Drive Conversions: How Recommendation Engines Revolutionise Online Retail

“Personalisation” It has been a catchword for years now; every brand seems to talk about it, but not everyone gets it right. In 2025, the conversation around personalised recommendations with product recommendation engines is louder than ever, especially in the online retail world. While giants like Amazon and Alibaba have nailed it by weaving personalisation into every part of the customer journey, many retailers are still behind the game. Some haven’t even started, and others are doing it half-heartedly, leading to disappointing shopping experiences.

Table of Contents

The truth? Shoppers today don’t want to scroll through hundreds of random products. They expect brands to understand their tastes, style preferences, and needs. In fact, according to Instapage, 74% of customers feel frustrated when a website doesn’t offer content personalised for them.

So, what does effective personalisation really look like in online retail? And how can brands use recommendation engines to make it happen? This blog breaks it down, covering the entire system, how these engines work, the types, the steps to implement them the right way and last but not least, an exclusive list of the best engines for your e-commerce business.

What are recommendation engines?

A smart system or tool that assists companies in offering product recommendations to the right people at the right time. They work behind the scenes using data, like what you’ve browsed, purchased, or liked, to show you things you’re more likely to be interested in. You’ll see them in action on websites, apps, and even emails, where they personalise what’s shown to each user. It’s pretty much like a personal digital assistant that works to understand your preferences. These systems make recommendations that genuinely feel relevant, resulting in a more personalised and captivating experience while shopping online, streaming, or browsing for educational purposes.

How do these recommendation engines work?

Recommendation engines work by learning what users like and then making smart guesses about what they might want next. Basically, it is a recommender system that predicts how much a user would like any product, even before they’ve rated it. These functions are performed by powerful algorithms that can handle huge product catalogues and adapt in real time based on who’s browsing what.

Such engines usually work in four main stages:

Collection: It gathers data, either explicitly (like ratings and reviews) or implicitly (clicks, purchases, and cart activity)
Storage: Depending on the type and volume of data, it’s stored using SQL, NoSQL, or other flexible systems.
Analysis: The system then examines patterns using methods like real-time analysis or batch analysis to find trends and similarities.
Filtering: Finally, it filters all that data using selected algorithms to offer the most relevant recommendations.

This process in the background is what helps brands personalise shopping experiences, boost engagement, and increase sales.

The Psychology behind Personalised Recommendations

Ever noticed how you’re more likely to trust a brand that gets your taste?

That’s the power of personalised recommendations. At the core of it is a simple human need – to feel understood. When a brand remembers what you like and makes relevant suggestions, it feels less like a generic ad and more like a helping hand.

It’s not just about convenience but about making a connection with the user. As a product recommendation engine learns more about a shopper’s habits, the suggestions become more accurate and useful. It feels like the brand is paying attention, and that builds loyalty over time.

There’s psychology behind it, too. As per Fogg’s Behaviour Model, when something seems easy to do and motivation is high, people are more likely to act. A personalised recommendation system for eCommerce minimises the effort needed to find the right product, so shoppers naturally engage more, whether that’s adding items to their cart or just spending more time browsing similar products. Simply put, when shopping feels easier and more relevant, people are more likely to stick around.

Types of Product recommendation engines in e-commerce:

1. Content-based filtering

This concept works by matching what you like with similar options. It looks at a product’s details, such as genre, features, or keywords, and compares them with your past preferences to suggest something similar.

Let’s say you love watching “Mission Impossible”; The system picks up on that and starts recommending other action-packed movies or films starring Tom Cruise, assuming you might enjoy those too.

Simply stated, if you liked one thing, you’ll probably like something similar. Quite like a friend saying, “Hey, since you liked that movie, you might enjoy this one too.” This method implies how information is organised and filtered online, helping users discover more of what they already love.

2. Collaborative filtering

With collaborative filtering, users get recommendations from people who share the same tastes. It looks at user behaviours like ‘what people watch, buy, or enjoy’ and finds patterns among users with similar preferences. Then, it suggests things you might like based on what similar users have liked.

For example, if user X enjoys Badminton, Tennis and Golf and user Y prefers Badminton, Tennis and Hockey, the system sees it as a match. So it might recommend Golf to user Y and Hockey to user X, presuming they’ll enjoy what the other user liked.

There are two common types of collaborative filtering methods:

Item-item collaborative filtering
User-user collaborative filtering

One of the biggest perks of this method is that it can recommend complex things like movies and gadgets quite accurately, even without the need to “know” the product itself.

3. Hybrid Recommendation Systems

As the name suggests, this product recommendation engine combines diverse algorithms to give users smarter and more accurate suggestions. Instead of relying on just one method, it combines techniques, like collaborative and content-based filtering, to recommend a broad range of products.

The biggest and classic example is Netflix. Here’s how:
– It compares what you’ve watched or searched for with similar users (collaborative filtering in action).
– At the same time, it recommends shows or movies that are similar to ones you’ve highly liked or rated (content-based filtering in action).

By merging both approaches, hybrid recommendation systems can offer finer, more personalised suggestions. They’re also great at solving common recommendation issues, like the cold start problem (when there’s not enough data on a new user or product) or gaps in data.

The result? More relevant picks, fewer misses, and a better user experience overall.

