October 10, 2018
The State (and Future) of Digital Marketplaces
Marketplaces are unique. Unlike typical retail platforms, which generally only involve communication between two parties—brand and consumer—marketplaces are more dynamic, with 3 streams of communication:
As marketplace operators already face plenty of challenges, any tool they can leverage to streamline communication would be great help. This is where AI-based tools come into play, making it possible for marketplaces to leverage extreme personalization to improve communication across the board.
For those unfamiliar with the term, extreme personalization is what you get when you use artificial intelligence-based tools to optimize messages to consumers at the 1-to-1 level. With extreme personalization, it’s possible for marketers to make their platform more attractive to buyers and sellers and improve marketplace liquidity as a result.
Given the power of extreme personalization, there are several ways it can improve marketplaces’ unique streams of communication. Below are just a few examples.
One of the biggest pains marketers had in the past was imprecise email list segmentation. Before the era of extreme personalization, marketing teams would take a relatively small sample set of recipient email addresses, test two messages, see which message was most effective, and then the winner would be sent to the remaining recipients.
With that in mind, it’s important to remember that just because a message works for a small segment doesn’t mean the message will resonate with the rest of the audience. AI-based message variant optimization tools change that by enabling brands to continuously test multiple versions of messages so that the most relevant version is always known and sent to the target audience at large, even if it changes over time.
More than just a way to measure subject line performance, solutions like these enable you to test varying message body copy, images, calls to action, and a variety of other components.
In order to be successful, marketplace operators need to take a more strategic approach to communications. It’s becoming clear that rather than sending messages in batches, communications need to be sent at the individual level, taking individual preferences into consideration. In this case, individual preferences for send time must be considered and acted on accordingly.
Extreme personalization enables messages to be sent at a 1-to-1 level so that the communications are received when the user is most likely to view the message and engage with it. For example, Eduardo enjoys shopping for clothing online after work. With an old-school approach to personalization, he would have received a promotional message whenever the brand sent out the batch, instead of at the precise time that worked for Eduardo—6pm on weekdays.
This means Eduardo wouldn’t get valuable messages from his favorite brand when he’s most likely to engage. Instead, he’d get the message when he may not be online, and the message would get pushed down in his inbox, lowering the chance that it would be opened and engaged with.
On the other hand, with extreme personalization, a marketplace can develop a profile on each individual consumer. Using artificial intelligence-based extreme personalization solutions, a marketplace operator can automatically schedule communications to fit each person’s needs. Eduardo could receive messages during weekday evenings at 6pm, while another individual could receive messages when they’re most likely to engage, like during their lunch hour.
Optimizing message content and timing are only two parts of the equation when it comes to closing transactions within the marketplace ecosystem. There’s still the fact that only 23.1% of purchases are made in a timely manner. Just think about how many potential sales your sellers are losing from cart abandonment.
Cart abandonment messages have been a staple of e-commerce for decades, and while they help to recover some sales, when a customer receives a notice for an item they already purchased, or for an item they abandoned weeks ago, it’s bound to cause frustration.
Extreme personalization changes things quite a bit by eliminating the issue of cart abandonment messages going out at the wrong time. By tracking user behavior down to the millisecond, and knowing the most opportune time to send the message to elicit a conversion, marketplace operators no longer have to worry about sending too many irrelevant messages that produce frustration instead of conversion.
To learn more about extreme personalization and how it can help you grow your marketplace, check out The Kahuna Blog. Simply click the button below!
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