Winning with customers requires that businesses move beyond building preference for a brand, even beyond building loyalty. Consumers don't want to consume, they want to love. They want to engage on an emotional level, in a way that is relevant and rewarding.
Most marketers accept the idea that personalization is the future of brand-consumer communications. But realizing that vision requires a fundamental change in how marketers think about their consumers and how they measure success.
You can make the case that building intimacy with consumers is similar to building relationships with friends. By understanding what is unique to them and leveraging that knowledge to build constructive dialogue, brands can cultivate a relationship that engenders loyalty -- and if you're lucky, brand love.
With consumers driving more content creation via technology, marketers must take the evolutionary step and learn to build that relationship.
Many marketers already have the tools they need to realize the benefits of personalization, but most insist on using the same tired techniques when examining "average" consumer behavior. The myth persists that consumers within the same demographic will behave in identical ways.
For example, the "average 32-year-old female" evokes a snapshot image of a married mother of two in a middle-income household of four.
Picture this: Anna is 32. She is single, earns $90,000 a year, and owns a condominium in a trendy urban neighborhood.
Her grocery trips tend to be frequent and quick, and Anna spends little time meandering through the aisles. Instead, she moves deliberately, straight from fresh produce, to cheese and wine, to frozen meals, stopping for a few items in the personal-care section as she checks off her list.
Now another picture: Julia is 32. She and her husband are both employed and pool an annual income of about $150,000. Their schedules are packed with extracurricular activities for their four children. Julia grocery shops just a few times a month and makes an occasion of it. She scours aisles for new convenient but healthy products, browses the magazine aisle, and, as a treat, grabs a latte at the Starbucks kiosk.
In reality, the commonly held view of a 32-year-old female can be wildly different from how actual people in that demographic engage with a brand. Not only do Anna and Julia's lifestyles diverge from that of the "average" 32-year-old woman, but their behavior is much different.
Consumer research often reveals a frustrating disconnect between perception and reality -- what consumers claim to want and what they actually purchase.
For example, while some indicate that email is their preferred way to receive offers and coupons, many shoppers actually demonstrate a higher use of direct mail. Similarly, while some consumers tell us that they never purchase chocolate, their in-store transactions tell a different story.
Behavioral data is a powerful tool for deciphering that disconnect and more intimately understanding the consumer—what they actually want vs. what they say they want.
When brands struggle to form personal bonds with consumers, the problem often does not lie with their methods but with their failure to create relevant and engaging messages.
Through customer-relationship management or loyalty programs, for example, many brands have a fairly comprehensive picture of consumers at a household level, including purchase behavior and online interactions.
Yet even with this valuable information, marketers often continue to diligently distribute a single, generic communication to their entire database only because their audience members are demographically similar.
How many brands say they want to target moms and describe them as the average 32-year-old female? As a result, companies often struggle with low redemption rates and CRM programs that can't maintain loyal subscribers.
Even if they are demographically similar, consumer needs and preferences for engagement can vary dramatically. For instance, one segment might appreciate convenient options and prefer to print digital coupons; another could seek healthier solutions and find value in health-related articles, while others may seek meal solutions through dish-pairing suggestions and recipes.
By looking at the differences and similarities in purchases and online conduct, behavioral-driven segments let communications focus on the lifestyle of the household as a conduit for delivering value and rewards.
Appealing to consumers' unique needs and concerns enables brands to differentiate their message from irrelevant offers targeting the same demographic. It gives their audience a reason to open an email, engage with the brand and build constructive dialogue that rewards them for engaging.
Across the spectrum of consumer packaged goods and beyond, companies that commit to personalized marketing have seen redemption rates increase nearly 65%—skyrocketing above the industry average.
Segmenting groups of subscribers according to their behavior lends itself naturally to customizing and delivering pertinent messages, and consequently, forging meaningful and enduring relationships with consumers.
When businesses turn to behavior-driven strategies, they are wisely shifting gears, moving away from relying on their communications to recruit and retain consumers and toward providing the content consumers want to see.
The goal of personalization is to achieve relevance with consumers and realize that vision requires an individual-level understanding of the consumer. Using the "average shopper" as a model is probably similar to the insights being deployed by a competitor and no longer an effective go-to market strategy.
Understanding consumers through their behaviors will more clearly separate the winners from the losers in the near future. Brands now have the power to interact directly with their consumers, and personalization can increase engagement, helping to add to a single, intimate view.
Consumers are telling us what they want. It's our turn to show them we're listening.