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Personalization sometimes isn’t actually personalized
Last year, McDonald’s publicized its shift in focus to ‘mass personalization’, increasing footfall and engaging customers on-the-go through interactive digital ads. Most recently they announced a ‘digital’ customer engagement team.
This blurring of digital and real-life channels is a fascinating example of an omnichannel approach to customer engagement
At the same time, Nike has outlined plans to be “more personal at scale” – developing loyalty programs and personalized shopping experience apps such as SNKRS – while Nordstrom has used beacon technology to send personalized messages about sale items to shoppers using the brand’s app in-store.
These examples of investment in personalized technology are certainly significant, but the emphasis on personalization could also prove problematic.
Engaging the Masses, or the Individual?
The term ‘personalization’ is certainly on the cusp of every marketer’s lip, serving as a big buzzword in the age of e-commerce. But as the term begins to be used, overused, and even misused by brands, they ought to question whether it is really what their customers re looking for.
The phrase ‘mass personalization’ in itself indicates that marketers focussing on personalization are simply missing the point. How can brands like Nike and McDonald’s provide truly personalized experiences if they are focused on designing marketing campaigns that are targeted at the masses, rather than tailored to the individual?
To put it directly: personalization is often not very personal.
At a time where one bad experience can encourage a customer to leave a brand, marketers ought to shift their focus away from the misguided use of personalization and begin investing instead in individualization.
Personalization vs. Individualization
Though the two concepts are underpinned by similar ideas, personalization and individualization are fundamentally different.
Personalization has been used by marketers as a segmentation technique for a long time in varying levels of precision and, subsequently, varying levels of success. It is used to target customers with content based on personal details and customer history, using techniques like mail and email marketing, targeted advertisements and product recommendations.
Individualization is the evolution of personalization but is more defined than its predecessor. It is focused on the idea that brands ought to see each customer not as a target but as a unique individual and partner in a trusted value creation process with the brand. It uses technology to identify customer intent and to inform decisions across each touchpoint along the customer journey.
Described by Forrester in its Personalization 2.0: Individualization report as “the New North star for customer-obsessed organizations,” individualization is distinct in that it orbits around the customer.
“Customers, not companies, determine if an experience is personalized. Without the tenets of individualization in place, digital business pros are doomed to forever miss the mark in meeting customer needs and expectations.”
With brands still singing and dancing about personalization, they are failing to really understand their customers as individuals. By continuing to target customers in segments, they truly are missing the mark in terms of meeting their needs and expectations.
A simple way to look at the difference between personalization and individualization is this; if personalization means remembering that the customer likes bean burgers, individualization is already knowing that they’re a vegetarian.
The Key Ingredients
In today’s age of engagement, there’s an enormous appetite for individualization. Certainly, brands are under increasing pressure to provide individual, contextual and relevant interactions with their customers in order to meet their expectations and, crucially, to build trust and loyalty with them.
To achieve this, marketers require a fundamental shift in thinking from the outdated personalization mindset to this individualization mindset. By placing customers at the center of their business and seeing each customer as a unique individual, brands can move away from merely talking about customer-centricity, to acting on it.
If brands are to provide truly customer-centric experiences, they need to use existing behavioral data to ensure that customers’ previous actions, interests, and behaviors are considered and utilized to enhance their experiences across the entire journey.
This is not to say that marketers do not require some personalization capabilities, but to turn these into something far more valuable, brands can delve deeper into their data. This is where context and relevance come in – the key ingredients for successful customer engagement.
To understand customer intent, marketers can’t ignore context. They need to be able to understand the customer journey across all channels and touchpoints. This contextual understanding provides them with the opportunity to pre-empt customer activity and act accordingly to provide relevant and valuable interactions with their customers.
It is by adding context to personalization that brands can deliver truly relevant and individualized experiences, resulting in an on-going value exchange between them and their customers.
Brands already have the data they need, they simply need to leverage these rich insights to optimize experiences and ultimately reap the rewards by instilling lasting loyalty and trust amongst their customers. Whilst Nike and McDonald’s are heading in the right direction, individualized experiences ae the ticket to meet ever-evolving customer expectations.