PERSONALISATION HAS BECOME CRITICAL TO IMPROVING BUSINESS PERFORMANCE
As the digital age offers up new ways to fight for customer mindshare and dollars, consumer-facing organisations are responding with new efforts to personalise the customer experience—and reaping big rewards in the process.
Imagine arriving at your favorite neighborhood restaurant. For 20 years, you’ve been ordering the lasagna. This evening, your server has put your order in early— and now he’s bringing you spaghetti. You are puzzled. Replicate this experience at scale with millions of customers, and you get to the heart of the customer challenge for consumer-facing organisations today. Companies that fail to show customers they know them and their buying preferences risk losing business to competitors who are more attuned to what their customers want. And the ranks of those competitors are growing. In a new survey of more than 600 business executives by Harvard Business Review Analytic Services, 47% say their organisations are already executing tailored customer communications successfully across all channels. “People today expect personalisation,” says Isabelle Birem, senior vice president of loyalty for France’s Accor S.A., a multinational owner, manager, and franchisor of hotels, resorts, and vacation properties. “It’s just something you have to do.” Indeed, nine in 10 survey respondents say their customers now expect them to know their interests and anticipate their needs. “When they make purchases, they expect to receive personalised recommendations that are helpful and relevant,” says Farrell Hudzik, senior vice president and enterprise customer engagement officer for U.S.-based consumer financial services firm Synchrony Financial. “When they reach out to us, they expect us to know who they are. When they reach a chatbot or live agent, they expect us to know what they’ve been inquiring about on a digital property.” All that is reason enough for companies that aren’t personalising the customer experience to start. Or for those that have only dipped their toes into the water to jump in feet first. But the rationale extends beyond meeting customer expectations. Personalisation also has become critical to improving business performance. Simply put, personalisation drives better financial results. Eight in 10 survey respondents say personalisation is now important to their organisation’s strategy, and more than half say it is an important driver of their revenue and their profits.
Even more—81%—say it will be an important driver of financial performance in 2020. Not surprisingly, 54% of survey respondents also say investing in personalisation is a high priority for their organisations. Why? To achieve primary goals of improving customer relationships (cited by 63% of respondents), driving customer retention (54%), and driving revenue (38%).
Moving Beyond Table Stakes: Using Personalisation to Gain Competitive Advantage
Given the early wins it’s delivered, it’s no surprise that personalisation is quickly becoming the norm in many areas of marketing. Nearly half of survey respondents now see personalisation as table stakes, for example, in email marketing, print marketing, and search advertising— whether they’ve personalised their own activities in that area or not. “If we don’t do it we will lose customers,” says Harsimrat Kaur, CRM insight manager for Costa Coffee, a U.K.-based multinational coffeehouse. In a very real sense, those table stakes arenas are starting points for organisations that have thus far lagged behind in the personalisation revolution—capabilities they must nail down quickly so they can move on to more innovative and higher return personalisation techniques that survey respondents say can deliver real competitive advantages. Among those higher-order activities: personalised product offerings and recommendations; personalised online experiences, including greeting customers with personalised home pages; personalised pricing strategies; and personalised mobile applications that can do things like push notifications to customers based on their location.
WHICH PERSONALISATION TACTICS DELIVER A COMPETITIVE ADVANTAGE?