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How retailers should use personalization in online shopping to optimize their conversion ?

A practice increasingly used in e-commerce is personalization and this is understandable when we see that it can reduce acquisition costs by up to 50% and increase turnover by 5 to 15% (McKinsey report). The personalization of online shopping is a strategy that not only optimizes the customer experience but also boosts the company’s results.

What can a website do to offer to a potential customer a unique experience? How to create value through personalization?

A practice increasingly used in e-commerce is personalization and this is understandable when we see that it can reduce acquisition costs by up to 50% and increase turnover by 5 to 15% (McKinsey report). The personalization of online shopping is a strategy that not only optimizes the customer experience but also boosts the company’s results.

The question then remains as to how to personalize your e-commerce site effectively and for what results?

What are the benefits/advantages of personalization?

To better understand the impact of personalization on the results of an e-commerce site, here is some data: personalization of a website increases turnover (by 5 to 15%), achieves a ROI 5 to 8 times higher (McKinsey report) while reducing marketing costs by 62% and generating 3 times more leads (Demand Metric).

Effective personalization has other benefits, such as reducing the bounce rate. By personalizing from the home page, it will encourage potential customers to view an article they are likely to appreciate. personalised content will also encourage cross-selling and up-selling. In addition, personalizing the shopping basket, for example, can push the user to add other products to his order and thus make a larger order than expected.

A personalised experience means also retaining attention, enhancing engagement, and building loyalty. This is an important aspect to take into account: retaining a customer costs up to 5 times less than acquiring a new one (Customer Retention as a Competitive Weapon, Reichheld, F.F., and Dawkins, P.M.).

How to customize your e-commerce site

There are several ways to personalize your online sales site, throughout the customer journey. Indeed, personalization can be done through:

- The proposal of complementary products according to the history of purchases in the customer's basket

This technique is also called cross-selling. It is a tactic to increase sales by suggesting additional, related or complementary items to a customer. It is possible to use it thanks to the acceptance of cookies by customers. By offering them items that would enhance that product’s use, of additional products that make the chosen item work better, e-commerce performs a valuable service that grows customer loyalty. This last point is important because, according to Adobe (2020 Digital Economy Index), 40% of an e-commerce store revenue comes from the 8% of its loyal customers.

- Create personalised Homepages

If you are collecting cookies on your e-commerce website, it means that you already have a lot of information about your potential customers. If the homepage already targets all the product categories, people can choose what they like easily and the next time, with a homepage personalised on their past actions, they will focus on the category they are more interested in and shop with fewer distractions: this means better shopping experience and higher conversion rate.

- Recommendations based on previous purchases and loved products

According to a study by Barilliance, personalised product recommendations account for almost 31% of e-commerce revenues and they have a significant effect on conversion rates.

Thanks to the use of cookies and analysis of data, the website can show “recently viewed products”, “loved products” and your previous purchase in order to suggest similar brands, similar styles with the range of price of the last purchases and preferences. This kind of personalization can increase the sales and the conversion rate for the company.

- Geolocation

An e-commerce store can see from where its visitors come from through Google Analytics and a company can develop tactics to increase their conversion rate through geotargeting. Geographic targeting allows a website to dynamically tailor content based on the location of the visitor. Some of the tactics that can be used are: displaying the closest physical store, providing localised shipping offers, displaying products relevant to the local climate and culture.

- Highlighting of order history or basket history

If a homepage highlights the order history and it displays the recently viewed items with a call to action (ex: “Don’t forget, only 8 pieces still available”), it means that the company is reminding you what you have liked and it suggests you consider it. This is possible through the activation of the cookies.

- The use of a chatbot, to gain speed and relevance in the processing of customer requests

Chatbots are software applications based on AI, that can create value in enhancing the user experience and creating new sources of value to make it richer, more tailored, and more convenient. Making your best customers feel special and welcome is one way to foster loyalty and increase revenue (“Artificial Intelligence, The Next Generation Frontier?” – McKinsey discussion paper, 2017). Based on browsing and shopping history chatbots can give you recommendations, help to discover styles, and answer every kind of question. This means that it is like having a store designed for you, but how much more workforce is needed to implement a bot? How to adopt a chatbot? Most of the small-medium companies use a third-party tool to make the process less expensive and to have someone who monitors the ROI and the platform’s analytics, but also several big companies such as Sephora, H&M, or Zalando. In fact, it is forecasted that 70% of chatbots will be retail-based by 2023 (Juniper Research) and that 47% (Hubspot) of consumers would be open to making a purchase from a chatbot.

There are of course many other ways to make the customer experience on your e-commerce site more personalised, but now we'll see why it's worth doing it.

Cleed proposes a solution to personalize your online sales.

Cleed is a personalised shopping assistant that uses AI trained on already existing users' preferences and purchases and forecasts what people are going to like through the collection and analysis of valuable insights.

It allows, in a chatbot format, to answer precisely to all customers' questions all in an automated way. We help retailers to personalise the user experience of their e-shop thanks to a smart AI conversational assistant that engages and gives advice to the visitor, allowing you to significantly increase your conversion rate, your revenue, and customer satisfaction.

The conversion rate is 6 times higher in-store than online (Smart Insights), notably because of the additional in-store personal assistance to the client. For this reason, with our chatbot based on AI, the customers can have a personalised experience, someone who answers every kind of question, from the delivery fees to style suggestions. With our solution, the potential customer will never feel lost or overwhelmed by the big choice of products, the engagement to the brand increases, and the loyalty too.

Cleed allows the user to benefit from :

  • A free personal shopper: every day the customer receives a selection of articles that correspond most to him so that he doesn't miss out
  • Instant customer service (24/7): augmented salesperson that answers every kind of question directly and helps him to find what he is looking for quickly. There will be no more lost time and confusion and an increase in conversion rate

Cleed allows companies to benefit from:

  • Plug & Play: Effortless implementation in one minute compatible with every CMS
  • Automated cross-selling and social selling; follow all conversations and take over when necessary
  • Through deep data analysis you can get a 360 degree view of each customer and target your e-commerce better
  • Increasing revenue, online presence, your bounce rate through the collection of precise data of users’ preferences

Use Case : Manfield

We help Manfield to improve their conversion rate thanks to our assistant. Here are the specificities and benefits of this implementation :

  • They use both Shopping assistant and Live chat to implement their strategies to the maximum and engage with their customers.
  • They use a mix of automated and human answers in order to be as much precise as possible
  • They can propose to their customers looks suggestions, regarding their profile
  • As they are a multi-brand website, customers can specify they favorite brands during the onboarding
  • As they have a complex size guide (each brand having its own size referential by country), our tool integrates it, in order to make the conversion automatically during the experience
  • Their conversion and user experience has been improved since this implementation

Use case : Manfield

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