Sephora, JustFab and Walmart topped the list of 100 retailers for the best personalization and customer experience. According to experience management platform Sailthru's first annual Retail Personalization Index, Sephora ranked first, with a 79, followed by JustFab, 72, and Walmart, with 69 points. Other retailers scoring above a 60 include Net-a-Porter, 64; eBay, 62; Nordstrom, 62; and REI, 62.
Monica Deretich, vice president of marketing and CRM at JustFab, says that personalization has been a core focus of the business model since the company's founding in 2010 and is responsible for an annual growth of 124%.
Looking at the results of the survey, it seems that customer experience and personalization are inseparable in that a high-quality customer experience is one that is likely to be personalized and vice versa.
However, even the top brands failed to score more than 79 out of 100 points, proving that better customer experience is still possible as brands look to strengthen the experience across all touchpoints.
So what are these three retailers and others that made the top 10 doing differently?
Their approach to personalization at both the macro and micro level are different, says Jason Grunberg, vice president of marketing at Sailthru.
"For these retailers, personalization is truly a part of their core business strategy. This means that they have a plan for continued evolution of their approach and for increasing the sophistication of their approach quarter over quarter," Grunberg told FierceRetail.
But in order to make this a focus, a brand needs a consistent stream of people and technology resources, and the corporation has buy-in from the C-suite, and marketing departments down to product and support services, business intelligence and technology.
"It’s this approach that creates a noticeable difference in the tactical execution of personalization. These are brands that are using personalization to connect the experience across their key channels, rather than simply executing on in-channel optimization strategies," he added.
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Most of the brands on the top 10 have digital and physical stores. And, therefore, these brands have gone out of their way to make the digital experience similar to the in-store experience. And these brands know that connecting online and in-store experiences is one goal, rather than treating these as two separate experiences.
"The role that in-store plays today is largely still about convenience—the ability to walk in and get what you want—but we see many brands working to use personalization to drive customers to store through digital channels by offering premium, personalized experiences over the ability to simply transact," Grunberg said.
Moving forward, more retailers will have to focus on the long-term gains over how to drive conversions today. But Grunberg says this goal can be daunting as the quarterly earnings still need to be met and retailers need to bring in revenue. Often retailers mistakenly make decisions that are focused on what brings in revenue rather than thinking about how to improve the customer experience, which increases the lifetime value of a consumer.
Still, many retailers are not yet far along in this personalization journey.
"Most have yet to tap into the potential of what’s possible and when you consider the leg up that Amazon has on so many retailers in terms of logistics, pricing, scale and loyalty, that other retailers are not fully invested in personalization to gain edge through their customer experience is just missed opportunity and poses potential, significant risk," Grunberg said.