Use cases of recommendation engines in online retail

If you’re looking to kickstart your product recommendations or enhance your current strategy, explore these use cases.

1. Similar Products

These ecommerce recommendation engines show products related to what the customer is currently viewing based on its name, description and tags. It’s an effective way to guide customers toward similar options that might better suit their needs, especially for brands with frequently updated inventories. Perfect for shoppers in the research phase.

2. Best-selling/Trending

This strategy highlights your most popular products, such as best-sellers or highly viewed items. It’s effective because it leverages social proof; people tend to trust what others are buying. Adding urgency with messages like “Limited stock” and star ratings boosts credibility and encourages faster purchases.

3. New Arrivals

Showing off your latest products plays into shoppers’ love for what’s new and next, especially in trend-driven spaces like fashion or tech. Highlighting “New Arrivals” on your homepage, category pages, or emails builds excitement, sparks curiosity, and nudges early exploration during the research phase of their journey.

4. Frequently Browsed

Showing products a shopper (or similar shoppers) has previously viewed encourages them to revisit items they’re already interested in. It’s a gentle reminder that works well on homepages, emails, or SMS, especially for re-engaging distracted buyers or nudging repeat purchases.

5. Related Products / You May Also Like

This strategy shows items you’ve manually grouped as related, perfect for curated cross-sells and upsells. It’s also great for multi-brand stores, helping shoppers discover complementary products across categories and boosting AOV during the purchase stage of their journey.

Key steps in implementing product recommendation engines for retail

Building a great product suggestion engine takes more than just data, it requires the right steps and a clear understanding of the challenges. Here’s what it takes to get it right, along with the challenges to watch out for:

Step 1: Gathering and Understanding Customer Data

By tracking things like what customers browse, buy, or click on, businesses can spot patterns in behavior and preferences. This helps them understand what people are interested in and offer more relevant and personalised experiences.

Step 2: Creating Smarter Customer Segments

You can group your customers based on things like their shopping habits, age, or past purchases. This makes it easier to send more relevant suggestions or offers to each group, so your messaging feels more personal and connects better with different kinds of shoppers.

Step 3: Delivering personalised Experiences

Retailers can keep shoppers interested by showing products and content that match what they’re doing right now. By staying in tune with their changing preferences, you can make sure every recommendation feels timely, personal, and more likely to lead to a purchase.

Step 4: Testing and Optimising with Experiments

Running A/B tests lets retailers try out different recommendation styles to see what works best. By comparing results, they can determine which approach better connects with their audience and drop the ones that don’t, leading to smarter and more effective personalization.

Step 5: Giving Customers Transparency and Control

Building trust with customers means giving them control. Let them choose how their data is used and how much personalisation they’re comfortable with. It’s important to personalise smartly, without making people feel like their privacy is being compromised or they’re being watched too closely.

Step 6: Constantly Learning and Improving

Customer preferences don’t stay the same, so your recommendation engine shouldn’t either. Keep checking how it’s performing, look at what’s working (and what’s not), and tweak your algorithms regularly. Staying updated with shifting behaviours helps you stay relevant and keeps the customer experience smooth and personal.

Best recommendation engines for e-commerce

Here are the top recommendation engines that can help enterprise commerce businesses and online retailers enhance customer experience, boost conversions, and drive sales with personalised, data-driven product suggestions!

1. Verbolia

Verbolia boosts engagement and conversions by offering intelligent product recommendations tailored specifically for both product and category pages. Whether traffic comes from Google Ads or organic search, its algorithm shows the most relevant items to each visitor, leading to lower bounce rates and stronger cross-sell and upsell performance.

2. Bloomreach

Bloomreach uses your product and visitor data, along with search intent, to recommend the right products to each shopper. It’s easy to set up, with built-in algorithms for frequently bought or viewed items, similar products, bestsellers, and trending picks. It also supports automated email campaigns based on user behaviour to keep customers engaged beyond the site.

3. Clerk

Clerk is a plug-and-play tool that helps you set up smart product recommendations using prebuilt algorithms, such as order history or category bestsellers. It updates suggestions automatically based on trends and seasons, so they always stay relevant. You can place these recommendations anywhere, from the homepage to product pages, pop-ups, and even during checkout.

4. Emarsys

Predict by Emarsys is a recommendation engine that uses a JavaScript API to track how customers interact with your site. It then turns that data into personalised product suggestions across email, mobile, and web platforms. It also recognises users across different channels, helping you create a more connected, personalised shopping experience with a full view of each customer.

5. Nosto

Nosto uses a smart mix of behavioural, transactional, and visual AI data to deliver spot-on eCommerce product recommendations. Its built-in merchandising rules and smooth integration with Nosto’s Segmentation tool let you tailor strategies for different customer segments, helping you show the right products to the right people at the right time.

6. Qubit

Qubit is a flexible e-commerce tool that’s evolved from simple tag management to a full suite of features aimed at driving more conversions and revenue. It offers everything from personalisation and predictive analytics to A/B testing, segmentation, and customer insights, making it a smart pick for data-driven growth.

Conclusion

In summary, recommendation engines have become a game-changer for online businesses today. But for them to truly work well, they need to connect the dots between products, customer behaviour, inventory, delivery timelines, and even social media trends. When done right, recommendation engines can do much more than boost sales. They also build customer trust and loyalty.