Personalizing the Customer Experience — What’s the connection?

Building bonds with customers is always crucial. In recent years, many brands have turned to personalizing customer experience as a way to foster deeper customer loyalty. It makes sense. Overall, customers like when businesses recognize them as individuals–and are often willing to spend more with brands that do. 

Recent research from the Direct Marketing Association affirms that the majority of customers are on board with personalization. Nearly 60% of people are willing to share personal information–as long as they can get something in return. What do customers want? Better deals, discounts, and personalized offers.

Yes, personalization seems like a win-win for brands and customers. As CX thought leader Shep Hyken explains:

There is one thing that you can do that almost guarantees that your customer will want to come back and do business with you.  It’s more than just delivering amazing customer service. It’s delivering amazing personalized customer service.

There’s no question that the promise of personalization is widely known. But few companies have advanced personalization capabilities. Among retailers, many still focus on the basics like hosting the customer’s order history and wish lists, or presenting recently viewed items, according to Business Insider

retailer adoption of personalization tools personalizing the customer experience iAdvize

And consider this stat from a recent multi-industry Personalization Maturity Assessment. While 98% of marketers know the value of personalization, just 5% say that their companies provide personalization across all channels. 

So what you do to take the lead in personalization? To-dated, many companies have viewed personalization as a data collection and integration exercise. But forward-thinking brands are looking at personalization through a different lens. Instead of focusing on data alone, they’re aiming to meet customers’ growing desires for personalized expertise from businesses.

Retail Dive describes the shift in personalization this way:

All of these insights could put more pressure on retailers to not just invest in personalization technologies, but also seek to build stronger, more personal relationships with their customers that will, in turn, enable them to more fully curate the shopping experience on a shopper-by-shopper basis. 

Here’s what you need to know. Winning at personalization does require a change in mindset. You’ll have to move from old one-to-many marketing tactics to truly personalized one-to-one approaches. And you need to understand customers’ desire for meaningful, relevant personalization.

Most importantly, you need to know the future of personalization is here today. Conversational platforms let you take a genuine one-to-one approach with each customer. If you do adopt a strategic approach of personalizing customer experience, you’ll gain trust, loyalty, and financial benefits as well.

We’ll cover these and other key personalization topics in this post.

Brands Must Shift From One-to-Many to One-to-One Customer Communications

Let’s take a trip back in time and review some marketing history:

Twenty years ago, many companies relied on demographic data and segmentation in their outbound marketing communications. And they viewed these practices as the essential elements for delivering a personalized customer experience (CX). Those companies could group customers into large segments and communicate with them en masse. 

Ten years ago, Amazon began recommending products to customers based on prior purchase history. It was a small change, but a revolutionary one. And it would change the face of personalization.

In recent years, “big data” has been the watchword. Vast volumes of data are readily available to many marketers and businesses. And some brands are charging forward to build their personalization approach around big data.

Today, companies have more data than ever before. They can perform more granular segmentation. But they still lumping customers into broad groups and relying on one-to-many communications. As explained in a Forbes article:

[Today], customer experience still often relies on asynchronous or batch-and-blast communications. Without knowing all that is knowable about a customer and having that knowledge available in real-time across the enterprise, the content then merely caters to the segment a customer “belongs” to without knowing if the content is relevant at that point in their customer journey. 

Why hasn’t personalization evolved in the past two decades?

True, personalization is difficult. It requires unification of data about customers from across the organization, along with real-time data access to shape customers in-the-moment experiences. But organizational data often resides in silos. Most companies don’t have the in-house data science expertise needed to make personalization work. And even if marketers have access to all the data they need, they often don’t have the content they need to deliver personalized one-to-one experiences.

Accenture’s recent Personalization Pulse Check report explains the crux of the issue. Brands are quickly learning that data-backed personalization is very hard to scale. At the same time, customers say they want tailored experiences and brand journeys.

How can you break through this log jam? Conversation is the answer, according to Accenture:

Businesses can meet this new expectation by creating ongoing, two-way digital dialogues that resemble conversations customers would have with a sales or service associate. 

But, Accenture says, customers–not data–need to at the heart of any conversational strategies: 

For brands to succeed in their transformation [to two-way conversation], they need to create an experience that’s led by great design and enabled by data and technology. By putting customers in control of the experience businesses create the most effective and feasible way to scale 1-to-1 personalization.

Customers Want Meaningful Personalized Experiences–Not Invasive or Irrelevant Ones

So what’s the issue with a data-focused approach to personalization? Well, it can actually feel intrusive to customers.

Imagine you walk into a store just to browse. Instead of greeting you warmly, the sales associate ducks behind a counter. You see her looking at you and tapping into a mobile device.  And then she approaches you and offers you a deal on something you might want to buy, based on something you bought before.

Creepy, right?

Shopping online can feel that way sometimes. We’ve all clicked away from a website or left an item in a shopping cart only to see it follow us around on our social feeds. 

That uneasy feeling is one of the primary problems with contemporary personalization approaches. A Red Point Global / Harris poll found that nearly one-third of customers felt some brand’s personalization tactics were too invasive. And 64% said that is because the brand hand information about them that they did not provide.

