Personalization: The holy grail of customer experience, and one of the most difficult tactics to master. It has become something every company attempts to achieve due to its value to customer loyalty. According to a 2016 study by Accenture, 75% of consumers are more likely to buy from a company that recognizes them by name, recommends options based on past purchases, or knows their purchase history.
A personal experience creates for a more pleasant customer experience, one that helps customers feel unique and appreciated. These experiences can also provide a more seamless experience which allows a customer to achieve their intentions quicker, wasting less of their time.
The definition of personalize is “design or produce (something); to meet someone’s individual requirements.” Keyword is individual. I often see companies’ market to cohorts of customers thinking they are providing personalization, but this is incorrect. In order to be personal, a company must know what makes each individual customer unique.
The best way to learn what makes each customer unique is to have a conversation with them and listen closely. Conversing is how people learn about one another and build a relationship; companies should be no different.
In the past, previous purchases or online engagement is what companies have used to base a customer’s individuality on. Today, with new Natural Language Processing (NLP) technologies like Topbox, companies can have these conversations and gather insights about every customer across any channel. Learning this information used to be the most challenging step. Today, that is no longer the case. Leveraging the information to create a personalized customer experience is now what’s difficult.
In order to achieve personalization, you must understand the components that formulate the tactics and where your company stands within each.
Below I cover the following three components and their relationship to personalization: Marketing, Channel Experience, and Relationship Level.
Marketing – How targeted is the personalization?
Mass Marketing – Not personalized to any cohort or individual consumer. These forms of marketing often have the greatest reach but the lowest impact. The focus here is quantity over quality (i.e. mass media, billboards, etc.).
Cohort Marketing – Tailored to a specific cohort or group of customers that have been identified based on a unique, shared attribute. This is the first step towards personalization and may feel personal to some customers (i.e. unique ads based on demographics such as location or income, promotions for customers who buy specific products, etc.).
1-to-1 Marketing – True personalization; marketing at the most granular level. In order to achieve this level of personalization, a company must know unique information about a specific customer. After all, individualized experiences can only be done by understanding who the individual is. Something to keep in mind when deploying these experiences: there’s a fine line between being personable and creepy, and that line needs to be established for every customer in the beginning.
Some examples of good 1-to-1 marketing would include: offering a product or service based on the individual’s current lifestyle or preferences, greeting them by name, or going as far as asking them how they felt about a previous product or service and why they chose you.
Channel Experience – How fluid and consistent is the personalization across channels?
Disparate – Each channel is a different experience which provides disjointed personalization. As a customer provides more information within one channel, there is no passing of information to another. This creates a frustrating and fragmented experience for the consumer.
Inconsistent – Having connected, personalized experiences across some channels. Most commonly, digital channels will have consistent experiences from one digital channel to the next (web, app), but when outside those experiences’ personalization is lost. This is a step in the right direction, but a sign that not all business functions are aligned or sharing data.
Omni – When personalization is consistent across all customer touch points. This means there is information shared across multiple business functions within a company to ensure the customer receives the most premium and personal experience.
Relationship Level – What information is used to create a personalized experience?
Simple Personalization – There are varying degrees of personalization. Simple personalization is when basic customer information is used to create a personalized experience. This is information like name, location, and any other general information that is usually public. Since this information is unique to the individual this is still considered personalization, however, the information didn’t require a relationship to acquire.
Complex Personalization – Unlike simple personalization, complex personalization is only possible with information that is derived from interacting with a customer. These are things like preferences, lifestyle, and household status (married, family, dog, etc.). This is where it’s pivotal that you have developed a solid relationship with a customer and are not overstepping your bounds with personalization. When done properly, this gives a customer the feeling a company is truly appreciative of their business.
There are many other aspects of personalization that companies may have to formulate, but at a high level, these components are relative to most. Because personalization is constantly evolving and changing, there is always a moving target – automating personalization as much as possible will help you create individualized experiences with precision and speed.
Personalization is complex due to the uniqueness of every consumer. This is what makes it so interesting and challenging. Luckily, with the power of new technologies, companies can achieve true personalization.