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Building customer relationships: personalisation – who cares?

By / / In Insight /
Developing a good, relevant and personalised experience has been proven to help marketers with building customer relationships. Research shows that brands sending birthday offers are likely to improve the experience for more than half the 18-21 age group, but for less than a third of the 50+ age group. So who wants personalisation and who doesn’t? Take a look:
personalisation

There’s a huge amount written in the marketing and business press about building customer relationships and how to engage today’s consumers – in particular, millennials (the frequently used ‘m’ word!). Millennials are typically those born between 1980 and the early 2000s, so those who are aged between late teens and mid-30s now (2017).

Millennials are a generation of people who are highly connected, but time-poor. A generation which has a world of opportunity available; a group of people who have a fear of missing out (FOMO), but who are also overwhelmed by choices. They seek flexibility and purpose in their work, often wanting to do things differently from previous generations. They want freedom for all, they have empathy for others all over the world, they believe in tolerance and – crucially – they seek meaningful relationships with both people and brands.

These digital ‘natives’ (people born or brought up during the digital age) have a frame of reference for brand experiences and the bar is set very high. It is widely accepted that they look for seamless, personalised, relevant experiences, based on the experiences that iconic, global brands like Amazon, Apple, Airbnb and Nike have been able to create.

According to new research commissioned by fusion learning and undertaken by Sapio Research, 39% of all consumers (rising to 51% of the 18-29-year-old age group) actually spend more money with brands that personalise their products, services or communications. This clearly shows that good personalised experiences can not only be much more relevant and useful to consumers, but can help to build better relationships. However, given that 91% of consumers told us they think that personalisation can be somewhat intrusive or incredibly intrusive, getting personalisation right presents some key challenges for marketers and other senior leaders. Here we will dive into two key considerations.

Relevance is relative

Firstly, striking the right balance and creating a useful personalised experience rather than an intrusive one is a huge challenge for organisations.

65% of people in our research told us that ‘relevance of the information to them’ is at the heart of a good personalised experience. This includes special offers they might be interested in, special offers on their birthday, or communications received at an appropriate time of day for them.

Unsurprisingly, ‘relevance’ means different things to different age groups. For example, 22% of 18-21-year-olds are likely to be impressed by a brand sending them a message when they are directly outside one of their stores, when they could use that offer there and then, compared to only 4% of 50+ consumers. Brands sending special offers on your birthday are also likely to improve the experience for more than half the 18-21 age group, but for less than a third of the 50+ age group. However, typically it is the simple things that work best. For example, when travelling with Virgin Trains, the email reminder to collect the tickets not only acts as a prompt to collect the tickets, but also updates the customer on the weather at the destination they’re going to and gives them the opportunity to download content and useful apps ahead of time.

A great example of relevance was seen recently when Campbell Soup announced investment in a nutrition-focused start-up called Habit. Habit designs a ‘nutrition blueprint’ for individuals based on their body metrics and goals, blood tests and DNA samples from a cheek swab – all collected via an at-home kit. Once the scientists at Habit have analysed this data, they create a unique, personalised meal plan for each individual, including the ideal ratio of carbs, fat and protein for that person. They develop meals based on these results and deliver them to your doorstep. This science-based approach to personalised nutrition, once available only to a very select few, is being democratised. (Source: Fortune)

Context is key

Although older millennials did not grow up with smartphones, this is a cohort that is arguably now dependent on (or even addicted to) technology. They send instant messages as a primary form of communication, they turn to the internet as their primary news source and they use social networks to help them connect and belong. This matters when it comes to personalisation because 68% of people told us that the amount of information they are prepared to share varies by brand, type of product or service, depending on where they can see the potential value and how engaged they are. The more engaged a generation is with an industry, the happier people are to receive a personalised experience from that sector. It’s therefore probably no surprise that 38% of 18-21-year-olds are happy to receive a personalised experience from a social media brand compared to only 18% for the total population; 42% of 18-21-year-olds are even happy to receive personalised adverts from a social media brand versus 28% for the total population.

Interestingly, consumers are most likely to be happy receiving a personalised experience from retail (45%) brands than other sectors, with 50% of 18-21-year-olds and 45% of those aged 50+ saying they are happy to receive a personalised experience. Personalisation is something that British online retailer very.co.uk has applied very successfully. Its data scientists ensure that customers see personalised content whenever they visit the website homepage. This means there are 1.2 million possible versions of the very.co.uk homepage with products, promotions and search results all tailored via an algorithm to the individual customer based on their preferences, previous buying behaviour and even the local weather! The retailer is helping their customers navigate the myriad options available, saving them time and therefore also improving the likelihood of a purchase. (Source: Retail Week/Campaign)

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Building customer relationships: top tips for successful personalisation

  1. Be empathetic – Always start by getting closer to your customers and understanding the journey they take with your brand, whatever their age group and life stage. Do you understand your customers’ attitudes, needs, interests, what they value and how you can make their lives and decisions easier and simpler?
  2. Ensure you’re aligned internally & foster a culture of collaboration – Without senior management alignment and effective collaboration, personalisation will be extremely difficult to achieve. Is there a common understanding within your organisation of what personalisation means to different customer segments and how it can help you achieve your overall business objectives?
  3. Be transparent to build trust – Transparency and trust is key to getting the balance right on this topic no matter which customer segment you are targeting. Have you created very clear and simple communications about what data you are collecting, why you are collecting it, as well as what you plan to do with it?

To download fusion learning’s white paper on personalisation, click here.

Have an opinion on this article? Please join in the discussion: the GMA is a community of data driven marketers and YOUR opinion counts.

Read also:

Service with a smile: Marston’s – customer engagement on tap (case study)

#WalkersWave & Burger King ‘OK Google’: risk-taking personalisation explored

Nina Aggarwal
Author: Nina Aggarwal
Founder & Global MD at fusion learning | fusionlearning.com

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