Know why product recommendation is vital for your e-commerce business success in 2023.
In today's digital era, online shopping has become essential to people's lives. So new ecommerce stores are continuously launched daily by future entrepreneurs like you.
Shopify platform has become one of the first choices to start an online retail shop.
With the growing popularity of eCommerce websites, Shopify has become one of the most widely used platforms due to its customizable themes, user-friendly interface, third-party app integrations, and unique features that help to grow ecommerce businesses.
One of the vital features an ecommerce business needs is product recommendation to compete in a highly saturated ecommerce market. The product recommendation feature helps to improve the AOV (Average Order Value).
This is not only the benefit of the product recommendation feature.
In this article, we will discuss other important benefits of integrating a product recommendation system with a Shopify eCommerce website.
Benefits of Product Recommendation to Ecommerce Website
Enhanced User Experience
Personalization plays a vital role in providing an exceptional user experience. A product recommendation feature on your Shopify store can help your customers with personalized product recommendations based on browsing and purchasing history.
According to Accenture, 91% of consumers will likely shop with brands that provide relevant offers and recommendations. So, personalization improves your Shopify website user experience, increases customer engagement, and drives sales.
Increase in Average Order Value(AOV)
The product recommendation feature increases the average order value, an essential metric for any eCommerce business. A product recommendation system shows users related products or auxiliary products to improve their chosen product, increasing the average order value.
As per Barilliance, customers who clicked on product recommendations had a 70% higher likelihood of adding the recommended product to their cart, and those who did so had a 51% higher likelihood of completing the purchase. This increase in order value is due to relevant recommendations presented to customers.
Improved Conversion Rates
Conversion rates are critical for eCommerce businesses. A product recommendation system can significantly improve the conversion rates of your Shopify store.
Barilliance conducted a study that found that eCommerce websites that implemented a product recommendation feature experienced an average increase of 176% in conversion rates.
The study also revealed that customers who clicked on product recommendations were 4.5 times more likely to convert than those who did not.
Enhanced Customer Retention
While acquiring new customers is essential, retaining existing customers is equally important. A product recommendation system can enhance customer retention by providing relevant recommendations that keep customers engaged with the website.
McKinsey conducted a study that found that companies prioritizing customer retention can expect a 25% to 95% increase in profits. Thus, a product recommendation system can significantly contribute to customer retention, leading to increased profits for the business.
Data Insights and Analysis
A product recommendation system provides valuable insights into customer behavior, enabling businesses to make data-driven decisions.
The system can track customers' browsing and purchase history, allowing businesses to analyze customer behavior and preferences. This analysis can help businesses identify trends and make informed decisions about product offerings, pricing, and marketing strategies.
Conclusion - Importance of Product Recommendation for Ecommerce Business
Integrating a product recommendation feature with a Shopify eCommerce website can significantly benefit businesses. It enhances user experience, increases average order value, improves conversion rates, enhances customer retention, and provides valuable data insights and analysis. With eCommerce continuing to evolve, a product recommendation system has become essential for businesses to remain competitive and succeed in the digital marketplace.