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How personalisation can lead to failure?

Personalization, the key to success

Are you a retailer who has recently sent out Valentine's blanket promotional email to your entire customer base? You may be missing an enormous opportunity to improve your customer’s experience and tap into a potentially huge revenue stream: personalization. Without it you could be causing immense damage that you are not aware of. With the extraordinary amount of data your customers provide to you, it can be fairly straight forward to implement a personalization solution to target customers with relevant content and products rather than resorting to mass generic marketing campaigns which have a very low conversion rate. But before you head off to buy the latest personalization platform, here are points to consider:

 

The challenge of the use of data

Customer’s expectations are evolving rapidly, similar to Moore’s law, the Law of Experience is doubling every 18 months. The feature that excited them yesterday, is expected today and old news tomorrow. Retailers who don’t rise to meet the challenge of the customer will go the way of the dinosaurs. Anonymous customers provide retailers a huge amount of information about themselves. Registered customers linked to in-store loyalty cards provide a gargantuan amount of data to the extent that retailers know more about a customer than he knows about themselves. Retailers must listen to their customers and use what the customer is telling them to improve their customer’s experience. But that is not enough. As a customer continues along their journey with the retailer, the picture of the customer must evolve. In the past personalization was defined as categorising customers into silos such specific gender and age segmentation. But that’s not personalization, that’s “groupization”. Personalization is far more than segmentation. Gone are the days where retailers could fit customers into neat little boxes. Customers are individuals, they expect tailored sincere content at the right time via the right channel in the right format in the right language and a consistent and compelling narrative across all channels. They engage with the retailer on a 1-to-1 basis and they expect the retailer to have the courtesy to do the same. They expect “Individualization”. To keep up with customer’s expectations retailers must move beyond data warehousing. This is reactionary. Customers expect retailers to be agile and apply real-time analytics which adjusts their experience as the customer continues along their journey.

 

A vision of personnalization

So where to begin? Not with technology. That’s just the tool. There’s some prep work required. Before evaluating technical options, it is absolutely critical that you have a clear and defined vision for personalization. This vision must integrate marketing, data, and technology. To paraphrase Jim Collins, author of Good to Great, once you have the right people on the bus and in the right seats, then the personalization journey can begin. Everyone must share in this vision, from c-level suit to developer.

Critical to the implementation of this vision is to have a complete and consistent view of the customer regardless of the channel, a single view of the customer shared across all channels. This in itself is a huge task for most enterprises; the typical enterprise solution has customer data distributed across 36 different platforms. You can only personalise to people you understand and you need all the information your customers are telling you to have a complete picture of them. The customer does not think of channels. Work to unite the digital and physical worlds so regardless of the channel you are engaging with a customer, via email, mobile, desktop, call centre, social media or in store, the customer hears one consistent narrative.

 

Contextualization is key to success for your vision

For example, I may be a customer who is an extensive business traveler who has just bought airline tickets for a family holiday. Don’t promote offers for business suites, show me family resorts. Similarly, don’t just aim to sell, the power of loss is far more than the power of gain. Avoid annoying a customer can be far more beneficial. For example, if I have just bought an iPad, ensure that I am not included in the next campaign offering 10% discount on iPads or if I have a support ticket open for poor customer experience, hold off on sending marketing material.

Ensure your vision provides for robust rich engagement. Follow up with the customer to find out how their new appliance is going and offer some handy hints. Instead of then trying to sell them a new tour package, provide useful tips to making it simple to get through the airport and handy tips for parents with kids. The tour promo can come later and then the tour should be kid-friendly. Across all channels, agents should know we’re on a family holiday, not a business holiday. Email should be tailored to my trip, my reminder text messages, my printed flyer in my snail mail post or print catalogue, my check-in online messages, my search results on the site, homepage, printed online tickets, etc. Be sincere. Customers can smell insincerity a mile away.

 

A clearer vision, an easier technological choice

The technical solution should ensure that all parties are engaged and that the data is accessible and understood by all sectors, including the c-level suit. These are key decision makers.

