Personalization, trust and customer loyalty
Is your website 520 years out of date?
Or are you using modern technology to its full potential?
Catalogs: creating customer convenience
In what was possibly a global first, Aldus Mantius - a publisher from Venice - created a catalog of the books he was printed in 1498. This was possible because 15th Century Europe was going through a publishing revolution, thanks to the Gutenberg press opening up a world of mass publishing.
From that (possible) beginning, catalogs went on to become mainstream, enduring well into the modern era thanks to a host of benefits: their easy, accessible format; comprehensive listings of products and pricing; and, the way they established an ongoing two-way relationship between vendors and customers.
The decline of the catalog and rise of the ecommerce website
The catalog's dominance over retail came to an end with the advent of the internet and the emergence of the website, which also ushered in significant changes for brick-and-mortar stores.
But, despite technological innovation, the vast majority of today’s ecommerce websites are not too far away from simple and ancient catalog businesses. The website is convenient for your customers, combining your product catalog, price list, and order form.
But it could do more.
This “more” is made up of personalization, at a previously impossible scale. Printing an entirely different catalog for every single customer (or even customer group) is cost-prohibitive, as is altering the layout of a brick-and-mortar store for each new shopper.
The website is not just an acquisition channel. It touches every point of the customer journey, including customer retention and brand engagement.
Consumers have high expectations of brand relationships. They expect to be remembered, to have their preferences catered for, to be valued. Otherwise, they won’t come back.
Personalization and loyalty
70-80% of customers are one time purchasers, only around 20% repeat. And, just like the Pareto principle dictates, these 20% of customers drive the top 80% of revenue. This means retention, loyalty, is a big issue. Fortunately, it is one where personalization can have a big impact.
Personalization is about context. With an ecommerce website, you know where a customer is on their journey, their preferences, and other insights. This means you can give them consistently give them relevant information and experiences. Doing this well means you become trusted.
As Jeff Weiner discussed, trust equals consistency over time.
Personalization enables you to build a relationship where customers are happy to share their preferences and opinions, and for brands to use that insight to curate experiences, across the entire customer journey, because you are always relevant.
Brands can use personalization to turn that post-first-purchase period into the pre-next-purchase period. To deliver great experiences and customer service, to become habit-forming and delightful for customers.
Creating a personalization program built on trust
A personalization project is about freeing up data and putting it into action. Top tips for implementing a personalization strategy include:
- Collect relevant data points according to your business goals and customer journey.
- Make sure you take the time to understand your data, create hypotheses and test them.
- Have a way to use the data in real time (at the right time, the right place and with the right message).
- Set metrics for how you will measure success.
Part of the puzzle is segmentation. It is an intrinsic part of personalization, and what makes it scalable. When you’ve got the tools to tailor how you treat one group of people, the marginal cost of curating experiences for the remainder is trivial: so brands should look at creating a meaningful segmentation strategy.
Then, you can look at delivering these personalized experiences that are tailored to each customer group. These need to have an impact: they should be experiences that matter to your customers and your brand, which are worth measuring and iterating on. Things like delivering personalized student pricing, making it easier for customers to top-up and reorder, or recommending the perfect product for midnight shoppers.
Regardless of the experience, speed and relevance are key: personalization must be contextual: someone booking travel wants their baggage sorted before they reach the airport, a big event is a now-or-never scenario, a long-time customer will run out of their favorite product this week.
The goals of personalization are context and relevance. That’s when customer interactions become relationships, and when consistent experiences, delivered over time, create trust and loyalty.
The full version of this article appeared in RetailTouchPoints on 21 December 2018.
Emre BaranRead More