The Evolution of Personalization: Approaching a Single View of Your Customer
Personalization is one of the hottest buzzwords in marketing right now, with many customers holding personalized experiences in higher regard than even product or price. Customers want to be treated as individuals and seek out brands that can provide those kinds of services.
The numbers agree as well, with 47% of marketers saying individual-level personalized email has a positive impact on open and click-through rates as well as a 20% lift in sales. Customers today can see straight through old fashioned marketing techniques and react poorly to them. They want tangible and actionable communications that offer them real value. Personalization achieves this. However, many ecommerce brands are still not using personalization to its fullest potential.
As we move through 2020, it's probably a good idea to take stock of the state of personalization and where we see it heading as the year progresses.
Your smartphone — whether Android or iPhone — can learn your daily routine and provide you with salient information — such as warning of any traffic issues on your commute — to help your day run more smoothly. Uber will remember not just your home address but also your regular destinations, enabling you to book journeys with ease. Dominos will allow you to order your regular pizza using your usual payment details, sending it to your home address with a single click.
Looking at these examples, it's easy to see how personalization has evolved beyond email blasts with the customer's name at the top. Personalization is now about adopting a single view of the customer and understand the services your brand can add that will make their lives easier.
However, not every company is able to achieve this. The personalized experience does not align with how an organization is normally structured. Channels are separated and departments are specialized into competence areas with profit and loss, separate performance indicators, and individual strategies. However, the greatest obstacle for most lies in the integration and creating interconnected IT infrastructure where data can flow seamlessly between systems.
And IT is the key piece of this puzzle. Technology makes the difference between the personalization we have become used to — such as email — and the next stage of the concept: hyper personalization.
Whereas regular personalization uses customer profiling techniques to make assumptions about users based on specific traits, hyper personalization takes this a step further. Hyper personalization will add in other factors such as locations purchases are made from, mode of purchase, customer demographics, and keywords the customer has searched for in the past.
Hyper personalization adds many other data points into the mix to help retailers get a much clearer picture of the customer. This helps them suggest the right things at the right time, increasing the chance of making additional sales.
Hyper personalization uses advanced digital technology such as AI and machine learning, which can crunch data faster and with significantly more accuracy than a human operator.
"Applying AI to customer data could well be today's biggest opportunity for marketers to gain a competitive advantage through personalization," writes Salesforce. "Marketing adoption of AI has grown by 44% in two years — but still less than a third of organizations are using it. Today, addressing a customer by their name no longer counts as a personalized experience. 62% now expect companies to proactively anticipate their needs, and 88% are happy to share their data in return for relevant, personalized offers. Even in B2B settings, 69% of business buyers want an 'Amazon-like' experience, with personalized recommendations."
Data helps you create a single, unified view of the customer and AI tells you what the customer needs from you next. All that remains from there is to deliver the right message, via the appropriate channel, at the right time. Unfortunately, this isn't as easy as it sounds. Many marketers list real-time engagement as a top priority and a major challenge that requires the ability to connect your data to your customer-facing systems.
Personalization and hyper personalization will continue to grow in importance as we progress through the third decade of the 21st century. If your brand has yet to seize on the opportunities of tech-driven personalization, now is the time to strike.
Personalization is sure to be a hot topic at eTail Europe 2020, taking place in June at the Queen Elizabeth II Conference Centre, London.
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