Building a Personalization Strategy? 3 Things to Understand

personalization-strategy

How many times has one of your favorite retailers emailed you about a sale in a category in which you’ve never shopped? How often have you visited a company’s website that has shown you a how-to video for a product you’ve never purchased? Unfortunately, almost no one is immune to these types of experiences, and it’s having a tremendous effect on how consumers perceive brands.

According to studies from Forrester, 61% of US online adults are unlikely to return to a website that does not provide a satisfactory customer experience. What we’ve learned through our own research is that consumers now only spend time with content that earns their attention and is personally relevant to them as individuals. This is putting more and more pressure on brands to deliver on those expectations through personalized experiences.

Forrester reports that 89% of digital businesses are investing in personalization. These are the organizations that recognize the opportunity to use content to build brand preference and increase engagement with their audience by delivering personalized experiences across all channels.

But where a lot of marketers fall short in developing a personalization strategy is understanding that personalization isn’t just a marketing tactic. It’s a strategy that spans the entire customer journey, across every digital touchpoint with a brand. If you’re ready to build out a personalization plan for your brand, you’ll need to consider the broader aspects of personalization as a business endeavor. Here are three things that are important for you and your marketing organization to understand and consider as you get started.

What does personalization look like?

Personalization is the strategy of delivering unique and relevant experiences for prospects and customers across all channels and touchpoints within the customer journey—from discovery to conversion and beyond. But not all personalization is created equal.

With explicit personalization, you personalize your website based on information known about the consumer, such as logged in account information, purchase history, preferences, polls, and simple form inputs like zip code. With implicit personalization, you change your website (from images to content to calls to action) based on how the consumer interacts with your website along with what you know about the user from their browser, such as  geo-location and referral data. It’s important to understand how personalization can take form across the customer journey and ensure you have the right vision and expectations for how you intend to serve up a personalized experience.

What type of personalization will you use?

Marketers have a tremendous challenge in determining how, when, where and why personalization approaches get delivered in different contexts. This is why it’s important to understand the different levels of personalization that are available today so that you can choose the right approach that aligns with your business objectives.

The first level is segmentation, otherwise known as “Personalization 1.0.” This is the process of dividing your entire customer and prospect database into different groups based on data points such as age, gender, location, and past purchase history. To personalize the experience for this audience, you have to manually tailor your content based on each data point. And this level of personalization only allows you to deliver the same set of targeted content to a select group of contacts.

The second level is individualization, which is a strategy that uses machine learning, a subset of artificial intelligence (AI), to predictively personalize the content experience based on user behavior, context and lookalike analysis. This level is known as “Personalization 2.0” because it enables content delivery on a 1:1 basis for each individual. This approach uses machine learning algorithms to dynamically generate content experiences for individual members of your audience to repeatedly engage them across channels, and in turn, help them continue to build a deeper relationship with your brand.

Why should brands prioritize individualization over segmentation?

Early adopters of individualization are embracing the shift to engage each individual customer, and reporting great success. Avocados From Mexico is one such brand; their team leveraged machine learning to deliver individualized content experiences, recommending the most personally relevant content to each consumer based on their interests and preferences. As a result, the brand built a highly effective personalization strategy and experienced much higher levels of engagement with customers.

While marketers are taking steps to deliver personalized content and customer journeys, many confuse true 1:1 personalization with traditional, segmentation-based approaches that fail to deliver the individually relevant experiences their audiences expect. When this happens, marketers alienate their audiences and often make the customer experience worse, not better. Companies that recognize the need to treat customers as individuals leverage AI technology and big data to deliver real-time experiences that truly engage.

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