Brands, How Do You Love Me? Please Personalize the Ways
Once you’ve built a foundation of trust, which we discussed last week, you can take your consumer relationships to the next level.
To do this, you need to “know” your consumers. Just like in a real relationship, staying on the surface won’t cut it. You need to go deep. This requires gathering everything you know about each consumer into a single customer view.
But having this data picture of your consumer isn’t enough; data itself isn’t valuable. Data drives insights that then drive action—the action is the critical and valuable part of the equation.
When you know your consumers well, you can take action by personalizing the experiences they have with your brand. Commonly, we see personalization in the tailoring of targeted and retargeted advertising messages (email, SMS text, social media, etc.) and dynamic website content, especially from direct-to-consumer (DTC) brands.
Consumers expect brands to know them and to provide them relevant engagement via personalization. This is especially true for the Gen Z population; 62% of Gen Z likes ads that provide them value, according to a Criteo study.
But personalization is not just tailoring the content, it should also include prediction of behavior and timing of the message delivery.
In the case of dynamically modifying website content, there is a need to predict the consumer’s behavior so that your brand can serve up product recommendations, special offers, etc. These predictions and the optimization of content needs to happen rapidly, like in real-time.
While not much research has been done on consumers’ patience regarding the speed of dynamic website content, if we use overall website speed as a proxy, consumers won’t tolerate slow speeds.
This is especially important for younger consumers. One of the first global surveys on Gen Z conducted by IBM found that 60% of those surveyed would not use a website or app that they deemed as slow. More recent studies have confirmed the importance of site load speed. This survey from 2020 had a similar statistic (57%) stating that consumers would leave an ecommerce site and shop elsewhere when frustrated by slow speeds.
Timing of message delivery is also extremely important. It is quite common for brands to deliver content at a specific time of the day to coincide with when a consumer is expected to be most active on that engagement channel. But timing should also be related to their specific engagement journey with the brand. Getting this timing wrong may not only reduce the probability of a sale, but also sends a message that you don’t truly know the consumer, which can drive a wedge between the brand and the consumer’s loyalty.
Interestingly, personalization could also include not personalizing the content. Let me give you an example.
Let’s assume I briefly visited a DTC website and provided some personal information, such as my name and contact information. But during my visit, I was distracted and ended my session before doing much browsing. Let’s also assume the brand has a customer data platform (CDP) and uses identity resolution. The brand will automatically start stitching together other third-party data about me in an effort to build a more complete customer profile.
But if I was to receive a retargeting email that did more than address me by name, it is going to feel fake and slightly creepy. In this case, the brand should not build a message that is too specific even if they do know more about me as an individual.
Finally, it is important for a brand to provide consistency across all the channels that a consumer interacts with. From a consumer’s perspective, a brand’s corporate website, a DTC site, its call center, and ads on streaming media services are all from the same entity. The expectation is that the messaging and content will feel consistent and relevant. Consumers, especially millennials and Gen Z, are highly tuned to authentic messaging and its converse, fake posturing.
Why is all of this so important? It comes back to trust and brand loyalty.
People want to engage with brands that are empathetic to their needs; and empathy requires understanding. For brands that get it right, the payoff is in loyalty and market share. McKinsey found that relevant and useful ads could drive revenue growth of 10% to 30% for retailers. While a CPG brand probably won’t see those kinds of metrics outside of DTC, there is certainly value in understanding your consumers.
While this all sounds good on paper, the devil is in the details. In late 2019, Gartner predicted that, “By 2025, 80% of marketers who have invested in personalization will abandon their efforts due to lack of ROI, the perils of customer data management or both.”
Clearly there are challenges to overcome.
Next week, we will talk about enabling technical capabilities and look at brands that have used their deep understanding of consumers to create brand enthusiasm and increase sales. In the meantime, checkout Episode 4 of CPG Bytes where we talk about CPG advertising in the “New Normal.”