Personalizing Personalization: How to Create a Killer Interactive Experience (Part 1 of 2)
Personalization. Ad Nauseum.
Personalization. Probably one of the most overused words in business today — right after ‘Innovation’ and ‘Eco-system.’ But what does it really mean? Interestingly, consumers are often unaware of the effects of personalization, however 78% of US Internet users say personally relevant content from brands increases their purchase intent. 94% of B2B buyers chose the winning vendor because the company demonstrated a ‘stronger knowledge of their needs.’
A recent study found that brands using technology and data to personalize offers are seeing revenue increase by 6% to 10%, two to three times faster than those that don’t. The same study found that in retail, healthcare and financial services — personalization will be a game changer, with the ability to push a revenue shift of some $800 billion over the next five years — to the 15% of companies that get it right.
I think we’re are all clear on the fact that customers today want a highly customized interactive experience — but how do product and service providers really achieve that? What’s it going to take to get ‘personal’ with our customers, and be able to compete for fickle market share going forward? First, let’s define it. What exactly is ‘personalization?’
The customization we are talking about here is the practice of using unique data points and analytics to better know your customer, and altering that customer’s interactive experience accordingly. But how do you get unique data? And how do you gain the insights to drive personalized content? And, most importantly, how do you create a personalized experience across all your channels and touchpoints? Seems there may be no one right answer, but instead, lots of roads to personalization.
Personalization Pioneers
We’ve all experienced the very first forays into personalization through iTunes and Amazon — the Personalization Pioneers. You know, when iTunes offers up a recommendation and it becomes your new favorite song or when Amazon suggests just the right chair. “The economic realities associated with the level of interactive intimacy we see out of I-tunes and Amazon are hard to ignore.’, explains Robert Juarez, Senior Management Consultant with IBM.
“In a recent trial, iTunes found that users who received recommendations based on their personal history purchased 202% more songs from 164% more artists than a controlled group. At Amazon, the ability to pinpoint their exact target audience and personalize their experience has proven to increase both visitor engagement and ultimately revenue. In fact, more than 30% of Amazon’s revenue is attributed to personal recommendations.”
Once You Get Started
70% of retailers in North America considered customer identification and the personalization of the customer experience a leading engagement priority for 2017. But where do C-suite executives begin? Most agree it starts with data strategy. Recent research from Altimeter shows the integral importance of having an exceptional variety of data sources to create personalized and targeted content. At 65% and 63%, respectively, social media metrics and website analytics were the top two data sources used by content strategists surveyed in North America and Western Europe. About half also said they used data from customer service records and customer surveys for personalization.
Data scientists often describe two categories of data required for accurate personalization: descriptive and behavioral. Descriptive data- the common table stakes — includes basic demographic information about who the buyer is — the customer’s name, title, company name, location, email address, telephone number, relationships to other customer, and more. Behavioral data create the insights about the customer that matter most to marketers — what do we know about customer lives, how have they reacted to marketing materials — what pieces of content were downloaded, what was the journey of the customer on the website etc. A survey of US marketers by Demand Metric found that 41% of respondents used descriptive data and 39% used behavioral data as personalization tactics.
So then, it is the careful interweaving of a plethora of information that will deliver best in class personalization. Technical capabilities must include a well-structured data repository & complimentary data analytics that allow an organization to capture a 360-degree profile of customers. Social listening and other tools to capture data and event detection as well as triggers to help influence how to maximize contact points are all necessary for continually improving customization. But what’s the end goal? Once you have all this information, and the technology to use it — how do you create a different experience for each and every customer?
To read more about personalization, the end user, and how to create interactive experiences — read part 2!
