This blog is part two in a five-part series on product personalization. To read the full resource guide “5 Reasons Why You Should Offer Product Personalization”.
So you’re still on the fence about personalization. Sure, that’s understandable, especially when you think about all of the things it entails to make it run smoothly. But adding product personalization as an option on your ecommerce site is an excellent way for retailers to create an additional revenue stream that also improves customer satisfaction.
There are a variety of ways that online retailers can position personalization to make money. The most common method is simply to charge an additional fee for any customization, but that doesn’t work for every customer base. If your shoppers are cost-conscious or skeptical of value-add services, consider offering it ‘free’ on high-margin items or only over a certain purchase amount to ensure you’re at least covering your costs. (Then, of course, there’s that whole “it will increase your sales, make customers more loyal, and encourage repeat buyers” thing, which certainly helps build more revenue!)
Yes, adding services to your repertoire can be costly at first, but if you implement customization correctly, it will pay itself off in dividends in the long run. Here’s how to make it work:
- Figure out what pricing strategy works best for your personalization services. Consider your average order value, consider testing different offers, and see what your competition is doing.
- Make it a fulfillment initiative – doing your personalization in-house eliminates long lead times, shipping and handling costs, and the likelihood of errors.
- Find a trusted provider if you don’t want to worry about employee training, acquiring machines and supplies, and dedicating space to your personalization services.
Is product personalization making you see red or raking in green? If it’s the first one, you might have a problem.