Personalization versus Customization

A lot of things in online retail have changed in the last some years. The biggest is that we have been told that the online buyer now doesn't like take-it-or-leave-it experiences. I'm not sure anyone's tested it out (e.g. do users buy from suboptimal websites if, say, the prices are slightly lower there?), but let's say it makes logical sense. Another equally big thing that has changed is our ability to create multiple experiences on the same website, without which the first insight is useless. The third thing to keep in mind as background is what I may have said before in the Escalator Problem post, most shopping sites are built by techies, not retailers. Techies love complexity. Multiple experiences, multiple skins on the same backbone is exciting and cool for techies.

As a result of all the above and more, the hue and cry for Personalization.

There's one small school for customization and another big school for personalization, to be clearer, and the second school considers vanilla customization-ability uncool. Custom flows are about giving the user a choice of experience that the user explicitly makes (e.g. you want to see more deals? more lifestyle or tech? when you log in?) while Personalized flows second-guess the user (e.g. we know that you have bought / browsed T-shirts, so here's more T-shirts when you log in). It is cooler to not ask the user but surprise him / her with what we know without being told.

I'm not sure what the best approach is. Personalization could be cooler but could just be techie-cool and not user-cool. I believe customization is safer, not sure if that's the best. Here are a few things to remember whenever, if ever, we as businesses make this call.

a) Users may actually like being asked questions when they walk in. Maybe it's a nice thing to ask them if they like seeing deals on furniture better than music instruments.
b) We know some people mind being second-guessed. We all know the Target example, what happens when your analytics team figures out someone's daughter is pregnant without that someone knowing about it.
c) There could be parts of the user's browsing or buying that (s)he doesn't want recorded for a number of reasons you can imagine
d) Preferences change, with time, with occasion and so on. You may know the buyer's history, but that may not be a good predictor of his / her present state of mind. For that matter, even people change over time.
e) There could be things the user is done with. Maybe (s)he's already purchased the dream double-bed from your site or elsewhere, and now your snowing him / her with latest double-beds is not just useless but harmful. The next time the same person will buy a double-bed is either ten years later or never.
f) There is a distinct possibility, and probability of multiple-user-ids e.g. the son using his Dad's id or the wife using her husband's - maybe it is faster than creating a new id or maybe that someone's received a coupon the other person wants to use. In this case you'd be personalizing for an average of the husband and the wife, a person who doesn't exist, and not impressing them both.
g) Personalization needs data (if not Big-Data, the buzzier, fuzzier word) and if a lot of your users are new users without a lot of data history, you'll have a cold start problem. By the time you figure out the person's preferences, you may have already pissed him off with irrelevant suggestions

I'm sure a lot of statisticians and coders are working on these angles as we speak, but we have buyers walking in now. What should we do? Any views?

How much Variety is good?

a) a lot?

b) sufficient / enough?
c) too much?
d) any other_____?

It is not as simple as it looks. Sometimes I'm in a hurry and I just want to go right to the counter and pick up my stuff, sometimes I have the time to wallow. That's just me. Sometimes I feel a store isn't even credible if it doesn't have five brands of shirts, and sometimes I get annoyed when the salesperson 'encourages' me to try just one more brand. Imagine being led through a thousand shirt-options, to be told in the end it's not available in your size!! Extremely non-funny, this.

So it is complex, and all this while it's still me. There are other kinds on the planet with their own preferences. Mars and Venus, I  hear, are different. Mission-shopping and Impulse-Shopping is different. Routine and Occasional shopping is different. Variety could satiate or irritate. So is it that complex or are we looking through the wrong lenses?

Maybe yes. What the consumer looks for is availability, when it is mission-shopping and assortment, when impulse-shopping. Variety is the backend lever that leads to availability and assortment. A good retailers knows it is not wise to put your entire assortment on the shelf. I was chatting with an experienced retail CXO recently and he told me about this very interesting incident. Their shoppers complained of low variety, while their SKU count was actually higher than competition. After a drastic reduction in SKU-count, the customers turned around and said now you have variety. Counter-intuitive? Maybe not.

Maybe what gets articulated or captured as variety is simply the ability to find or discover your product.

Don't get me wrong - again - I'm not saying variety is bad, and I'm not saying the buyer wants only one choice (aside - views from Google might be interesting, I really want to know who the search engine impresses with the total number of results and time, and I really want to know how many ever clicked the "I'm feeling lucky" button).

But if we are on the same page, implications are many-fold for retailers and marketplaces. When one is creating the initial assortment, variety adds to the experience and lends credibility. Beyond a point, it could add to confusion. This is super-critical in the online world, where one might feel real estate is free or unlimited, while it is actually not. The first-fold of the homepage is not unlimited space. More important, the buyer's ability to process information and his / her patience is always limited. It could be cool to say I have 247,000 results for your search, but unless we guide the buyer to what (s)he wants or needs, it's just noise. The buyer knows 246,999 out of these results are not what (s)he's looking for, and maybe we're giving him / her more and more of what (s)he's not looking for.

The two broad approaches could be either to curate via a Tailored Shopping Experience (i.e. we as store-owners decide / guess what you need, and show you only that one item you most-probably want, not the endless variety it takes to ensure we find a match) or via decision-aiding tools. Give the user a set of check-boxes and sliders to reduce the 247,000 to just 4 items (s)he can now compare on key attributes.

In a retail store, they lay out some key designs of shoes, in some sizes, in a way that looks most welcoming and least threatening. It will be scary if every size in every design is laid out on a table. You probably realize that's how good offline sales-people work. They just ask the buyer a few initial questions, narrow their eyes, lean back slightly and say, "I think I know what you're looking for", smile, and pull out four shoes you love.

Image courtesy: wallpaperscraft.com