June 11, 2009, 12:00 AM

When to show personalized recommendations? Right away, IRCE speaker says

New research shows that consumers prefer to see personalized recommendations on a retailer’s home page. That’s a surprise, as most web merchants show recommendations on product or shopping cart pages, says Robert Cell, CEO of MyBuys.

Most online retailers show personalized recommendations on product or shopping cart pages. But new research shows the No. 1 place where consumers would like to see personalized recommendations is on a retailer’s home page, says Robert Cell, CEO of MyBuys Inc., who will provide details of the research next week at the Internet Retailer Conference & Exhibitionin Boston.

The research also shows 76% of consumers say they are more likely to buy when they see recommendations on a site relevant to them. And 43% say they would not return to a site that shows them irrelevant recommendations. “If recommendations are poor, it actually makes the consumer scratch their heads and think, ‘What kind of site is this?’” Cell says.

The survey also tested how much information to provide when presenting recommendations. Should the site explain how it selects products to recommend, such as by saying, “People who clicked on this also bought that,” or just simply say, “These are our recommendations”? Cell says the simpler approach prevailed in the survey, as “You may also like” proved to be the most popular title for a recommendations area. “That goes counter to some people who believe you should tell consumers why you’re doing what you’re doing,” Cell says.

Cell will be presenting in a session entitled Making product recommendations work for maximum conversion with MyBuys client Erik Martinez, director of e-commerce at Peruvian Connection Ltd., an online retailer of knitwear, other apparel, accessories and home décor. Martinez says the MyBuys recommendations engine has produced a 26% lift in conversion rate both on the e-commerce site and in e-mails sent to customers.

Martinez tested MyBuys against manually generated recommendations and found the MyBuys system delivered a 25% increase in average order value and a 5-8% conversion rate boost in A/B tests. Martinez is a strong believer in such tests that pit a service under consideration against the current system. “It’s much better to do real-time, controlled A/B testing to accurately determine the value your service adds,” he says. “Every time we do that testing with MyBuys, the results prove their recommendations increase revenue.”

Peruvian Connection is No. 382 in the Internet Retailer Top 500 Guide.

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