data. Secondly, use data from all customer touchpoints. This allows you to see the entire customer journey from end to end. Thirdly, ensure the data you're using is fit for purpose. This means you should look beyond the quality of the data and focus on the usage to ensure you're getting the most value out of that data.

Website personalization and AB tests

Personalization and AB tests, like chocolate and peanut butter, complement each other well. Once you commit to implementing personalization on your website, you must test it to see if it's working.

AB testing allows you to discover your website's best-performing element or variation for each target audience. You can start by predefining each target segment based on user data and then creating an AB test for each.

Follow these few guidelines to help you get the best results:

  • Test one variable at a time
  • Adapt the number of variations to the traffic volume
  • Define what KPIs you want to measure before starting the test, and based on what your goals are
  • Test, test, and test again.

How to implement personalization on your website

Proper implementation of personalization on your website requires some strategies and smart tips. It's important to consider how you segment your users and collect data to identify them. Then you should focus on creating a plan for personalizing your website using the insights gleaned from their data.

To summarize, apply these smart tips to personalize your website:

  • Set clear goals: Define your goals to determine the best effective way to personalize your website.
  • Gather user data: This helps you understand your users and how they interact with your website.
  • Segment your audience: Break down your audience into specific groups and create user personas to provide relevant content.
  • Create a plan: This would include an outline of strategies for personalizing your website. Think about the content you want to show them, and then identify the areas you want to personalize to attract your target audience — for example, the homepage, product page, or search results. Check out our blog post for learning how to craft a good personalization plan.
  • Put the plan to action and measure performance: We've already discussed how AB tests help you determine which elements or variations of your personalization work. So as you track and measure the success of your personalization efforts, identify the flaws and adjust where necessary.

Wrapping up the best practices to follow when personalizing your website

1. Make decisions in real time

One of the best practices for optimizing your personalization efforts is using users' real-time data while they're still active on your website. This ensures you deliver the right message or product before they leave the site. An example is when an e-commerce upsells or cross-sells to buyers while they are still on the product page.

2. Don't overuse recommendations

As much as personalization shows users relevant content and information, too much becomes overkill. Seeing the same product or service again and again may irritate them and make them abandon your site. Instead, allow them to explore your site to discover new things, giving you a chance to advance your personalization efforts.

3. Test your ideas

Not all personalization strategies are going to work out. So test and measure results to figure out which strategies to implement. It's a great practice to always test your hypothesis before deploying to save valuable time and resources.

4. Have a clear privacy statement

Website personalization involves collecting users' private information. Therefore, a privacy statement assures users that their data is safe and won't be misused. Display the privacy statement clearly on your website to give your users a sense of security.

5. Track your analytics

Monitoring the performance of your website consistently reveals areas where your personalization efforts are doing well and where they're falling short. Use website analytics tools that help you understand user behavior and give you insights on optimizing them.

How Croct can help you

Croct helps companies personalize their website's content according to each user's context by considering each user's interaction with your website through their entire journey.

One of our successful case studies is the Farmamake brand. With our platform, Farmamake's marketing team personalized the banner carousel on their homepage according to each user's interest. The personalized version yielded an increase of 82% in conversion rate.

In a second case study, the team at Creditas used Croct to personalize and run AB tests on their web page to validate different hypotheses. The tests resulted in an increase of up to 18% in conversion rate with the personalized variant.

If you're currently searching for the best personalization platform to start or scale your website personalization, create your free account and explore our platform by yourself.

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