As the pandemic winds down in many parts of the world, brands are taking stock of which pandemic-related changes will stay and which will fade.
Digital commerce might be slowing down as a consequence of recession fears, but customers aren't going back to their pre-2020 shopping habits. As of May 2022, more than half of US adults say they shop online at least once a week. Clearly, there's still no better growth investment than digital channels.
Customers also expect a great deal more from brands than before the pandemic. Now, 73% of customers—consumer and business—say they expect companies to understand their "unique needs and expectations," and 56% expect all offers to be personalized (linked report is gated content).
Personalization is now a marketing buzzword because it allows brands and organizations to deliver highly relevant and engaging experiences to their customers, creating a best-in-class user experience. But how can companies get started with personalization, and what are the key ingredients needed to create a successful personalization strategy?
Defining Personalization Beyond the Basics
Nearly everyone understands the idea driving personalization: Take what you know about a customer or segment, and deliver the right content (such as an ad, offer, or experience) that encourages that customer or segment to take action (such as clicking a link or making a purchase).
However, many factors complicate personalization efforts.
In marketing, personalization can be as simple as "Hi [insert customer name]" or as complex as a fully customized, individually curated experience that adapts as customers' needs change, including moving to new channels. Because personalization can manifest in so many ways, and because it can serve near-term conversion goals and longer-term relationship building alike, it can be difficult for marketers and CX teams to decide where to start.
As a result, many brands personalize one-off interactions, such as using the customer's first name in a marketing email or showing them a targeted ad. For more complex use cases, the kind that build brand loyalty over time, you have to analyze customer behavior across multiple touchpoints to predict their next steps and then take complex, real-time actions based on that predictive analysis. Often, that is where brands stumble.
Understanding Complex Personalization Requirements
Personalization requires marketers with a vision who can design the strategy and processes to their personalization program.
What does a personalization vision look like? It includes both short-term and long-term pathways to goals, starting from the way customers naturally interact with your brand. Once you understand that, you can begin to design personalized experiences based on what you want the personalized customer experience to look like.
To start, companies must figure out how their customers want to interact with their brand through every channel at every interaction. That requires a deep understanding of customer preferences, behaviors, and needs, as well as the ability to deliver relevant, meaningful experiences across multiple channels.
For example, a customer may interact with a brand through social media, email, and in-store. Each channel provides an opportunity to create a personalized experience but requires a different approach. Social media may be better suited for engaging customers in a two-way conversation, whereas email may be more effective for delivering personalized offers and promotions.
To meet complex personalization requirements, companies must invest in advanced technology capabilities, such as a customer data platform (CDP), digital experience platform (DXP), data orchestration, and analytics tools. Such tools allow companies to collect and integrate customer data from multiple sources, create detailed customer profiles, and deliver personalized experiences across multiple channels.
Personalization also requires you to define the KPIs that matter to your organization and to understand what level of improvement is realistic in light of your competitors and current personalization capabilities.
In most cases, conversion is the KPI brands want to improve, so they'll need to develop a list of personalization use cases that can drive it. Then, it's important to think through each use case to define the pathways and data analysis required to make it happen. That helps brands clarify their options and start working toward a unified, consistent personalization strategy.
Putting Advanced Personalization Into Practice
Once a company has a deep understanding of its customer needs and has the right technology capabilities in place, it's time to put advanced personalization into practice. Here are some practical steps companies can take to make that happen:
- Start small. Don't try to personalize the entire customer journey all at once. Start with a small use case and then incrementally deliver value. For example, start by personalizing emails or product recommendations, then expand to other channels.
- Use customer data to create detailed profiles. Collect and integrate data from multiple sources to create a granular understanding of customer preferences, behaviors, and needs. Use those to create personalized experiences at every touchpoint.
- Create relevant, valuable experiences. Use customer insights to create experiences that meet customers' specific needs and add value to their journey. Don't personalize just for the sake of personalization.
- Use advanced technology. Use a CDP, DXP, and other tech capabilities to automatically collect, integrate, and deliver personalized experiences across multiple channels.
- Measure and optimize your personalization efforts. Use analytics to measure the impact of personalization efforts and optimize them for better results over time.
Eventually, personalization can make your customers feel that you're anticipating their needs. For example, a hotel chain that connects local weather forecast data to its customer loyalty and reservation data can deliver thoughtful, useful perks, such as delivering umbrellas to loyalty members' rooms before check-in if it's going to rain during their stay. When guests know the hotel can anticipate their needs and deliver without being asked, they're more likely to stay there again.
The same principle of anticipating needs applies to B2B. For example, an auto parts manufacturer can create a personalized ordering portal for its automaker customers that uses product, inventory, user, order history, and other types of data to personalize the ordering experience. Each customer can see customized catalog views, order templates, and real-time pricing and availability information relevant to their needs. That kind of portal can also provide customized order tracking, workflows, and support features.
By using data and technology to create a tailored and seamless experience for the automaker, the car parts manufacturer can strengthen customer relationships and drive repeat business.
* * *
It takes a lot of effort and commitment to get beyond the first-name-in-the-email stage of personalization, but the results can feel almost magical to your customers.
By starting with a vision, gathering the right customer data, and selecting the right use cases, CX teams, and technology, brands can start building personalization programs that cut through the complexity and deliver experiences that simplify and enhance their customers' lives.
More Resources on Personalization Strategy
Know someone who would enjoy it too? Share with your friends, free of charge, no sign up required! Simply share this link, and they will get instant access…
You may like these other MarketingProfs articles related to Marketing Strategy:
- Market Research for B2B Marketing Success | Marketing Smarts Live Show
- Your Evolving Value Proposition: How to Recognize It and Get Ahead of Agency Competitors
- How to Harness the Power of SMS Marketing: A Guide to Best-Practices
- The State of Digital Marketing for the Manufacturing Industry [Infographic]
- How B2B Marketers Can Shift to Buying Groups in Three Months or Less
- Direct Mail Marketing's Top Advantages and Challenges