Customers today are continually raising their expectations for relevance, and marketers are responding by placing a greater focus on personalization. Unfortunately, individual marketing still often eludes them, because it’s just not achievable through segmentation-based marketing strategies. True individualization—what we call 1:1 personalization—is only possible with the use of machine learning (ML) and artificial intelligence (AI). That’s why ML and AI solutions like Formation are likely to play a large role in the future of marketing.
You may be excited to see what an AI and ML solution can do for your brand right now, yet be held back by concerns around implementation and budget. After all, the technology you choose will need to integrate with your MarTech stack, and gain budgetary approval from the powers that be.
We’ve developed a 3-step process that has helped marketers at multiple large enterprises build a business case for investment, prepare for implementation and ultimately move from a segmented marketing approach to a much more effective, individualized strategy.
To develop a holistic view of each customer, you need to integrate data from that person’s interactions with all of your brand’s touchpoints and data sources. Since that can be tough, we recommend starting with the highest value data: mapping transactions to each customer. Formation can help you complete this mapping quickly to provide significant insights into customer behavior. You can then build on those insights over time with data from other touchpoints and sources.
As a more multidimensional picture of the customer emerges, Formation can analyze all of their behaviors across your brand’s customer journey and identify which are the most valuable to achieving your objectives.
Once you understand your customers’ most valuable behaviors, it’s time to build your dynamic offer templates. These variable templates that allow every aspect of your offer to be individualized. We recommend starting with just two to three offer templates, so you can build a business case with a limited initial investment, and so Formation’s technology can learn about your customers, enabling you to scale new behaviors and offers later.
After you’ve chosen your dynamic offer templates, select the business objective you’re trying to achieve, such as boosting incremental revenue or maximizing profit. Once these two parameters are set, Formation’s ML and AI solution will automate your marketing offers, personalizing multiple variables for each consumer. Offer creative, rewards, required actions and duration will all be individualized. This automatically scales your decision-making power—you can just choose the templates and objectives that align with your strategy, and Formation automatically makes the offer relevant to each customer.
The last part of this step is tracking your customers’ interactions with the personalized offers. Formation’s machine learning will track these behaviors in order to automate reward fulfillment, and to measure response for offer optimization going forward.
Formation is designed to get offers to market quickly, both for efficiency and to help you learn as you scale. Our end-to-end experimentation feature helps you safely, incrementally and reliably test your initiatives in-market. Your team can set up experiments with rigorous control groups and then learn as you test, rather than waiting to perfect every initiative before launch.
Measure the results of your experiments against your critical KPIs and objectives. Then assess them with short-term metrics, such as purchase completion, and long term metrics, like customer lifetime value (LTV). Leverage your successes to build a business case for scaling additional offers to cultivate other valuable customer behaviors.
As offers are scaled, Formation creates an automated feedback loop, providing a continuous pipeline of results and customer engagement data for each of your behavioral offers. As machine learning continuously optimizes and improves the efficacy of your offer, you will be able to see the results of that optimization in real time.
Get ready for the next evolution of marketing
Much like digital transformation defined the last decade, individualization will define this one. The brands that do it right are the ones most likely to maintain a loyal customer following. To prepare your brand and your team for what’s next in marketing, download our white paper “The Future of Marketing: Relevance + Value.”