Until recently, the high cost of marketing to small target groups meant that every market was a ‘mass market’. Personalization, when it happened, was used to sell high-ticket items, or meant dropping someone’s name into a direct mail shot.
However, new technologies have now made it much easier to target individual buyers with personalized messages specifically tailored to their behaviors, personalities and preferences. That’s enabling today’s marketers to create highly engaging customer experiences that are being seen as the next competitive differentiator.
A survey by consultancy Gartner found that nearly 90% of companies polled were expecting customer experience to be the key competitive differentiator by this year.
Unfortunately, for many consumers such basic personalization has become a pretense that they see through. So very few will ‘buy in’ to a company or see it as ‘their new best friend’ just because someone uses their name in an email or letter.
Basic personalization no longer works
Email solutions firm Lyris found that nearly two-thirds of consumers receive so much email that getting something with their name on it has little impact – and that was three years ago. How much worse is it now?
On the other hand, real personalization that shows true understanding is appreciated by your customers because it helps them identify and get the products, services and experiences they actually want, and to do so more easily.
So for instance, if retailers are able to use the information they gather online about a customer to serve them better at a physical point of sale in a store, then everyone is a winner. Similarly, new smartphone apps with location-based functionality make shopping a much more focused experience as shoppers are led to specific promotional offers and services that cater ever more closely to their needs.
Buyers’ needs first
As data science improves, each additional layer of customer intelligence that is created helps improve the shopper’s experience, so that buying becomes a much more natural process, where buyers’ needs come before the company’s advantage. Why not buy if what’s on offer matches your needs perfectly?
But can personalization go too far? Apparently so. Research by specialist personalization company RichRelevance suggests that it can. Though consumers may be happy when tech is used to enhance the decision- making process, they aren’t if they feel it’s intrusive. So using fingerprint scanning to pay for goods, and smart mirrors in changing rooms that allow virtual trying on of new outfits is fine. However, it seems many shoppers would be uncomfortable with facial recognition software that identified them to in-store staff, who could then greet them by name.
All businesses should be aware of the vast potential of automation to make personalization faster and simpler, allowing your sales and marketing teams to focus on their best-qualified leads.
But while there are almost 11 times more B2B organizations using marketing automation than in 2011, this still equates to only about 5% in total, according to technology news platform Venture Beat.
What’s your Digital index?
Personalized marketing means having to make your message relevant, then using an appropriate marketing channel to deliver it.
By using digital technologies you can do exactly that, optimizing every interaction a customer has with your organization, at whatever point of the buying cycle they are.
But with so many possible digital options available to you, finding the best way to personalize the customer experience can be exceptionally difficult, time-consuming and confusing. Whatever business or sector you are in, it’s not easy to work out what you should do first.
That’s why we created our Digitalization Index. Based on over 200 parameters and competitor benchmarks, it gives smaller businesses in particular the chance to objectively determine their digital priorities. You can find out your Digitalization Index here.