ChoiceStream

Executive Summary

The annual ChoiceStream Personalization Survey provides insight into consumers' interest in, and perceptions of, personalization and product recommendations. The findings for the 2009 survey are being reported in two parts. Part one of this year's key findings are as follows:

1. Mobile recommendations offer retailers a significant potential revenue opportunity whereas social networking does not
2. Shoppers definitely notice product recommendations, find them useful, and buy products based on them
3. Recommendation placement matters to shoppers; recommendations on product detail pages are most likely to prompt purchase

Detail on these findings appears below. Part two of the survey findings will be available soon.

Key Findings Detail

Mobile Product Recommendations Heat Up in 2010

As smartphone adoption grows, so does the need for retailers to optimize their mobile merchandising to make it easier for shoppers to find what they need on a device's small screen.

As evidenced by this year's survey, product recommendations do that and consumers are clamoring for them. 65% of respondents would buy more products on their devices if they received recommendations on them from retailers they trust. This creates a significant revenue opportunity for retailers in a market with tremendous up-side potential.

Social Networks Are a Different Story

The survey found that while m-commerce is a hot spot for recommendations in 2010, social networking is not. Of the respondents who belong to a social networking site, only 8.5 percent report that they have ever made a purchase while on the site. And, only 27 percent indicate any interest in product recommendations from trusted retailers.

Based on these results and other market research, retailers are advised to promote their brand experience and offers using social networks but defer significant investment in product recommendations until the market for commerce on those networks matures.

Shoppers Notice Recommendations While Shopping

When asked if they noticed product recommendations under headings like 'More like this...,' 'You might also like,' and 'Recommended for You,' 74 percent of respondents said yes.

Further analysis showed that bigger online spenders were more likely to notice recommendations than those who spent less. For example, of those who spent more than $1,000 online during the previous six months, 84% noticed product recommendations, while only 66 percent of those who spent $1-100 noticed them.

But, Some Are More Useful Than Others...

Overwhelmingly, consumers report that product recommendations provide useful guidance when shopping; but their usefulness depends a great deal on where they appear within the shopping experience.

85 percent of shoppers believe it is useful to have product recommendations early in the sales cycle on product detail pages and category pages whereas only 47 percent indicate it is useful to have them on order confirmation pages.

Most Importantly, Shoppers Buy Products Based on Them

The placement of recommendations also has a significant impact on sales. The majority of active online shoppers (those who spent more than $500 online in the past 6 months) indicate that they have bought something based on a retailer's online product recommendation, but only 16 percent claim to have purchased based on a recommendation in a shopping-related email (e.g., shipping confirmation). The majority of purchases were based on recommendations that appeared on product detail pages (58 percent) or category/brand pages (40%).

Survey Respondent Overview

The survey was conducted by MarketTools, Inc., a leading online market research solution provider. The survey respondents included 525 adult, U.S.-resident Internet users across four age categories (18-24, 25-34, 35-49, 50+). The respondents were 49 percent male and 51 percent female; and, 98 percent had made at least one online purchase within the previous six months.