It’s no secret that personalization has become a key indicator of brand success. Even before the pandemic, we knew data and personalized marketing would be essential for brands looking to build solid, long-term relationships with their customers. Still, when the pandemic forced brands to ditch nearly everything for digital platforms, personalization became an even more dominant force. In fact, a new report from Twilio Segment, one of the major players on the customer data platform front, shows personalization has never been more necessary for brands looking to last the year, let alone the next decade. Is your company prepared to meet growing consumer demands for more personalized content and shopping experiences?
Personalization as a “Basic Expectation”
The annual Twilio Segment report, first released in 2017, cased the opinions of nearly 3,000 consumers and business decision makers, showed that personalization has become a “basic expectation” among consumers, meaning the average shopper expects brands to remember them—their preferences, their history, their location, their sentiments—on every channel, at any given time. For brands looking to build deep and meaningful loyalty, this is both a welcome answer and a gut punch. There’s nothing like knowing exactly what you need to do to win customer loyalty—only to feel like that answer is fully impossible given how many channels there are on which to interact with customers, and how often customer sentiments change.
The Twilio Segment report, then, pushes brands to understand that in order to survive in the current marketplace, they will need to re-think how they use their resources: how they collect and manage data, how they process that data meaningfully in real-time, how they build seamless cross-channel experiences, and how they show their customers they know and understand them in a way that resonates at every click.
The challenge for brands right now is that customer expectations are growing faster than companies’ abilities to meet them—which is why making time to understand this formidable shift is so important.
Understanding the Data: What Personalization Means to Customers
While many companies are trying to keep up with personalization, there’s a clear gap between what they are providing and what customers really want. For instance, according to the Twilio Segment report, 85% of businesses say they are providing a somewhat personalized experience to customers, but 60% of consumers agree with that. As a consumer myself, I’d have to say 60% feels high to me—I feel like about 50% of what I get isn’t even close.
Sure, I get personalized emails, Instagram shows me ads for things I’d possibly like, and Netflix can generally provide some personalized recommendations on what I’d like to watch on a given night. Still, I wouldn’t actually say there are many brands that really know me—that send me offers for just what I need at the right time, on the channel I most enjoy receiving them. In other words: there’s a big difference between creating content that “agrees” with someone and providing them with a personalized shopping experience.
If you’re a business trying to keep up with customer expectations, what do you do? Well, it isn’t as complicated as it sounds. Keeping some of the insights from the Twilio Segment report in mind, the following are some recommendations:
- Act on the data you have. According to the report, 78% of customers have been frustrated by a shopping experience that hasn’t changed, even after they provided negative feedback, and 77% of consumers say they’re frustrated when they get push notifications or text messages for promotions they’re not interested in. What it all boils down to is this: if you know something isn’t working for your customer, fix it. And if you see they’re not responding to being communicated with on one channel, stop using it! These are surface level insights you can act on now to get better results.
- Invest in accurate, real-time data. Clearly, personalization relies upon accurate data. One of the most important things you can do is invest to make this a reality. Yes, you may experience some pushback regarding ROI. But check this out: according to the Twilio Segment report, 60% of consumers say they are likely to become repeat buyers after a personalized shopping experience, and almost half say they are less likely to make a purchase from a brand after an un-personalized experience. The truth is: the choice isn’t whether you should invest or not invest. It’s whether you want to stay in business or not. So, if you aren’t investing in a solid customer data platform, you’re definitely behind.
- Invest in first-party data. Not to stress you out, but having accurate data isn’t enough. You need to be collecting your own data—first-party data that your consumers willingly entrust to you. Why? For one, it’s more likely to be accurate. Second, you can be more transparent with how you’re getting it and why you need it. And third, because you’re likely to be able to keep it secure. Nearly 70% of consumers say they’re OK with personalization as long as brands are using first-party data, rather than buying it from a middle-man. So, invest the time it takes to gather the data you want directly from your customers. You’ll be glad you did.
If Personalization is Table Stakes: What’s Next?
Honestly, more and better personalization, even at the expense of more and better channels. If your company is in a situation where you can’t scale both channels and personalization equally, choose to focus on personalization in the few channels you know you can manage best. Given a choice, 61% of consumers say they’d prefer fewer, better channels when shopping with a brand.
There are so many pressures on brands today to connect with customers—to offer the right product at the right time at the right price-point, to be transparent, to present shared values, and to somehow do it all while staying profitable. It can feel overwhelming. The truth is, though, when your values are aligned with your business strategy, things tend to fall into place naturally. With the proper application of data, tools, and experiences, the right customers will find you, and by investing in personalization, you’ll find great fulfillment in knowing them, inside and out.
Disclosure: Futurum Research is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.
The original version of this article was first published on Forbes.
Daniel Newman is the Principal Analyst of Futurum Research and the CEO of Broadsuite Media Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise. From Big Data to IoT to Cloud Computing, Newman makes the connections between business, people and tech that are required for companies to benefit most from their technology projects, which leads to his ideas regularly being cited in CIO.Com, CIO Review and hundreds of other sites across the world. A 5x Best Selling Author including his most recent “Building Dragons: Digital Transformation in the Experience Economy,” Daniel is also a Forbes, Entrepreneur and Huffington Post Contributor. MBA and Graduate Adjunct Professor, Daniel Newman is a Chicago Native and his speaking takes him around the world each year as he shares his vision of the role technology will play in our future.