Now you know the dark secret of personalization. But there’s good news too. The same Red Point Harris poll found that 91% of customers are more likely to shop with brands that recognize and remember them–and offer them relevant choices. Accenture’s research also reveals that customers value personalization. Eighty-three percent (83%) of consumers are willing to share information with brands to make experiences more personalized.

So customers want personalization and brands wants personalization, but personalization is hard to achieve at scale. How to untangle this thorny dilemma?

Some brands have forged full steam ahead with chatbots. And why not? Bots are cost-effective and available 24/7. People can visit a website and have a one-to-one conversation. That’s personalized, isn’t it?

Well, no. Let’s keep it real here. Bots don’t have emotions. They can’t share empathy. And, as we discussed in a prior post, even the best chatbots can’t sustain a genuine two-way conversation.

It’s no surprise that chatbots are winning over customers. Sure, bots work for quick, simple queries. But one study found that over half of people who have used chatbots say that bots keep them from connecting with a live person. And almost half say too many responses aren’t helpful. Chatbots are also notorious for redirecting to self-help FAQs instead of providing meaningful, personalized answers.

Chatbot challenges personalizing customer experience iAdvize

Human-to-Human Conversation is the Future of Personalization

It’s becoming clear that “big data” and bots aren’t helping brands deliver the type of personalization customers desire. Yes, bots and big data are here to stay, but savvy brands are moving towards smarter personalization strategy.

And conversation is the way forward. 

There’s a shakeup happening in digital marketing. Retailers have to unlearn previous personalization approaches and ideas. Segment analysis and targeting are no longer enough.

Instead, companies must start seeking conversational platforms that let them have authentic, human-to-human two-way dialogues with customers. With conversation, your customers have opportunities to create their own experiences. When shopping online, they can ask questions and get the answers they need in real-time from an on-demand brand ambassador. 

This type of interaction creates a memorable “wow factor” for your customers even if they don’t purchase on that visit. When you offer conversations to customers, they can have a feel-good experience that increases their esteem for your brand.

Yes, conversation sounds like the next big thing. But how can companies get started with conversation? And what types of results can they expect to see?

Let’s take the case of a DIY and gardening products online marketplace. The company had a small, but solid customer support function but wanted to improve its pre-sales customer service. Although the vision was clear, the brand wasn’t quite sure how to scale to meet this goal without burdening its busy support team.

Their quest for scalability led the brand to an innovative conversational approach. The brand decided to keep its in-house team focused on post-sales issues and tap into its community of customer enthusiasts for pre-sales. Ultimately, the company wanted to build an on-demand expert community that could chat with customers via messaging.

To find the right pool of DIY and gardening enthusiasts, the company shared a quiz with its active online community. Through the quiz, the brand screened each candidate’s expertise. In the DIY category, they specifically sought out site foreman, individuals with home renovation experience, DIY bloggers, and DIY vendors. The combination of experience, know-how, and credibility has helped build trust with customers.

Since launch, these brand experts have been able to log into the company’s messaging platform whenever they want. They can chat via smartphone or computer at their convenience. And they earn can every time they chat through a mix of performance-based pay and 3% of every sale they generate. For experts, that can add up to between $168 to $225 each week.

And the brand’s results? They’ve been impressive. Customers are happy, and sales are rising.

  • 91% satisfaction rate for expert conversations
  • 20% conversion of online visitors to customers
  • 36% average increase in order size
  • 20 minute average conversation time with an expert

For this forward-thinking plan, conversation is now a core element of their CX program.

mano mano success personalizing customer experience iadvize

Conversation and Personalization Go Hand-in-Hand

Statistics show brands understand the value of personalization. And customers want conversation. But far too many companies haven’t put together the personalization puzzle just yet.

Why is this happening? Some brands have clearly headed down wrong roads. They may have looked to big data as the answer to personalization. But internal silos and system integration issues have stood in the way of the massive data unification needed to actualize the promise of big data. And customers say they find it intrusive when they feel companies know too much about them anyway. 

And neither are chatbots. They offer a cost-friendly, around-the-clock option to field basic customer questions, but not much more. Even when programmed with everyday speech, chatbots just aren’t human. They don’t sound like humans. They don’t offer empathy like humans. And they just don’t work for complex customer service issues.

That doesn’t mean brands should abandon their investments in big data and chatbots. Both have their merits in customer experience. However, they aren’t the keys to personalization.

The truth is the only way to achieve true one-to-one personalization is through a human-to-human connection. A conversation between a human customer and a human brand representative is what personalization is all about. And CX thought leader Shep Hyken agrees:

Is your brand one of the many struggling to figure out personalization? Don’t follow the well-trodden path of big data and chatbots. Take the human-to-human, personalized approach with conversation. In a few years, when you’re viewed as a customer experience leader, you’ll be glad you did.

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Have you heard? Conversation is fast-emerging as the #1 priority for brands that are serious about digital marketing, personalization, and customer experience. Read our white paper “Customer Experience in the Age of Conversational Commerce” to learn how to reinvent how you relate to customers with conversation personalizing customer experience.

fritz.lauer@iadvize.com
Fritz

Digital Marketer with a passion for MarTec. Finding the human element of a brand, and the technology to scale is the name of the game.

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