What is Missing in your Personalisation Strategy?
More than 50% of consumers are willing to share information on products they like in order to get personalised discounts. However, personalisation continues to be a challenge. What are brands missing?
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It’s a fast-running world, and customers won’t waste their time where there’s no personalisation. Research shows that 80% of frequent shoppers only buy from brands that personalise the experience.
Marketers have long realised that personalisation is a basic requirement for customers. In fact, it is something customers take for granted and, if not offered, is the first thing to drive them away. Why, then, do marketers continue to witness churn?
Martechvibe spoke to experts about what brands could be missing in their efforts to get the personalisation wheel running seamlessly.
What’s missing in brands’ personalisation strategies?
“Personalisation is not about looking at similar purchase patterns but solving a specific consumer problem,” said Jonathan Flender, VP of Sports at GMG. Flender made a strong point, saying that too often, simplicity is underestimated, explaining that the best technology is the one we do not notice—because it works.
According to Flender, three overlooked components will help brands drive their personalisation strategy:
- A purpose
- Accurate data
- Simplicity
Shedding light on why context is important and how simplicity plays a crucial role, he said: “The aim should be to create an experience where the customer’s needs are so well met and understood that they don’t even realise they might require anything additional.”
Brands also make the error of driving customers towards the transaction instead of understanding their common interest, says Saad Abdullah, General Manager & Marketing Director at Toyota. A lot of effort goes into personalising too much or too little, when it should really go into building an emotional connection with the customer.
Abdullah said that the two key elements missing brands’ personalisation strategies are ‘contextualising the right way’ and ‘effective customer-driven storytelling.’
A five-step plan for personalisation in CX
“Connectedness across platforms to ensure consistency of personalisation initiatives is a grave challenge,” said Matt Lloyd, Senior Director of Marketing Technology & CRM at Global Hotel Alliance. He stated a five-point plan for offering personalisation
1) Gather the data at acquisition, ensuring your origin points are aligned and effective.
2) Validation of this data through comprehensive data strategy and step-by-step data cleansing processes to ensure clean and actionable profiles.
3) Engage with members at their channel of origin and optimise to look for opportunities to evolve and enhance the connection.
4) Enhance profiles with continued engagement and collection of data properties from actions and inputs wherever possible.
5) Action: Drive personalisation outputs into respective channels while continually optimising, testing, learning and fine-tuning these actions.
Flender, on the other hand, offered a strategic plan to approach personalisation, starting with “understanding the purpose (WHY) of the business.” This should be followed by data collection across brick-and-mortar, online pre- and post-purchases, and customer service, with first party data at the forefront.
He then suggests leveraging a CDP (Customer Data Platform) for segmentation and analysis of customer data, based on behaviour, demographics, purchase history and interests. The next step is to implement action by tailoring the customer experiences with this data and, finally, measure and iterate the performance of campaigns by gathering feedback from O+O customers and understanding losses and wins.
Has your personalised offer worked? Metrics to check
When it comes to evaluating how well a personalised offer has paid off, Flender said it is imperative to distinguish between passive and active KPIs (key performance indicators). “The active KPIs are the ones directly impacted by personalisation, for example, CVR, while passive KPIs are personalisation’s natural consequences, for example, NPS.”
He categorised the metrics into three buckets:
- A monetary one: With Average Order Value, Customer Lifetime Value (CLV), etc.
- A performance and efficiency one: With Conversion Rate, Unit per Transaction, etc.
- A satisfaction one: with Net Promoter Score (NPS), Customer Satisfaction (CSAT), etc.
To this, Llyod said that performances against non-personalised offers are the best way to measure the success of personalisation. Engagement and user action across a brand’s services that weren’t advertised directly to the customer’s preferences are in a way, an indicator of how well the customer was convinced to make a purchase. “Ultimately, the conversion rate is the primary measure of success,” added Lloyd.
Abdullah agreed, saying that while the KPIs vary by campaign and industry, personalisation is, above all, expected to drive better brand engagement, resonance and an enhanced business and customer outcome. He shared the case of Toyota’s Motorsport Academy, where the company had identified motorsport enthusiasts looking for relevant experience and communication but these individuals were not seeing it from Toyota, thereby looking at it as just another car brand. The metric which made a difference was creating enthusiasm for owning a Toyota, which the company injected into tens of thousands of customers, turning them into fans.
Understanding dynamic personalisation
Dynamic personalisation can not only reduce customer acquisition costs and lift revenue but also increase marketing ROI, improve performance, and provide better customer outcomes, says Abdullah. He iterates that customers today expect brands to be familiar with their interests and value them as individuals. This brings customer loyalty, which can be fostered only by receiving authentic personalisation from the brand.
Flender said building a dynamic personalisation strategy is a continuous process requiring adaptation to customer preferences and market dynamics. He listed down the following factors to consider:
- Understand ever-changing consumer needs and position a problem-solving logic at the centre of your personalisation strategy
- Real-time omnichannel data collection from behaviour, transaction history, demographics, customer feedback, customer identity, etc.
- Data sanity check and cleanup to check that the data is accurate, up-to-date, stored securely and integrated from various touchpoints to create a comprehensive customer profile.
- Real-time segmentation and activation to create the associated automation to activate personalisation in real-time (next best offer, negative remarketing, etc).
- Utilising AI and ML to automate the creation of personalised content, such as product recommendations, emails, website experiences, and marketing messages.
- Data privacy and compliance: Obtain explicit consent when necessary and provide transparency about how customer data is used.
- Collect and analyse customer feedback to understand their preferences and satisfaction levels.
Personalisation, at its roots, is directly connected to customer satisfaction. And successful personalisation in brand strategies hinges on solving specific consumer problems, driven by a clear purpose, accurate data with valuable metrics, and a focus on simplicity. From ‘click’ to ‘order complete’, when a customer completes a transaction without realising the technicalities involved in it, the brand has won in offering them just the right experience.
