The Race for Personalization: 3 Steps to Get Ahead

In Western culture, people introduce themselves by shaking hands. Europeans acknowledge each other using three alternating kisses on the cheek. South African’s use the greeting, ‘Sawubona’. Loosely translated, this means: I see you. This greeting captures the way that successful retailers and businesses are marketing to and communicating with their customers. Businesses that communicate with customers by name while only showing content they want to see and suggesting products they didn’t know they wanted, are dominating the market today. ‘Personalization’ has become the new buzzword in marketing and it is driving companies to curate experiences for the individual instead of the crowd. Companies are replacing mass marketing tactics with a strategy that says ‘I see you.’

Marketing teams are extremely enthusiastic about the prospects of personalization, with 88% claiming personalized strategies have positively contributed to sales. The same study, conducted by Janrain, found that 48% of consumers spend more when marketers make them feel like the experience has been created just for them. With an understanding of the way people want to be communicated with, management needs to think about how to connect with their customers in a more personal way.

To show they know customers and to create the experiences users are looking for, companies must capture a robust user profile. The best personalization strategies capture both the data a customer voluntarily provides (e.g. a 5-star movie review) and the data that can be implied from their behavior (e.g. 4 seasons of ‘The Office’ watched in 1 day). By capturing both of these data points, companies have a complete profile of explicit and implicit insights that can be used to serve up recommendations, understand user preferences, and create a basis for deeper, more meaningful relationships.

We can see why companies should embrace a transition to personalized marketing strategies. To form a successful personalization strategy, management must first craft a data strategy. This starts with building an understanding of how to aggregate data in a way that can deliver the required insights. Without a database and method of capturing user profiles and preferences, there is no way to capture the benefits of personalization.

To address the data problem, companies have begun to realize they need more robust data infrastructure and decided to move their existing, sporadic databases to cloud-based solutions. This approach may seem pragmatic, but often leads to delays in capitalizing on the gains personalization can bring. It also results in large upfront costs due to intensive work required to migrate to the cloud. Prior to venturing on a large scale data transformation, companies should instead consider a more agile approach.

Here are some helpful steps to guide this strategy:

1. Complete a data availability assessment - Find out what data exists and the quality of the existing data
2. Identify quick wins - From the data that is available, determine which data points contribute to user profiles
3. Determine missing information - From the data that is available, identify gaps that need to be filled to create a more robust profile of the customer

Following these 3 steps allows for the migration of smaller amounts of data the cloud. Smaller data migrations happen quicker and at a lower cost and provide companies the ability to experiment with early iterations of personalization. These steps also allow management to begin creating processes for data collection which will fill gaps in the existing dataset. Starting with a small data migration, allowing for experimentation, and setting up new data-collection allows companies to immediately roll-out a personalization strategy and primes them for increasingly powerful strategies in the future.

Many companies today are still shouting out to the masses and hoping someone is listening. Those who look their customers in the eye and say Sawubona - I see you - will enjoy increased revenues and a sustainable competitive advantage.