January 16, 2019 CPG, Financial Institutions, Personalization, Retail, Telco, Travel & Hospitality

Putting Personalization Into Play

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Every brand is working to deliver personalization as effectively as they can, and with good reason. Personalization can reduce acquisition costs by as much as 50%, lift revenue by 5% to 15%, and increase the efficiency of marketing spend by 10% to 30%. However, according to Ascend2, 63% of marketers list personalization as one of their top challenges. Numbers like these, and cautionary tales told by experts like Gartner that “marketers must tread light in their personalization efforts to appease both consumers and regulators” make personalization seem much more difficult than it is. In fact, a key to easy personalization is loyalty, simply due to the fundamentals of the data exchange inherent in loyalty initiatives.

Through loyalty, a customer self-identifies, attributing the data you’re collecting across omni-channel touchpoints to a real human. This gives you a holistic customer view of your customer, what we call the GoldenProfile, that shows you who your customer really is, what their behaviors are, and their value to your brand and even their predictive value to your brand. Without attribution, you’re using data from broad, anonymous segments to create experiences for customers regardless of their current or predictive value to your brand. With loyalty data, you can tie interactions and transactions to a single person, allowing you to measure how well your campaigns perform. If you don’t know precisely who you’re reaching, how can you measure the true ROI of your campaigns? What if your highest performing campaigns only appealed to one-and-doners who you’re unlikely to see again? Quickly, campaigns and offers for anonymous customers can become quite costly if they’re not being used to grow a continuing relationship with your brand. Design experiences for the people you know, and personalization flows easily.

When customers opt in to loyalty, they expect that brand to know them and to know them well. This is easily done through loyalty fundamentals – you know who your customer is through self-identifiable programs – in which hundreds of interactions are collected through a dynamic loyalty platform. This actionable data repository gives marketers a holistic view of the member from which they can personalize offers and content, but equally as important to the customer experience is the fact that loyalty technology gives employees real-time insight into how to lift the customer experience for your members. At a glance, your front-line team can see who is checking in or purchasing an item and, with the freedom to do so, can take action in delivering the added personal touch that creates a memorable brand experience. Every time a loyalty member checks in to a hotel, the concierge shouldn’t be asking if they ever stayed at the hotel before, rather they should have the customer’s favorite tea ready waiting for them in the room. Similarly, email campaigns should have relevant offers to them and use the motivational drivers to recognize the customer and show appreciation.

When campaigns are highly relevant rather than generic, personalization escapes the creep factor. This is the value exchange of loyalty – customers volunteer information in exchange for benefits. This exchange should continually build and escalate between the brand and the customer, for each action the customer takes, the brand should reciprocate with added value to the customer.

This data exchange also eases concerns around General Data Protection Regulation (GDPR), California Consumer Privacy Act (CCPA) and other data privacy laws. Part of the process of joining loyalty is that customers accept the program’s terms and conditions. These explicitly state that customers are agreeing to the collection and use of data for the benefit of the program and agree to receive offers, content, etc., all of which they can opt out of, at any time.

Gartner suggests “more data doesn’t always make for more resonant personalization,” and we agree that marketers shouldn’t be collecting data for the sake of collecting – particularly since we’re seeing marketers struggle to action on the insights they already have.

Rather, marketers should be focusing on collecting the right data and using the right tools that allow them to action on this data in a meaningful way to the customer. A versatile loyalty platform allows you to hone in on the behavioral segments and transactions taken to such granularity that, with the aid of machine learning, campaigns become individualized to the person, at scale, carving out a unique customer journey that bonds the customer to the brand.

As Gartner points out, brands are increasingly allocating budget and resources to personalization – but they’re struggling to personalize in a way that resonates with customers. But what Gartner fails to see is how personalization can be inexpensive and easy to implement – personalization doesn’t need several new martech platforms and millions of dollars to implement. Loyalty platforms pull data in from all sources to build a cumulative view of the customer that serves personalization for pennies on the dollar. Customer-obsessed brands such as Nike and Walgreens are prominent examples of how effective creative loyalty strategies supported by a robust loyalty platform lead to unprecedented growth and reach for a business. Their loyalty programs are world renowned and moved them from pharmacy and shoe stores, respectively, to firms that broke through brand barriers to become the most trusted resources for health and wellness. Ulta credits its loyalty program for breaking it out of its stymied discount retailer image to growing a cult following attracting millions of customers who now trust Ulta as the ultimate source for beauty. With the right partner, your loyalty initiatives can be up and running in weeks, enabling your personalization, easing your budget and carving out your brand as truly distinct from the competition.

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