Top 4 Best Practices for eCommerce Merchandising

What is eCommerce Merchandising?

eCommerce merchandising replicates some of the techniques that visual merchandising employs in physical stores, but with a focus on optimizing online shopping experiences for customers. It uses layout, color, visuals including images, video, and 3D models, and branding elements to create a subtle aesthetic that compels shoppers to buy. 

eCommerce merchandising also uses behind-the-scenes strategies powered by technology. This is the magic that users can’t see and includes personalization, data analysis, and customer journey orchestration to get shoppers to add items to their cart and complete a sale. It’s a method of online selling that’s hyper-focused on capturing your customers’ attention and converting browsers to buyers.

Why is eCommerce Merchandising Important?

Good experience, in an eCommerce setting, is all about relevance. eCommerce merchandising makes an online shopping excursion relevant by promoting the right products to the right shopper, regardless of how they’re shopping—your app, your website, and on their device of choice. 

According to Retail Dive, 54% of consumers prefer shopping in physical stores that create engaging experiences. eCommerce merchandising is important for these consumers, and to any shopper who ends up on your website or app, because it’s what makes online shopping experiences as engaging as in-person experiences. As the retail buying experience grows more complex, consumers are growing more demanding. 

A 2023 Synchrony poll found that 80% of consumers expect to have curated shopping experiences—experiences crafted just for them—by 2030. That’s a tall order, but with technology that personalizes your eCommerce merchandising approach, it’s a demand that you can absolutely fulfill.

4 Proven Strategies for Successful eCommerce Merchandising

The best strategies for eCommerce merchandising focus on presenting and promoting products in a compelling way. They enhance a shopper’s buying journey by evoking emotion, inspiring demand, and driving action. 

The eCommerce merchandising best practices that achieve all these things employ data and personalization and include:  

#1: Data-Driven Product Recommendations

When you recommend products based on user signals like real-time visitor behavior, historical data, and third-party information, shoppers respond. Customer data is the starting point here. Personalization engines like Monetate combine recommendation algorithms with data to present product recommendations in the context of a shopper’s buying journey.

Dynamic and machine-driven recommendations are proven ways to increase important metrics like Revenue per Session (RPS). That was the case with Norwegian retailer Helly Hansen. After incorporating personalized recommendations into their eCommerce merchandising strategy, Helly Hansen achieved 100% increase in RPS on product detail pages where they employed dynamic tests.

#2: Personalized Marketing and Promotions

Adapting to shoppers as they move through a given buying journey is an important part of providing a good eCommerce merchandising experience. 

What this means, in practice, is that you recognize customers as they bounce from a desktop to a smartphone to a tablet and back again. Sending relevant promotions and customizing content based on this behavior both personalizes and streamlines a multi-touchpoint, multi-channel shopping experience. 

This extends to touchpoints that live outside of your owned channels like your website and app. Cart recovery emails connected to social media ads are examples of this. The journey might look like this: a mobile shopper clicks on your Facebook ad and lands on your website. They add a few items to their shopping cart, then they put down their phone without completing the sale. Later, they log into their laptop to check their email and discover a cart reminder email from you titled, “Your items are waiting for you.” 

#3: Personalized Pricing 

Dynamic pricing is an eCommerce merchandising technique that uses internal and external data to automatically change prices based on factors occurring in real time. Marking items down as seasons shift, increasing pricing based on increased demand, and undercutting competitors’ prices in real-time are examples of how retailers use dynamic pricing to personalize shoppers’ in-session experiences.

Dynamic pricing is a compelling way to optimize sales, but it can also be a money loser if margins are too low. Data and technology are once again the catalysts for making this strategy as effective as possible. A platform like Monetate that processes large amounts of data from multiple sources can make intelligent decisions about dynamic pricing, optimizing pricing strategies, and ensure you don’t lose money with a personalized pricing approach.

