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Personalization: Use Your Customer’s Data Wisely

Posted 19 February 2016 9:00 AM by Danny Muller @ MoxieUSA, @Danny_Moxie

Agencies, marketers and brands use the buzzword “personalization” to describe how experiences can be tailored to individual customers. Personalization potentially means that customers will have a better user experience when their individual choices and behaviors are reflected back to them in positive, meaningful ways. By teaching our clients about personalization, marketers are seeking ways to improve their customer relationships and keep their brands relevant.

Let’s give a simple example of personalization. My wife and I want to entertain some new neighbors for dinner. The best way to do this is to prepare a meal that will meet and exceed the expectations of our guests. So how do we do this? By using our knowledge of the individuals involved and preparing our food and drink according to their preferences. 

For purposes of our illustration, we will call this couple Ted and Alice. We know the following basic attributes about Ted:

TED
Gender: Male
Age: 45 years old
Preferred sport: Cycling
Health: Has type 2 diabetes
Food preference: Tofu stir-fry with vegetables
Wine preference: Pinot Noir
Beverage preference: Sparkling mineral water
Allergies: Cats

ALICE
Gender: Female
Age: 42 years old
Preferred sport: Has practiced yoga for 10 years
Health: Suffers from chronic back pain
Food preference: Baked fish, preferably salmon or trout
Wine preferences: Chardonnay
Beverage preference: Lemonade-flavored Vitamin Water 
Allergies: None

Taking all of this into account, we prepare a meal that balances the preferences of the couple. We pay attention to the most important elements; otherwise the dinner could be a fiasco. For instance, we prepare a meal appropriate for Ted’s diabetes, since the wrong food choice would make his blood sugar spike. We provide a chair that supports Alice’s back. We spend extra time cleaning the dining room to make sure it is devoid of cat hair and dander and relegate our cat, Cleo, to the guest room for the evening. We provide Chardonnay and Pinot Noir as our wine choices. The evening goes well, and we get to know our new neighbors better. 

By treating our guests to a customized experience, we were successful in our goal of having a nice dinner with Ted and Alice. We paid attention to the details. We offered food and drink that were attractive to our guests. We succeeded in keeping Ted from entering rooms in our house that were full of cat hair. We chatted amiably about our lives and the neighborhood. We had a good time.

So what did we get out of this experience? Did we have any ulterior motives for this dinner? As a matter of fact, we did. It so happens that there has been a rash of burglaries around our subdivision, and we would like to get a Neighborhood Watch started. By treating our neighbors to dinner, we successfully raised our concerns and received Ted and Alice’s support for the Neighborhood Watch in a friendly way.  

What does my example have to do with personalization in marketing? Brands are trying to do the same thing: They want to provide positive experiences for their customers, and they have many motives for doing this. ROI is a big one. Brand loyalty is another. Responding and adapting to the needs of customers is something that all companies aspire to do well. And brands have lots of data about their customers to play with in order to make this a reality. In fact, there’s a great New York Times article on this very subject.

My wife and I knew our neighbors’ preferences by interacting with them, being observant and asking questions. A brand can know all about its customers by paying attention to its interactions with them — in stores, on its website, via mobile devices, at special branded events, etc. The more channels of interaction a company has, the more data it can collect about its customers. 

Taking all of this data and using in a meaningful and beneficial way is the big challenge. It’s one thing to provide customers with the appropriate product and/or service when they ask for it. It’s something else entirely when companies use this information to stalk customers in unwelcome or inappropriate ways. 

We’ve all had the experience of shopping on a website, then doing a Google search and seeing ads for the items we just purchased moments before cluttering the page. This is annoying at the least, and paranoia-inducing at the worst. Nobody wants to have “Big Brother” watching our every activity and following our every purchase. But like it or not, this is what happens when you make a purchase or browse a website — your behavior is recorded and tracked. Brands need to be ethical and responsible when they use our personal data or risk losing customers forever.

Let’s restate our initial assertion: Personalization potentially means that customers will have a better user experience when their individual choices and behaviors are reflected back to them in positive, meaningful ways. So when a brand decides to use our data, it had better do so in a way that appeals to us and improves our experience. 

Here is an example where personalization could make a big difference and improve the brand/customer relationship. 

A large restaurant chain is struggling with its brand image, which has been seriously tarnished by a series of food poisoning incidents. Since the brand has always pitched itself as a great place to eat healthy and organic food, the fact that people are getting sick eating at its restaurants has been a major blow to its core business. Social media is buzzing about pending lawsuits brought by disgruntled customers who became ill due to the tainted food. The brand desperately needs to rebuild its customers’ trust. Customers need to feel like the company is doing everything in its power to turn the negative situation around — and quickly.

Would personalization help in a situation like this? Definitely. On the surface, it would appear that this is a company-wide issue that would be much better handled across the board to all customers. So why would you want to personalize a message to your customers about food poisoning, since all of the different demographics have been affected equally? The fact is, although the media has reported this as a chain-wide epidemic, only a few restaurants in certain regions have been affected. The critical message needs to go out to those individuals who have eaten in the specific restaurants where the outbreaks occurred. The restaurant chain can tell its affected customers how it is fixing the problem and improving its food service preparation protocols so that this never happens again. This is where targeted customers can be offered some real incentives to stick with the company. The brand can offer these specific customers their favorite meals for free (personalized for each individual based on his/her known preferences) or even provide BOGO promotions, etc., which would be cost prohibitive to implement throughout the entire chain. Although personalization would be one aspect of the brand solving this situation, it could be an important one because customers would feel the brand cares about them as individuals — and not just as sources of revenue.

The key takeaway: no amount of personalization is going to work unless it resonates with the customer. As we guide our clients through the potential benefits and pitfalls of personalization, we must adhere to the following principles:

• Use customer data wisely to improve the user experience
• Do not push products or services that do not fit the needs of the specific customer 
• Do not be intrusive 
• Do not make assumptions about the user 
• Don’t be creepy — don’t use data that cannot be logically traced back to interactions with the brand
• Always treat the customer with respect
• Provide positive experiences for the customer

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