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Three Hot Tips to Drive Sales with Recommendations

The latest Monetate Ecommerce Quarterly brought disquieting news to the ecommerce industry. Save for the booming 2014 holiday quarter, rates for conversions and adding items to carts have been in decline since the first quarter of 2014, barring Q4.

This is taking place despite shoppers visiting more product pages per session when they browse an online seller. It’s a small increase according to Monetate, with 2.28 product views per session in Q1 2015 compared to 2.09 in Q1 2014, but that increase isn’t necessarily translating into conversions.

A few tactics tested by retailers cracked the proverbial code in boosting conversions, by providing product recommendations. One retailer worked to garner more back to school sales in 2014 by presenting a grid of best selling products on their home page; Monetate said the tactic worked so well they kept the grid in place.

A second retailer found recommendation success through a more sophisticated recommendation approach. Monetate said the retailer eschewed the typical “viewed also viewed” and “purchased also purchased” presentation with one that delivered recommendations in line with the perceived shopper’s purchase intent.

This is an approach observed in the brick and mortar world as well, and perhaps most famously in an incident concerning Target, an angry father, and his (unbeknownst to him) pregnant daughter. Data mining linked the woman’s purchasing habits to that of an expectant mother, and Target began sending her coupons for baby-related items – as it turned out, accurately.

Monetate’s third example of product recommendation effectiveness looks counter-intuitive. Yet in the example of another retailer, they found that after a shopper’s cart achieved a certain value, turning off additional recommendations became the best course of action.

With Monetate finding conversion rates in Q1 2015 hitting 2.32 percent versus 2.54 percent in Q1 2014, alternative strategies to boost those rates become important. Currently the industry is observing online retail giant Amazon.com retooling its strategy regarding its most visible recommendation tool, product reviews.

In order to keep those product reviews effective and relevant, Amazon tweaked its reviews system with a little dose of “machine learning” to improve the experience for site visitors. Newer reviews and those from verified purchasers will have more impact on both the reviews people see as well as the star rating for a product.

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David A Utter
David A Utter
David A. Utter is a freelance writer based in Lexington, KY. He has covered technology topics from search to security to online business and has been quoted in places like ZDNet and BusinessWeek. He considers his appearance on NPR's "All Things Considered" with long-time host Robert Siegel a delightful highlight. You can find him on Twitter @davidautter and on LinkedIn.