The Real Reason Customers Are Frustrated with Predictive Personalization

By Yvette Hastings in Marketing
·6 min read

There simply isn’t enough of it! On average, 71% of consumers feel frustrated when their shopping experience is impersonal, and 36% of consumers believe that brands should offer more personalization. So when 91% of consumers are more likely to shop with brands that provide relevant offers and recommendations, why are we still questioning the benefits of brands getting personal?

Personalization is hardly the new kid on the block. We’ve been talking about delivering an individual and tailored experience to customers for many years now. But apparently only half of digital marketers say personalization is a top priority.

If you’re in the half that doesn’t consider this marketing strategy to be an essential part of the customer experience and you’re not using real data to create truly relevant and unique experiences... you’re not just missing a trick, you’re missing the point.

An Audience of One: Me

Wherever you’re standing, the view ahead for digital marketers is “Me”. We’re in a narcissism epidemic.

The customer’s royal status has gone to his head, and he sits impatiently on his throne expecting for more and more and more. His refrigerator orders his food. His TV picks his shows. His Facebook knows him better than his mother does. And his next of kin are Alexa and Spotify.

As customers, we live in a world where technology listens, absorbs, understands, and reacts to our interests and preferences. Personalization expectations are high!

Coca-Cola launched its “Share a Coke” campaign in 2014, putting first names on coke bottles. Such a simple idea; but it is now one of the most successful marketing personalization campaigns of all time. It put “me” center stage.

According to Segment, 32% of customers expect a tailored discount just an hour after identifying themselves to a company, and 54% within 24 hours. In fact, 63% of consumers cease purchasing from companies providing poorly executed personalization.

This is not one of those trends you can sidestep or leapfrog. It’s built into the very fabric of your customer’s life, and if you’re not woven into that.... Where are you?

Personalization: Now Even Hotter

What does success look like for you? Increased sales? Boosted engagement? More time on site? Customer loyalty? Better ROI? Whatever your goal, personalization is your highway.

According to Adweek, personalization can halve acquisition costs, boost revenue by 5–15%, and increase marketing spend efficiency by 10–30%. It can also increase brand loyalty among millennials by 28%!

A Segment study found that not only did nearly half of customers make an impulse purchase as a result of personalization, but 85% of the of them were happy with their purchase. Of the remaining 15%, only a third, actually returned the items. 

Furthermore, 40% of U.S. consumers have made purchases more expensive than originally planned because of a personalized experience, and 44% say they’ll likely bring repeat business.

It’s a lot of numbers, but the numbers don’t lie. 

39% of marketers personalizing experiences through search engine marketing reported a major uplift from it, and a study by Hubspot found that personalized calls to action converted 202% better than default versions!

With such compelling results, how are only 31% of customers happy with the level of personalization they receive? How are we not all acutely attuned to every breath our customer takes and ready with predictive suggestions and assistance. Why are we not all delivering the super-sensitive personalized experience that not only attract, engage, and nurture our customers, but that they have come to expect?

Well, according to Econsultancy’s Digital Trends 2018 report, only 7% of companies consider personalization their number one priority, with 20% focusing on content management instead. So perhaps we’re failing our customers not for want of trying, but for want of technology... The horse is chomping at the bit, but for want of the shoe, the kingdom is lost.

Personalization: A Question of Technology

According to Impact, 32% of companies claim a lack of relevant technology is a major challenge in delivering personalization, with 46% blaming legacy technologies. The majority of brands surveyed considered themselves below average in their ability to extract useful insights from their customer data. And just 14% considered themselves strong in gaining one single view of the customer.

While Emarketer found that  63% of marketers consider data-driven personalization to be the most difficult online tactic to execute, a survey by SmarterHQ found that 72% of consumers will only engage with customized marketing messages.

The fact is: it’s only with sophisticated and integrated DXP (Digital Experience Platform) and CRM (Customer Relationship Management) technology that behavioral analytics, visitor tracking, segmentation, customer personas, and content personalization become a reality. Without the technology that transforms multi-channel efforts across email, web, mobile, direct mail, and social media, into one cross-channel view of the customer, you really don’t know them at all.

And this affects not just how a customer feels valued and appreciated, it affects their whole experience of your brand and can mean they head elsewhere,  where “me” is put first.  A tailored experience is not a nice-to-have, it’s an expectation.

SmarterHQ found that 47% of consumers will go to Amazon if a brand they’re shopping with doesn’t provide relevant product suggestions. Why? Because Amazon does it brilliantly. It remembers them and welcomes them back. Its entire homepage is a personalized list of recommendations and promotions based on their search and purchase history. It’s like calling a friend.

Getting serious about going personal is a marketing-wide strategy shift. It’s about rewiring your customer engagement from batch-and-blast messaging to speaking to an audience of one (many times over). It’s about swapping a multi-channel mess for cross-channel cohesion. It’s moving away from guesswork towards real and actionable data.

By employing AI marketing capabilities to deliver insights that then lead to even more personalized content, you can get exactly the right message to the right people, at the right time, on the right device.

Privacy and Personalization

There’s a fine line between keen and creepy. 40% of consumers consider some personalization efforts creepy because of incorrect assumptions made about them. But a study by Kentico found that 69% of customers were willing to exchange personal data for a better, more personalized service. In fact, SmarterHQ found that 70% of millennials are willing to allow tracking of their browsing and shopping behaviors in exchange for a better shopping experience, while 90% of consumers are willing to share their behavioral data for a cheaper or easier one.

And don’t let the GDPR (General Data Protection Regulation) panic you when it comes to personalization. Although it should be at the heart of all your data collection, storage, and transfers, "the processing of personal data for direct marketing purposes may be regarded as carried out for legitimate interest". So rather than seeing GDPR as a threat to your personalization efforts, you can view it as an opportunity for increased targeting and engagement while earning that coveted of all things: trust.

There really is no excuse for not making the customer experience as welcome and personal as possible. If your technology isn’t up to the task, you need new technology. It’s as simple as that.

Get Personal or You’re Letting Your Customer Down

If you’re not doing everything you can to deliver a unique and special experience to each one of your customers, you’ll soon get left behind.

In a world where Uber allows its passengers to sync their Spotify playlist so they can listen while they ride, and Netflix is in constant flux around its audience's specific interests... there’s a whole lot of expectation out there. But don’t be disheartened, there is a whole lot of opportunity too.

Supported by the technology designed to make it all happen, you can engage, impress, and even surprise your customer. And it’ll do wonders for your bottom line!

What are you waiting for? Connect with an expert and find out more about personalization in Kentico now.

By Yvette Hastings in Marketing
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