April 2, 2019
It has become well known in recent years that baseline personalization is not going to cut it anymore. Brands that have excelled at delivering personalized customer experiences are seeing revenue growth at 2 or 3 times the average. So, if you’re looking to revamp your personalization strategy, you’re going to have to really stand out and get with the times.
One of the biggest challenges facing the industry is the existential threat that brands such as Amazon pose to the success of companies old and new. Now, there is a new wave of demands that brands are going to need to stay on top of.
Let’s delve into how to better prepare your brand for the new personalization demand.
Let’s first take a look at some of the ways personalization strategies are being driven in the present before we dig deeper into what’s in store. As stated in our 2019 Personalization Development Study, 93 percent of businesses with an advanced personalization strategy experienced revenue growth over the course of the last year. Alternatively, 53 percent of businesses with no personalization strategy whatsoever experienced revenue loss.
These simple stats alone make it clear: Personalization is a must. You may already be providing relevant product recommendations, custom homepages, and special offers, but the face of the game is going to change. Now, you need to learn how to look at where the trends are headed and what that means for your brand.
When building a new strategy, one of the most important areas to assess first is where the competition is. So, what are your competitors doing that you aren’t?
First, they may be investing more in their personalization efforts. Companies that have seen a boost in revenue due to personalization have decided to set aside a substantial budget for it. If you don’t have a dedicated personalization budget, you could miss out on greater return on investment (ROI). After all, 86 percent of companies receiving the highest ROI from personalization say that personalization makes up at least 21 percent of their overall marketing budget.
Even more importantly, there is increasing evidence that companies seeing the greatest success tend to put a deep customer focus at the core of everything they do. Centering the customer experience has been the name of the game for a while, but some businesses still read that as shorthand for “create an experience that encourages conversion” without thinking beyond the transaction. Conversion remains essential, of course, but the greatest value comes from cultivating a meaningful and lasting relationship that extends beyond the first or second purchase.
So, how do businesses measure that? They’re focusing on customer lifetime value (LTV). And what’s more: The revenue results follow. Companies with high ROI from personalization (at least 3X) tend to already be focusing on improving customer loyalty. Those who have low ROI (1X or less) are nearly twice as likely to report a focus on short-term metrics. To back this up, Criteo reports that 81 percent of marketers agree that monitoring LTV increases sales. Placing customer lifetime value on your list of primary business metrics will either put you ahead of or right on par with your competitors.
Another ara where your competitors may be pursuing an advantage is artificial intelligence (AI). According to eConsultancy, 88 percent of marketers agree that AI will allow them to become more effective. Furthermore, nearly 3 out of 4 businesses have plans to invest in machine learning/AI or are investing already. If you fall into the remaining quarter, however, it might be time to reconsider.
With an understanding of the present demands for personalization and what your competitors are already doing, it’s time to take a look inward. View your weak spots as windows of opportunity. There are tons of untapped ideas to capitalize on that others haven’t, so don’t get discouraged.
For instance, 76 percent of respondents to a Voices.com survey say they believe voice-overs help a brand connect better with their target audience. As home devices and other voice-activated technologies continue to rise in popularity, take note of where you can potentially personalize. If that seems a bit too risky to begin with, look for the chance to deploy a chatbot. A personalized chatbot can go a long way, and it is decreasing manual manpower while automating.
You should look into areas where you can make your customer experience more dynamic. As the demand for personalization grows, expect dynamic content to be a large part of what your users are looking for. Find ways in which you can dynamically display new content such as a geo-targeted or weather-related homepage, helpful resources for products that are in the customer’s cart, or even videos based on previous searches. While the use of dynamic content is nothing new, it is absolutely going to be sticking around.
As the trends progress, be aware of where a personalization engine could fit into your specific strategy. A personalization engine with open architecture allows you to integrate technologies into your strategy, whether that be a content management system or a chatbot. This will help you to incorporate the newer trends for a competitive edge.
Plus, at the rate the game is changing, you’re going to want to have a solution that shows signs of innovation and growth. Look for a unified platform that will be able to provide personalization across multiple channels. As your strategy evolves, you will be happy you went for an engine that can easily grow with you.
For more information on how to get started with a personalization solution, take a look at the Monetate Intelligent Personalization Engine. Or, to learn more about emerging trends, flip through our 2019 Personalization Development Study.