Personalization at scale: 3 steps to transform a buzzword into a core business practice
If you hit the ground running soon, you have a great chance of achieving these three steps within a matter of months.
Since the advent of the internet, industry luminaries have held up the vision of 1:1 personalization: the ability to tailor customer experiences automatically based on their digital behaviors. In reality, the journey to personalization has been slow, complex and expensive, and for many brands, that vision has come to seem like a mirage.
However, I witnessed a huge surge of interest in personalization at scale in 2018. I believe there are two reasons for this: First, brands know they must embrace bold strategies to compete with digital-first brands like Amazon and Netflix. At the same time, traditional batch-and-blast campaigns became increasingly ineffective in a marketing-saturated world.
Since founding Aster Data in 2005 (a big data innovator acquired by Teradata in 2011), I've helped top global brands that, despite major investments, still struggled to put customer data in the hands of marketers. Marketing remained highly dependent on scarce tech resources — data analysts, analytics experts and channel experts — to build even a single campaign.
I realized that in order to achieve personalization at scale (i.e., dynamically tailoring every interaction that every customer has with your brand, based on their unique wants and needs), brands needed a data layer that could centralize, connect and integrate personalization with the following:
• Data unification: An extremely flexible data store that ingests raw, granular data from any source and automatically organizes it so marketers can understand and use it.
• Centralized decision making: The ability for marketers, aided by AI-powered opportunity discovery, to make intelligent decisions based on all that rich data.
• Cross-channel execution with 1:1 messaging: The ability to execute those decisions instantly by seamlessly connecting to any execution channel, while automating 1:1 personalization based each customer's most granular data.
There are many ways to achieve this. Some companies design and build their own platforms using data lake and enterprise warehouse technologies. Others commit to monolithic marketing clouds that integrate data and cross-channel execution. Lastly, smart hubs or customer data platforms (CDPs) — which my company offers — have begun "productizing" personalization by automating and integrating the key processes.
Whatever strategy you ultimately choose, 2019 is the time to act. A 2017 McKinsey report found that only 15% of retailers had fully implemented personalization strategies. That leaves plenty of room for brands to achieve differentiation. With that in mind, here are three steps to fast-track your journey to personalization at scale in 2019:
1. Commit the C-suite to a personalization-at-scale strategy in Q1 2019.
There is no need to begin with a month-long, heads-down study of personalization scale. However, personalization is by nature cross-functional, requiring both input and buy-in from IT, product, martech and analytics teams, as well as marketing.
To secure a top-down commitment, you need to clearly articulate the potential business value to the C-suite, which ranges from incremental revenue to increased marketing productivity and campaign ROI.
Each brand is different, but here are just a couple of examples of what I have seen brands achieve:
• By creating a single view of the customer across all data sources, an omnichannel retailer gave marketers access to customer data and enabled them to build and validate intelligence-driven audiences, resulting in a 70% reduction in both time and effort to create personalized campaigns.
• Instead of wasting mindshare and money on existing customers or low-value targets, a global media brand was able to decrease the cost-per-acquisition of customers by 50%. It now has response and conversion data across all channels, the ability to find high-value audiences across any dimension and automation of suppression lists to all channels in real-time.
2. Use a current campaign to map personalization processes.
Chances are, you are currently working on a campaign involving some degree of personalization (for example, a relatively straightforward cross-sell campaign using past purchases, product details and browsing behavior). Instead of merely building a one-off campaign, you could turn this into an opportunity to evaluate the current state of your personalization processes by:
• Mapping each step across the entire process.
• Tracking how long each step takes.
• Estimating the number of resources each step requires (i.e., data experts to gather data and build lists, analytics experts to discover opportunities, and channel-specific experts to execute).
Afterward, conduct a post-mortem with key cross-functional stakeholders. Questions to ask include:
• Could marketers complete all the tasks on their own?
• If not, were they working in close-knit, cross-functional teams, or did they wait in multiple queues for tech experts?
• What queues were particularly long?
• How difficult was it to measure the success of the campaign (i.e., lift and ROI) across multiple channels?
3. Use the test case to build consensus for integrated, automated personalization.
If your brand has undertaken time-consuming, costly customer data integration initiatives that yielded few real-world benefits, key players from marketing, IT and analytics teams may be resistant to testing out new solutions that address the same challenges.
However, the personalization test case will reveal its own set of bottlenecks and hidden costs. Use this newfound clarity to build consensus for a fresh approach by:
• Mapping a new solution: Examine step by step how a modern, integrated approach to personalization can shrink current costs and timelines by speeding up, connecting and automating processes.
• Building on collaborative relationships: Mapping and measuring current processes requires cross-functional collaboration and insight sharing. Leverage these relationships to build momentum for evaluating new personalization solutions.
• Understanding ROI: By estimating the real costs involved in your test case, you can better measure the ROI of your current personalization efforts — and gain a baseline against which to gauge the ROI potential.
If you hit the ground running soon, you have a great chance of achieving these three steps within a matter of months. With that foundational experience, you can build a far more effective and efficient personalization road map, from high-value use cases to organizational changes and technology investments.