Dive Brief:
- The average experience isn’t as personalized as brands think it is. While leaders estimate that they personalize 62% of experiences, customers say only 44% of their experiences feel personalized, according to a Deloitte Digital survey released last month.
- Not all forms of personalization are equal: Almost 9 in 10 leaders rate their personalization efforts as good or excellent, compared to 3 in 10 consumers, according to the survey of 480 leaders and 1,000 consumers.
- Better personalization pays. More than half of consumers say they are more likely to make a purchase from brands that personalize their experience, and on average they spend over 30% more from those brands.
Dive Insight:
The key to great personalization is understanding and acting on consumers’ needs in a relevant fashion, not just amassing information and using it for targeted messaging.
Brands can get a leg up on personalization by focusing their efforts on understanding customers’ recurring decisions and improving the experience around those decisions, according to Trinadha Kandi, U.S. retail & customer marketing transformation leader at Deloitte Digital.
“Start with what customers define as useful, not simply what the campaigns produce,” Kandi said in an email.
Consumers say the top use cases for personalization are when it proactively resolves an issue, saves money or makes them feel recognized through loyalty benefits, according to Deloitte Digital.
“Brands measure their output: campaigns, segments, activations,” Kandi said. “Customers judge the relationship: did you understand me, remember me, make the next interaction better? What brands call personalization is often just more targeting, and it’s slow.”
AI can help brands understand their customers, but its implementation needs to be handled with care.
Nearly all brand leaders — 97% — say changes to AI are outpacing their ability to optimize AI tools for personalization, and failed pilots just contribute to silos, according to Kandi. The brands that lead in providing relevant personalization build AI into a single governed system that shares customer context, decisioning and feedback loops.
“The goal isn’t to create more content or more models,” Kandi said. “It’s making better decisions across the customer relationship.”
