As 2012 comes to a close, I have reached out to top technologists working on personalization solutions and technologies. I want to hear where they think the industry is headed, and how 2012 has advanced the art and science of personalization.
Junko Nishimura is a COO and co-founder of Silver Egg Technology. Her blog is in Japanese.
Silver Egg Technology is the first company in Japan to specialize in recommendation technology. Its service is used by top ecommerce sites in Japan.
Question: How has the recommender systems market in Japan changed in 2012?
Recommender systems have become an integral part of EC sales in Japan. Almost all major sites with more than a few dozen products now offer some form of item recommendation. Because it is more cost-effective, most sites use third-party, SaaS recommendation services.
There haven’t been any recent market studies, but our view is that the Japanese market for recommendation services is still growing. However, the economy is sluggish. Some new recommendation services launched in the past few years have struggled — and a few have refocused on niche markets or moved on to related markets such as big data, or social-networks.
Question: What are your proudest accomplishments for 2012?
We successfully launched two services based on our integrated technology platform;
a retargeting ad service and a personalized landing page optimization service.
Question: What part will recommender systems play in enabling an increasingly personalized customer experience?
The best sites offer customers multiple, complementary ways to explore the product offering. Each is, in some sense, a form of recommendation. It is all about providing choices — allowing different kinds of customers, with different needs and interests, to experience the products in different ways. On sites that understand this, recommendations are not a sideshow, they are the main sact.
Question: What does the future hold for recommender systems and personalization?
We have only seen the tip of the iceberg. Today we have islands of optimization. Recommendations are not well coordinated with advertising campaigns and landing pages, and powerful signals from consumers are being ignored. The process of driving traffic, providing personalized web visits, and reaching-out to offline customers should be managed in a thoroughly integrated, quantitative, closed-loop fashion. There is money on the table for companies that have the tools, techniques, and wherewithal to pull this information together. When they do, a web page showing a few item recommendations in a box will seem quaint. In a few short years, most sites will offer innovative, personalized item navigators powered by deep knowledge models of individual customer interests.