95-5 is the New Normal in eCommerce Experience Management

Sep 25, 2016

Vilfredo Pareto famously implied that “80 percent of the effects come from 20 percent of the causes;” or, put in other words, a small percentage of causes drives a disproportionately large percentage of the effects. eCommerce marketers have widely accepted Pareto’s assertion, focusing optimization and marketing efforts on the 20% of their user base responsible for approximately 80% of their revenues.

However, in today’s eCommerce environment, we are witnessing a new and even more drastic “Pareto Principle” emerge: less than 5% of a site’s visitors are now driving more than 90% of revenue.

Marketers can no longer optimize according to how they think the ‘average visitor’ is going to interact with their sites, or even how a large segment of users will. Instead, the approach needs to be reframed: sites need to be optimized to emphasize conversions from that crucial 5% of visitors who contribute most to their site’s KPIs.

The question we all want answered is: how can it be done?

In this very practical article originally published in Marketing Land, Dynamic Yield’s CEO Liad Agmon explains how marketers can leverage machine learning optimization and micro-segmentation to identify and engage their most valuable consumers on a 1:1 level and drive them toward purchase and conversion.

By using affinity-based personalization to present products that each segmented customer is most likely to engage with, you will ensure you are investing your time creating valuable experiences for valuable consumers, and not for average ones.

Click here to read: How the ‘average user’ has ruined eCommerce experiences

Dynamic Yield: Unified Customer Engagement Platform
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