Every day we are faced with a barrage of branded content. Companies want us to make a purchase, visit their website or spend our valuable time learning more about their offerings. The average consumer is exposed to nearly 600 marketing messages each day, according to an Accenture consumer survey. And most of them – 80% in fact – say they either ignore traditional ads or block them when browsing the web.
Needless to say, marketers face an uphill battle trying to break through the noise and get consumers to take notice. The key is focusing on customer retention and delivering content that is uniquely interesting to them. Our recent Brand Loyalty 2020 report noted that 79% of consumers agree that the more personalization tactics a brand uses, the more loyal they are to that brand.
That’s where individualization comes in. Using this strategy, which requires insights derived from a variety of data sources and advanced technology to scale, marketers can develop messaging, content and offers that speak directly to each consumer. This approach increases the likelihood that consumers will pay attention to their brand and engage, while giving companies the results they desire, whether it be greater customer loyalty, increased sales or revenue growth.
Individual marketing is the practice of gaining a single, omnichannel view of a customer. Collecting very detailed personal information, and possibly combining it with other third-party data sources, enables brands to achieve an unprecedented level of relevance in its offers, messaging and promotions to each customer.
Brands aspire to reach this apex of marketing because individualization can deliver a variety of proven results, including building customer lifetime value, brand advocacy and a boost to the bottom line.
There's a lot of confusion about what to call this very granular approach to marketing. Some refer to it as personalization marketing, others 1:1 personalization, and still others individualization marketing. Though it may just seem like semantics, there are some real distinctions in the nomenclature.
Personalization is much like segmentation or micro segmentation, using basic customer data - such as purchase history or similarities in demographics – that enable tailoring messages to a defined group of customers. While focused on smaller groups, personalization is still more of a mass marketing approach, since it results in development of generalized messaging aimed at like-minded individuals.
Individualization, also referred to as 1:1 personalization, takes the process several steps further, focusing on a segment of one. Individualized marketing messages speak directly to each person, connecting with them on a level that acknowledges their unique preferences, habits or needs that may not be shared with others in a micro segment or personalized cohort. Individualization is data-driven, using rich insights from a variety of sources to understand current unique consumer interests and delivering the right message at the moment of optimal interest to achieve desired results.
Traditional segmentation and personalized marketing require a high level of manual intervention. A Demand Metric study noted that 27% have a manual process, 40% use some automation with manual processes, 28% mostly automate the process with occasional manual intervention, and 5% use a completely automated process.
Using traditional marketing tools that require manual processes, one campaign for a single segment can take up to 16 weeks to get out the door. It requires cross-functional teams to work together in selecting the promotional value, creative, details and delivery channels, as well as managing the results. Due to the manual processes of running a variety of segments, the size of the team required would make this approach impossible to achieve true individualization.
Automation is what makes individual marketing possible, because it helps synthesize the data, then deliver insights to create unique offers, promotions and messages. A high level of automation also will streamline the process, giving brands real-time visibility into the content individuals engage with in order to fine-tune offers and adjust strategies.
At the heart of creating individualized customer experiences is artificial intelligence (AI) and machine learning (ML), which facilitates constant analysis of the audience and tuning of promotions. AI is used to determine insights about the customer (motivations, propensities, preferences), while ML is applied to improve the business outcomes over time, such as the best promotion for an individual customer based on continued analysis for his or her actions.
The combined power of automation, AI and ML can make the offer creation and execution process faster, enabling millions of different promotions, each one for an individual customer. to be developed and refined in real time. These tools and use of individualization techniques are delivering results. Not only do they help create offers that get consumers' attention and improve engagement and the customer experience, they also can deliver revenue growth of up to 10% more - two to three times higher - than those who do not rely on individualization, according to Boston Consulting Group research.
Learn more about the Formation hyper-personalization platform.
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