The value of getting personalisation right. Personalisation is not only a crucial capability, it’s one that punches above its weight, no matter whether the company is a digital native, a brick-and-mortar player, or a behind-the-scenes producer or supplier.

Consumers don’t just want personalisation, they demand it. With store and product loyalty more elusive, getting it right matters. Roughly 75 percent of consumers tried a new shopping behaviour in the last 18 months, and more than 80 percent of those intend to continue with new behaviours.

Furthermore, research found that companies that excel at personalisation generate 40 percent more revenue from those activities than average players. Across all industries, shifting to top-quartile performance in personalisation would generate over £1 trillion in value. Players who are leaders in personalisation achieve outcomes by tailoring offerings and outreach to the right individual at the right moment with the right experiences.

The data shows how consumer attitudes around personalisation are changing and what outperforming companies are doing to grow customer lifetime value at scale.

Personalisation matters more than ever before

The surge in online interactions since the onset of the pandemic escalated expectations—giving consumers more exposure to the personalisation practices of ecommerce leaders and raising the bar for everyone else. From web to mobile and in-person interactions, consumers now view personalisation as the default standard for engagement.

McKinsey research shows that 71 percent of consumers expect companies to deliver personalised interactions. And 76 percent get frustrated when this doesn’t happen. Ratcheting up the pressure on companies, if consumers don’t like the experience they receive, it’s easier than ever for them to choose something different. Three-quarters of consumers switched to a new store, product, or buying method during the pandemic.

Research shows shoppers have a strong point of view on personalisation

Seventy-two percent said they expect the businesses they buy from to recognise them as individuals and know their interests. When asked to define personalisation, consumers associate it with positive experiences of being made to feel special. They respond positively when brands demonstrate their investment in the relationship, not just the transaction. Thoughtful touchpoints such as checking in post-purchase, sending a how-to video or asking consumers to write a review generate positive brand perceptions.

…And consumers reward those that get it right

Seventy-two percent said they expect the businesses they buy from to recognise them as individuals and know their interests. When asked to define personalisation, consumers associate it with positive experiences of being made to feel special. They respond positively when brands demonstrate their investment in the relationship, not just the transaction. Thoughtful touchpoints such as checking in post-purchase, sending a how-to video or asking consumers to write a review generate positive brand perceptions.

Performance propels outperformance

Research shows that personalisation most often drives 10 to 15 percent revenue lift (with company-specific lift spanning 5 to 25 percent, driven by sector and ability to execute). The more skillful a company becomes in applying data to grow customer knowledge and intimacy, the greater the returns. For digitally naive companies that forge a data-backed, direct-to-consumer model, personalisation isn’t just how they market, it’s how they operate. Those leading the charge in personalisation also have better customer outcomes. Their focus on the relationship and long-term value leads to better upward migration, retention, and loyalty. Personalisation can be an inconvenient truth as an earlier article explains.

Personalisation can also be a revenue accelerator even for businesses that typically lack direct access to customers such as companies in the consumer packaged goods segment. Among these companies, those with the fastest rates of revenue growth were far more likely to prioritise personalisation than slower growers. The research suggests that even small shifts in improving customer intimacy create competitive advantage—and these benefits grow with maturity.

Outperformers organise their business around personalisation

Companies that achieve the best results from personalisation approach it differently. Rather than seeing personalization solely as a marketing or analytics problem, they view it as an organization-wide opportunity. Rather than focusing solely on short-term wins, they look for long-term drivers of growth and emphasise customer lifetime value.

Here is what out-performers can do to accelerate personalisation and create value:

They lean into data and analytics to identify opportunities. Looking across the customer life cycle, leaders build a granular view of where there is the most value. They leverage customer segments and micro-segments, and factor in behavioural, transactional, and engagement trends. They use those insights to define and quantify their personalisation objectives and ground their efforts in customer-centric key performance indicators (KPIs).

They invest in rapid activation capabilities powered by advanced analytics. Leaders develop at-scale content creation and AI-driven decisioning capabilities so they can respond to customer signals in real-time. They leverage predictive analytics and models to determine what content and messages to serve which customers (for example, propensity models, or predictive next-best-action algorithms).

They also establish robust measurement processes that track the impact of customer interventions and feed that information back to their systems and teams. These processes help them deliver the right content through the right channels at the right moments in a consumer’s journey.

They invest in fit-for-purpose martech and data. Rather than letting a “thousand flowers bloom,” personalisation leaders target a specific set of customer outcomes and use cases that support them. They align organisational resources around these use cases and work back from the desired outcomes to build the data and martech road map and identify the enablers and investments needed to deliver.

They commit to an agile operating model. Businesses that succeed in scaling personalisation create teams that cut across marketing, product, analytics, and technology, using a hub-and-spoke approach. Each hub owns specific elements of the personalisation journey, with each spoke empowered to build underlying use cases. Together, these teams run hundreds of tests per year, enabled by advanced data analytics and test-and-learn techniques.

They invest in talent and training to refine capabilities. Leaders bring a similarly data-driven approach to building their teams and organisational capabilities. They focus in on the skills needed to support personalisation at scale (for instance, digital and e-commerce acumen, advanced analytics, product management, or performance marketing).

Then they map these capabilities against their current talent base, using the results to inform hiring, training, and upskilling. This approach allows companies to anticipate the expertise and tools they need as their personalisation program advances.