The Personalization Plunge Key Steps to Start Unlocking the Power of Relevance

Philosopher Charles Taylor argued in 1992 that people not only desire recognition, but crave it as a "vital human need."

Twenty-five years later, this theory has emerged as a powerful force at the heart of consumer behavior. Today's customers expect to be treated as individuals, and are increasingly shifting their spending and loyalty to brands who demonstrate an understanding of their unique needs and respond to them with relevant messaging and experiences.

While the concept may sound simple, it's one many companies struggle to effectively address – especially those with limited budgets and resources. But whether you're on the Fortune 500 or a startup with a team of five, the fact is modern consumers are changing the way they make they make their purchases, and you can't afford not to adapt with them. Accepting this new normal and committing to investing in a more customer-centric model is step one on the journey to personalization.

Demystifying Personalization

In order to start embedding the customer-first mindset into your organization's culture, it's important to first define exactly what personalization means.

Personalized marketing means one-to-one marketing in the truest sense: one brand speaking directly to one customer. It means meeting the customer’s needs more effectively and efficiently; making interactions faster and easier and-consequently-increasing customer engagement, satisfaction and retention.

Don't Drive Blind

If personalization is the vehicle to meet heightened customer expectations, then data is the engine. So take a look under the hood by thoroughly auditing the current state of your data collection processes:

  • What kind of customer data are you currently capturing?
  • Is it enough to recognize, understand and remember them?
  • Do you have the resources in place to turn data into insights that can help anticipate their future needs?
  • Where are the gaps that must be filled to turn insights into action, both short-term and long-term?

Keep It Clean

In the short-term, compiling and cleansing all data is a must. This means amending or removing customer information in your database that is incorrect, incomplete, improperly formatted or duplicated to ensure you have an accurate, up-to-date view to strategize around.

Data cleansing is not a one-time process; it should be a regular part of your marketing workflow. Sound data hygiene directly translates to lower costs and higher response rates. Have you ever received duplicate or inaccurate messages from a brand? That’s both money and an engagement opportunity wasted.

Implementing the right talent and technology to support data analytics has to be a top priority when building a personalization framework. Without this step, it’s all guesswork. In most cases, personalization is not worth pursuing unless you’re able to invest in at least shoring up data deficiencies.

Inaccurate data has a direct impact on the bottom line of 88% of companies, with the average company losing 12% of its revenue as a result.1

User Profiles: True North for Personalization

While resource and software sophistication can vary widely based on your company’s bandwidth, distilling data into user profiles is a manageable and productive exercise for any marketing function seeking a more holistic view of their customers.

User profiles expand on traditional demographic-based segmentation to help identify the preferences and interests of a particular customer based on historical behavior analysis.

At a basic level, this intent-based approach helps frame a better understanding of:

  • Relationship: Is the customer a loyal source of recurring business, an “on-and-off” purchaser or a one-time buyer? Are there any known pain points?
  • Needs: What types of products has the customer bought? Are there patterns in terms of timing or project type?
  • Buying Style: How does the customer like to communicate? What is the typical transaction process entail?
  • Sensibilities: What kinds of topics are of most interest to the customer? Does he or she prefer to consume content digitally or in print?

Content - Context is King

Categorizing customers by user profile helps inform more relevant, contextual content. Whether it's a customized offer or simply copy and imagery that resonate with the customer as an individual in some way, any degree of personalization beats generic "spray and pray" mass marketing. A 2017 Constellation Research study reinforced this reality, showing that lack of content relevancy generates 83 percent lower response rates in the average marketing campaign. With internal scrutiny of marketing ROI heightening right alongside customer expectations, stats like this can't be ignored.

More Than Just Today's Buzzword Du Jour

While there is no silver bullet to attain the marketing holy grail of delivering the right message to the right person at the right time, personalization has been empirically proven to help drive higher conversion rates, increase revenue and build loyalty. And according to a 2016 study conducted by The Economist Intelligence Unit, forward-looking marketing leaders have taken notice. In fact, 45 percent of global marketing executives polled believe personalization technologies are a trend that will have the biggest impact on marketing companies by 2020.

The Good News

Personalization is still in its relative infancy; and if you're yet to master it within your organization, you're not alone. Only 6% of senior marketers polled by Monetate in February 2017 said their implementation of personalization was advanced; 56% said they're in the process of getting their personalization strategy set up; while 28% were "just starting out."

For the remaining 10%, the risk of delaying much longer just might outweigh the challenges of getting started.

How to Maximize Your Personalization Strategy’s ROI

1. Experian Data Quality. Global Research Survey (2014)

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