Today’s marketplace is constantly fluctuating and its vital organisations adapt, by harnessing the power of analytics and artificial intelligence (AI) to make the necessary changes to survive and thrive. Hyper-personalising (or individualising) is the most advanced way brands can tailor their marketing to individual customers.
Having a robust marketing strategy isn’t enough anymore. As consumer expectations change, competition becomes more advanced, and data gets more detailed, CMOs are under immense pressure to modernise their approach to marketing. This has added complexity to their roles and placed them at the heart of organisational success.
What are the challenges for a modern-day CMO? Pivoting to a digital-first mindset, using AI to create stronger, more authentic interactions with customers, and effectively using technologies to capitalise on data for insights-driven results are just a few.
It’s done by creating custom and targeted experiences through the use of data, analytics, AI, and automation. Through hyper-personalisation, companies can send highly contextualised communications to specific customers at the right place and time, and through the right channel.
As digital marketing becomes more competitive, hyper-personalised marketing provides the opportunity for organisations to meaningfully engage customers, deepen existing relationships and build new ones, and improve the customer experience.
Implementing this type of strategy not only increases customer satisfaction but also drives brand loyalty, willingness to spend, and overall marketing effectiveness.
Hyper-personalising goes further than segmentation
While segmentation creates customer groups based on shared likes, dislikes, and activities, hyper- personalisation drills down to minute differences which can be used to target customers’ at the individual level. Traditionally, organisations have used customer segmentation as part of their marketing strategy in attempt to ensure customers receive relevant communications and offers, but struggle to achieve deeper levels of personalisation through this tried-and-true method.
While increasing segmentation efforts appears to be a good approach, it will not result in the best ROI or maximise program effectiveness. AI-powered hyper-personalisation delivers optimal results by allowing companies to tailor their marketing efforts at the individual level by using data gathered on that specific customer. For example, personalised product recommendations or unique discounts can be shared using unique customer data such as psychographics or real-time engagement with your brand. This segment-of-one approach allows you to optimise whom you target with key messages and offers through the most relevant and appropriate channels.
Hyper-personalising delivers a more individualised experience
As brands compete for consumer attention in a crowded digital landscape, they should look for opportunities to interact with customers more efficiently and make offers with the highest probabilities for conversion. Organisations can use customer data gathered during the customer journey, and combine it with information from external sources to engage with consumers and predict what they want before they have a chance to even look to a competitor.
Hyper-personalising can be applied throughout the customer journey, from attracting customers with personalised webpages and dynamic pricing to providing personalised services after the purchase when cognitive dissonance becomes so important. Unlike with mass media, where marketers can only assume which customer type or segment may view and identify with a specific advertisement, hyper-personalised advertising uses the same platform and underlying data to present one of a multitude of targeted offers based on who is viewing the offer.
Organisations like Amazon continue to experiment with personalisation after the advertising phase, seeking to increase sales conversion through the use of recommendation engines that serve customers with the exact product they’re looking for. While this experience is so seamless that customers may not even realise personalisation is occurring, customers now expect brands to act like Amazon and predict the products that fit their needs.
Why does hyper-personalisation matter?
As more companies have adopted personalisation along the customer journey, from product design to outreach and from the consumer experience to dynamic pricing, it has created a certain level of expectation for personalised interaction among consumers. Gone are the days of mass media where general advertisements to all potential consumers would successfully engage a wide variety of customers. Technology now allows for every interaction to be unique and personal, and consumers expect a personal connection with the companies with which they interact.
According to a study conducted by the University of Texas, the need to personalise comes from the citation to control and simplify decision-making. Personalised product selections and interactions create an experience through which customers are the centre of all corporate decisions, and gives them greater control over the interaction. This further influences customers’ decision processes as the information presented is tailored to their personal needs, and is most relevant to what they require. This tailored information also makes it simpler for customers to decide on the products and brands they prefer.
The combination of convenience, customer understanding, and emotional engagement drives loyalty in customers, and increased returns for organisations. Emotionally engaged, loyal customers not only spend twice as much as those who are not engaged, but 80 percent of them will recommend the brand to friends and family.
A study by Gartner finds that brands risk losing 38 percent of their existing customer base due to poor personalisation efforts. Customers have come to expect brands to use the data they share to understand and reflect their needs, and provide a more tailored shopping experience. By ignoring personalisation, brands risk higher customer fallout rates at all stages of the consumer funnel, lower return on advertising investment, reduced customer loyalty, fewer impulse purchases, and higher product returns from customers who do not feel the brand or product understands them or their needs.
Organisations are now facing competition from non-traditional, digital-first brands
Traditional marketing and business models are becoming increasingly outdated as digital, data-first and direct-to-consumer brands penetrate marketplaces. This is making digital marketing increasingly crowded, leading to increased spending in hopes of reaching customers. And as a consequence of the increased intensity of outreach, three out of four customers have indicated they receive too many email promotions from brands and 69 percent have unfollowed brands they once followed on social media. These trends point to a lack of consumer interest in the content or offers they are being served.
Given fierce competition, digital advertising is becoming increasingly expensive. Studies indicate that over the last two years, digital ad spend has increased 12 percent, with no discernible increase in results.
To effectively compete, organisations need to make a meaningful impression on their customers, taking full advantage of the limited exposure available. Hyper-personalisation is a means to cut through the noise and provide customers exactly what they are looking for. It assists customers with decision-making, and fosters deeper relationships that will keep them from seeking out competitors.
Technology is enabling advanced marketing solutions and consumer interaction
With more connected devices and robust data models, organisations are finding unique means of collecting data and connecting with customers. Historically, customer data could only be gathered at point of sale and was mostly expressed by customers themselves. However, the usage of online tracking through cookies and other means allow brands to gain a deeper understanding of customer preferences and behaviour.
There are various tools which enable this level of customer data to be efficiently utilised, including customer data platforms and loyalty programs. This data can then be combined with third-party data from social media, and censuses, and ethically shared among peers to establish a detailed description of customers and understand them far beyond traditional customer segments.
Data collection has also been augmented through the advancements of analytics and AI technology. AI allows organisations to sift through vast amounts of information in real time and make decisions on the types of interactions to have with customers. This can be done by using customer information to send individualised product recommendations, pre-populate applications, inform chatbots, and empower employees with relevant information.
The combination of data and technology is disrupting the traditional means through which organisations interacted with customers. Data and technology is now enabling organisations to reach customers through targeted media with content that is relevant and uniquely tailored to them.
