Personalized Product Recommendation Tips and Stats

Product recommendations can literally multiply profits. 

Unfortunately, many eCommerce companies install a simple plugin and leave it at that. The truth is... not all recommendations are the same.

We've found that detailed, personal recommendations vastly outperform generic ones. To be successful, you need sophisticated product recommendation engines that are able to make sense of shopper's web behavior. 

Note: this page was updated on March 15th, 2019 to reflect the latest findings on product recommendations, and their effect on eCommerce sales. 

Personalized Product Recommendations' Effect on Average Order Value

Personalized Product Recs Increase

Personalized product recommendations dramatically increase AOV (average order value). 

Sessions that do not have any engagement with recommendations have an AOV of $44.41. 

This number multiplies by 369% when prospects engage with a single recommendation. The effect continues to climb until tapering off around 5 clicks.

It is clear that the more personalized and engaging recommendations are, the more stores benefit from larger purchase orders. 

*Note: This study went across multiple industries. The significance of this study is not the nominal amount, but the relative increase. 

Personalized Product Recommendations' Effect on Revenue

We conducted a study across 300 randomly selected customers. Here's what we found. 

Product recommendations account for up to 31% of eCommerce site revenues.

On average, customers saw 12% of their sales attributed to our product recommendation product. 

“Customers who click on a recommended product have a 70% higher purchase rate (at 10.5% versus 6.2%) within that session. That lift in purchase rates also carries over to return sessions, though it does drop some - to 55%.” - Monetate Research

Personalized Product Recommendations' Effect on Conversion Rates

Personalized Product Recommendations effect on conversion rate

We also found that product recommendations increase conversion rates

Above, we see the conversion rate of sessions increase in lock-step with their engagement.  

Again, the biggest improvement occurs at the first click. Prospects who do not engage with recommendations convert at 1.02%. That number increases 288% after a single interaction. 

Our findings fell in line with a similar study conducted by SalesForce. They found shoppers that clicked on recommendations are 4.5x more likely to add items to cart, and 4.5x more likely to complete their purchase.

Personalized Product Recommendations' Effect on Shopping Cart Abandonment

Personalized Product Recommendation Effect on Cart Abandonment

Lastly, recommendations have a significant effect on shopping cart abandonment. 

Here, we defined cart abandonment as sessions that completed a purchase divided by the total sessions that prospects added an item to their cart. We then segmented these numbers by how they engaged with recommendations in that session. 

We found that sessions that did not engage at all with recommendations, but simply added an item to their cart were much more likely to abandon their purchase. 

In fact, implementing personalized product recommendations can improve cart abandonment by up to 4.35%. 

Lastly, it is interesting to note that the effect on cart abandonment reverses after a certain level of engagement. This makes sense when you consider buyer behavior - especially those in the research phrase that use recommendations to find products.

Tips for Effective Personalized Product Recommendations 

1. Put Product Recommendations Above the Fold

Position of product recommendations influence how effective they are. We found widgets placed above the fold were almost twice as effective (1.7x) as widgets below the fold.  

2. "What Customers Ultimately Buy" Widgets were the highest performing

Out of the 20+ product recommendations types that were reviewed in this study, the most engaging recommendation type  was ‘what customers ultimately buy’.

3. Use "Best Selling" Recommendations for new visitors

When a new visitor comes to your store, you don't know what products to recommend.

The best practice is to supply the best sellers of your store toward the top. You can also consider having multiple widgets, one for each of your top categories. 

As customers engage with your site, your product recommendation engine will begin to understand what types of products this customer is interested in, and supply more personalized suggestions.

4. Personalize Product Recommendations Based on Web Behavior

Position of product recommendations influence how effective they are. We found widgets placed above the fold were almost twice as effective (1.7x) as widgets below the fold.  

5. Inject Personal Recommendations into Emails

Another great way to personalize emails is via product injections. Software like Barilliance can inject product recommendations directly into the email.

The widget is tailored to reflect the products each customer is most interested in. Below is a great example of tailoring suggestions based on gender.

Below is an infographic we built with some of the key product recommendation stats we found. 

Product Recommendation Statistics

Next Steps...

Product recommendations serve as the foundation for your eCommerce personalization strategy.

The next step to increase conversions is to build out more advanced personalization tactics.

Lastly, to see if Barilliance is the right product recommendation engine for you, schedule a brief demo with us.