How can you justify the potentially sizeable capital outlay to implement your vision? Specialist technologies such as SAP’s hybris Marketing or Adobe Marketing are certainly not cheap. The ability to address a customer on an individual basis but this provides the key to unlocking an enormous potential revenue stream. It is going to be far more expensive to try to win a customer back after you have annoyed and alienated them. The ROI of a proper personalization solution, if implemented correctly, will far outstrip any generic functionality at equivalent cost. Increase in online revenue is unlikely to justify the spend alone. Only 1 out of 6 sales conclude online. A customer could start their journey online and complete it in store. ROI needs to include improved sales across other channels. Don’t just consider dollar-based metrics. For example, the speed to conclude a sale (close gap between discovery and sale) or the reduced number of support calls or the improved perception in social media through better interaction with sales assistance, better product selection and improved customer service indirectly add to increased revenue.

A platform selection may seem a bit daunting

 There is a plethora of personalization technologies available with varying degrees of functionality and at varying costs. The latest and greatest may not be right for your organization. Don’t expect to just dump data in and magic to happen. It’s important that it fits your current, or easily acquired, skill set. Be warned of going cheap. The platform should have a proven track record of constantly evolving so you can gain from latest developments that your customer will soon expect, for example virtual reality or artificial intelligence marketing. The cost to re-platform can easily negate all the financial gains made up to that point.

Once the technology has been selected, keep the focus on the vision. Start simple with a base technology and add additional layers of complexity and functionality where each component leads to an improved connected coherent customer experience. Ask a question, test, fail, learn, adapt quickly and repeat. It will take time to grow experience. Don’t be afraid to explore new approaches and upset the applecart to jostle things up.

A word of warning

Customers have entrusted retailers with their precious data. Make sure it is protected and used wisely. Be very careful not to overstep the bounds and become creepy. A great personalized experience doesn’t look like personalization. Guide customers, give them a nudge in the right direction. It’s a personal touch if you tell me a new product is on special at a store where they regularly shop. It’s creepy if you tell me that I shopped 37 times in the last month at the store 2.31 km from my home and from my shopping behaviour you think I have an 83.2571% chance of liking a new product. Aim for personal not creepy. Don’t try force a sale. Take the time to understand your customer’s journey and infer the intent from the customer’s behaviour – past behaviour is not necessarily a predictor of the future and neither is other people’s behaviour (refer to the airline tickets example earlier).

 

Always be authentic and sincere

How would I have gone about Valentine's marketing exercise? First of all, I’d provide a personal (not creepy) touch. I would address the customer by name at a minimum. Secondly, I would not shove products into their face from the outset. I would be authentic and sincere (a customer can smell insincerity a mile away). If I used myself as an example customer: I’m a married male in my 40’s so how about providing me with some creative yet reasonable ideas to show my wife some genuine appreciation? A simple search on Pinterest will give some clever easy ideas to present to me, the creatively-challenged husband. Now that the Retailer has earned my trust and interest they may send me some carefully selected products that are available at the stores where I shop or direct me online. When I venture online, link up the content and products so I see the selected products rather than the latest dress worn by the “Kardashians” (whoever they are). It’s not rocket science; it’s just applying thoughtful use of what I have told the retailer. The result is that I end up appreciating the retailer for helping me being prepared and spoil my wife with something more thoughtful than flowers and chocolate, something a little more creative and special. Follow up a week or so later to see how it went with some ideas to let my wife know it’s not just on Valentine’s day when I appreciate her. Nice job Mr Retailer, you’ve emotionally engaged with me, guided me and helped me out.

Remember your customer has the power.

The bottom line is, don’t shout at your customer through a loud hailer with generic nonsense and throw irrelevant products at us in the vain hope that something will stick. You’re annoying them. Listen to what each of customers is telling you and in turn speak to them on a 1-to-1 basis. If you don’t start listening to them, they’ll go to your competitor who may not be soliciting them at all but at least they aren’t ignoring what their customers are telling them.