When Google stepped in last week with its new Retail Search product, it put a spotlight on the retail industry’s abandonment issues, wherein U.S. merchants lose out on $300 billion in sales because consumers can’t find what they’re searching for.
But that’s only the tip of the iceberg: Shopping cart abandonment, where a customer places an item in a virtual cart but never checks out, impacts 75 percent of purchases globally and can cost merchants about $4 trillion each year.
Google isn’t the only one focusing on this issue: Smaller companies, such as retail software provider Fast Simon, are also trying to optimize the shopping experience for both merchants and consumers in order to boost conversion rates and increase average order values.
“Getting traffic to the store and keeping that traffic is hard,” Zohar Gilad, CEO of Fast Simon, told PYMNTS. “So, our job is to make sure that the merchants can get anything they can get from the traffic that comes to their store.”
And as of Tuesday (Aug. 3), retailers that use Fast Simon — which is integrated with Shopify, BigCommerce and other eCommerce platforms — have another tool in their toolbox: marketing automation platform Klaviyo. Insights from Fast Simon’s artificial intelligence (AI) software are now automatically integrated into Klaviyo workflows to help merchants create personalized recommendations for retargeting customers who abandoned their initial purchases or may be interested in purchasing additional items.
“We’re taking specific insights about shopper behavior and in-store behavior and connecting them with the email marketing to produce even better results for merchants,” Gilad told PYMNTS.
Fast Simon had previously been focused only on shopping optimization for merchants when traffic arrives at an online storefront, but Gilad said retailers began asking for integration with email marketing such as Klaviyo. “When I heard about this, I was like, ‘Hey, why didn’t I think about that,’” Gilad said. “But it’s always good that it’s coming from customers, because they have the need, and we just started working with them.”
Stewart Wesley, strategic partner manager for technology at Klaviyo, said that the integration with Fast Simon “unlocks an exciting new strategy and use case.”
“Everybody has implemented and optimized abandoned cart flow, but the concept of retargeting abandoned search is essentially brand-new,” Wesley said. “By identifying customer buying intent and sending relevant and personalized communications, Fast Simon has created a powerful new communications strategy for Klaviyo customers.”
According to eMarketer, the number of email users in the U.S. is expected to reach nearly 278 million by 2024, representing 81 percent of the population. In 2021, approximately 268 million Americans used email.
To be sure, though, email may not be where brands will find the next generation of consumers. Increasingly, the battleground is becoming social media, with social commerce projected to top $363 billion in sales this year.
Turning to Technology
Gilad previously told PYMNTS that AI could be part of the retail industry’s labor shortage, automating processes that previously required manual labor. Not only does this eliminate the need to hire someone, but it also can make the task more efficient, as AI is able to utilize data to determine how customers may react to something. Fast Simon also includes an AI retail merchandising tool, which allows merchandisers to create personalized, targeted customer experiences with drag-and-drop editors.
Retailers have also been using AI for price optimization, a crucial area that has received even more intensive focus as inflation continues to rise across the U.S. Matthew Pavich, managing director of global strategic consulting at Aptos, told PYMNTS that price perception is more important than ever, with consumers comparing prices between retailers even when shopping in-store.
“Every retailer has opportunities within price optimization,” Pavich said. “It’s just a question of finding what those opportunities are.”