Meanwhile, over on E-Commerce News…

Joe Lichtman is making some very valid points about personalization and e-commerce. He points to a report from Gartner that says brick-and-mortar merchandisers are personalizing inventory for their locations—’down to sizing and color choices’, and asks a rather reasonable question:

What struck me most about this report was that merchandisers in the offline world are personalizing their strategies in spite of the serious constraints working against them: supply chain complexity, marketing costs, shelf-space limitations and the like. Yet retailers are doing it. So, why do online retailers — who face none of these limitations — still struggle to present a truly personalized, dynamic shopping experience for each and every shopper?

Why indeed? He provides one answer to his query pretty much immediately:

Freed from supply chains, printing costs and shelf space limitations, online retailers’ product catalogs have ballooned. With widely expanded catalogs comes the challenge of presenting the right products and merchandising messages at the right time to each shopper.

What he could have said is, ‘Freed from supply chains, printing costs and shelf space limitations, e-commerce retailers have tried to become all things to all people.‘

The thing is, the Internet is pretty much the only place where a company can get away with trying to please everybody. Joe turns to Amazon as an example of a company that’s doing the right thing to tailor the customer experience:

Just as offline merchandisers are thinking in a customer-centric mindset, Amazon has created a complete customer-centric experience by building — in a sense — a micro-store for each and every customer… Everything about the Amazon experience is dynamic — not static — and becomes more personalized the more you shop.

Joe’s lesson is this: the only way you can please everybody is to please each person individually. A catalog of ten million items that you’re forced to wade through is not fun. A catalog of ten million items that pulls up the three items you’re likely to care about—now, that’s impressive.

What do you think? Should e-tailers be focused on delivering a dynamic, personalized experience? Or should it be up to each of us to find what we’re after?

Last week, in an article entitled Discovery: The Anti-Search, David Berkowitz described the trend towards greater integration of discovery in a user’s search experience:

Through discovery, when you read your favorite newspaper online, you’re presented with a wealth of links from around the Web that should be of interest to you, including other articles, related books or products, or video clips, whether or not you’d expect them to be directly relevant. Amazon.com does this regularly, such as when it told me that customers who bought the Black & Decker 3.4 PS550B Handsaw also bought a 5-pound bag of Haribo Gummi Bears and the movie “Borat.”

Berkowitz rightly notes that discovery can’t replace search—they’re more effective together, like hunting and gathering—but that it absolutely can enhance search, in his word, ’serendipitously’.

What a glorious word, ’serendipitously’. It fairly rolls off the tongue. What’s so beautiful about it is how it niftily combines an element of happenstance with a portion of positive fortune, and that’s exactly what Berkowitz is pointing at here: you shouldn’t just stumble on random sites, but on sites that happen to be specifically interesting to you.

In the early days of the Internet, everything was so new that it all seemed serendipitous, like the old saying that any sufficiently advanced technology is indistinguishable from magic. As we continue to grow in our experience, though, we need ever greater depth if we want to retain that wide-eyed amazement. The original Godzilla is fun to watch now, but if we want to believe in the special effects, we need Peter Jackson.

In the case of Amazon’s handsaw/Gummi Bear/Borat combination, the algorithms are working purely on historical statistics of other users. Surely, they reason, if one person bought our handsaw and then our mockumentary, someone else will be interested in the same combination. And, like those early movies, the initial results have been impressive. If Amazon doesn’t get it right, you give a giggle or ignore it and move on. If they nail it, though, you can’t believe it: “How did they know I love Gummi Bears? They must really care about me!”

They’re bound to nail it sometimes, because it’s not unusual for people to make similar purchase combinations. Surely, though, you know someone who shares your love for handtools but not much else.

This is where companies like VortexDNA come in, allowing serendipity to occur not based a single instance of external behavior, but rather on an expression of who you are. Maybe 100 people who bought the saw also bought the Gummi Bears, but only two of them share your core purpose and values. At the same time, 40 people who are aligned with who you really are bought a Donna Summers CD. VortexDNA suggests that Amazon is more likely to score a sale by suggesting Donna than by pushing the Bears.

Serendipity in search is what continues to maintain the Internet as an exciting and vibrant place of discovery. Caring about who the user is will keep it that way.