#4: Personalized Customer Journeys

The 2023 customer buying journey is an omnichannel one, meaning that consumers are navigating a single purchase via a blend of online and offline spaces. This looks different for different customers – it could include a few of the following sample journeys:

• Scanning a QR code in a store to get product information, then buying that item online. 
• Researching a car on a dealer’s website, going to the dealer for a test drive, then purchasing the car on the dealer’s app. 
• Ordering groceries from a supermarket’s app, then picking them up in the store.

According to BCG, “Each physical, digital, or increasingly augmented and virtual interaction will serve as the outer face of an interconnected network.” This network of connections creates a wealth of data that retailers can leverage to personalize customer journeys across various touchpoints and channels. Technology plays a crucial role in making this possible as do analytics.

Implementing eCommerce Merchandising & Measuring Success

Achieving personalized eCommerce merchandising in an enterprise environment requires the right tools and expertise. Technology is the backbone that enables you to personalize your customers’ experiences, assuming it includes the features you  need for the job. 

A personalization platform like Monetate includes product discovery tools that use AI and ML to make product recommendations, fuel personalized search, and connect customers to relevant products based on what platform, device, and channel they’re using.

Monetate also helps you measure success by monitoring KPIs like conversion rates and average order value, then automatically optimizing experiences to ensure every shopper gets the most optimized and personalized experience possible.

Interested in learning more about how Monetate’s personalization engine can improve and empower your eCommerce merchandising approach? Schedule a demo today.

eCommerce Merchandising FAQs

eCommerce and retail merchandising, while sharing a core objective of promoting products to consumers, differ significantly in their approach and mediums. In this FAQ section, we address some common questions about eCommerce merchandising.

What is the difference between eCommerce merchandising and retail merchandising?

eCommerce merchandising refers to strategies used in online stores to promote products and guide buyers through their shopping journey. This often involves personalized product recommendations, search engine optimization, dynamic pricing, and other digital tactics. Retail merchandising, on the other hand, focuses on the in-store presentation of products. This includes the layout of the store, product displays, signage, and the strategic placement of items to encourage purchases in a physical environment.

What are the 4 main elements in visual merchandising?

The four main elements in visual merchandising are:

1. Display and Presentation: How products are showcased, which could be through window displays, mannequins, or shelves.
2. Signage and Graphics: Informational and promotional signs that guide and entice the shopper.
3. Lighting: Proper lighting not only makes products more appealing but also guides customers’ attention to particular areas or products.
4. Space and Design: The overall layout of the store, including product placement, traffic flow, and the aesthetics of the space itself.

What is an example of personalization and customization in eCommerce?

In eCommerce, personalization involves tailoring the shopping experience to individual users based on their preferences and behavior. For instance, Monetate’s Automated Personalization engine delivers 1-to-1 personalization by showing each visitor a tailored experience based on comprehensive data. This is achieved through leveraging machine learning and AI to continuously optimize towards specific goals, such as increasing conversion or reducing bounce rates.

On the other hand, customization allows customers to modify product features or configurations. An example might be a shoe brand allowing shoppers to choose specific colors or designs. By integrating both personalization and customization, eCommerce platforms can offer a truly unique and engaging shopping experience.

Why is personalization important in eCommerce business?

Personalization enhances the online shopping experience by making it more relevant and tailored to each individual user. By personalizing content, eCommerce businesses can:

1. Increase Conversion Rates: Personalized product recommendations or offers can lead to more purchases.
2. Boost Customer Loyalty: When users feel understood and catered to, they’re more likely to return to the same e-commerce platform.
3. Enhance User Engagement: Personalized content, whether it’s product suggestions, emails, or promotional offers, grabs users’ attention and keeps them engaged longer.
4. Achieve Higher Order Values: When recommendations align with user preferences, they’re more likely to make additional or higher-value purchases.

By creating a shopping experience that feels tailor-made for the individual, e-commerce platforms can differentiate themselves in a crowded market and foster a deeper connection with their customers.