This sponsored post is produced in association with Sailthru.
Personalization is one of the most often-heard buzzwords in marketing today — yet get a group of marketers together, and you’ll likely hear as many definitions of the term as there are people in the room. And while it may mean different things to different people, here’s the thing: by its very nature, personalization is an ever-evolving notion. It’s about creating a dynamic environment customized and optimized for every user in order to extract the maximum value from each engagement with them — and extract maximum ROI.
Getting there requires an investment — organizationally and technologically. Marketers need a single view of the customer that enables them to deliver personalized experiences. They need to know how to align their technology and fragmented, silo-based organizational structure to start building that single view of the customer to increase lifetime-value.
And to get there they need a roadmap.
The personalization maturity curve
In an interview with VB, Sailthru’s EVP of Customer Success, Cassie Lancellotti-Young, explained how Sailthru helps clients “move up in their personalization maturity” to a point where they’re comfortable and understand what’s needed to achieve fully-automated, fully-personalized, one-to-one communications at scale.
While every organization is different, all companies can take incremental steps towards the final goal of one-to-one personalization following this maturity curve.
Luckily, it’s pretty straightforward:
Phase 1: Basic batch-and-blast approach — In this first phase, marketers simply stick to single message mailing, like email, where everyone gets the exact same thing. This is still standard operating procedure for many brands, and while it can produce a positive ROI, that return is baseline at best.
Phase 2: Field insertion — In this next phase, companies insert something personal, often the first name, the city a customer lives in, or gender-specific information into marketing messages. Lancellotti-Young cites American jewelry retailer, Alex and Ani, as a successful case study in this early stage of personalization maturity: When they used field insertion alone it increased their open rates by 6 percent.
Phase 3: Traditional segmentation or rules-based messaging — Continuing on, marketers segment their customer base using demographic data such as location, then send marketing messaging relevant to the segment. According to Lancellotti-Young, Alex and Ani used geographical segmentation for a campaign on bangles for local baseball teams. Customers who lived in San Francisco got messaging about bangles for the Giants while New Yorkers got messaging about Yankees bangles. Segmentation increased Alex and Ani’s click rates by 127 percent. Note that this is the stage of personalization maturity where many marketers find themselves stuck, often held back by limitations in their marketing technology.
Phase 4: Behavioral recommendations — Looking beyond what you know explicitly about your customer, this next phase gets into what you know implicitly about them. What do they look at on the website? What are their interests? Could they live in San Francisco but be, in fact, Yankees fans, so they consume Yankees content more? Lancellotti-Young tells VB about Country Outfitter: they used behavioral recommendations to achieve 109 percent lift in email conversion. “With every incremental step taken on the [personalization maturity] curve,” she says, “you get paid dividends in terms of ROI numbers on the metrics that really matter.”
Phase 5: Omnichannel optimized — Every channel is integrated and talking to one another in this phase. Marketing communications are optimized across all channels, not only pulling in data from all these channels, but also actively pushing it out to them based on that single customer view. At this stage marketers can expect an average of 20 percent lift in Customer Lifetime Value (CLV), according to Sailthru’s data.
Phase 6: Predictive intelligence / personalization — Not just looking at data from the past, but using that data to determine what customers are likely to do in the future is the holy grail of the personalization maturity curve. At this stage, predictive intelligence drives personal customer experiences at scale and success at this stage fundamentally changes companies. Think of this as predictive personalization: it enables brands to automatically optimize messaging based on a customers’ future behavior. When you can anticipate what kind of communication a customer will respond to, if they’ll purchase, how much they’ll spend — or if they’re at risk of opting-out — you can personalize content, messaging, calls-to-action and even discounts in a way that optimizes revenue with every engagement.
Learn more about transforming the customer experience — download Sailthru’s Definitive Guide to Predictive Marketing.
The height of personalization maturity
Organizations that don’t have a single view of their customers, and are unable to provide personalized experiences to them, interact like they don’t know them at all. On the other hand, fully mature personalization enables companies to move beyond treating customers like strangers and increases not only customer lifetime value, but the customer lifetime experience and, therefore, their loyalty.
In fact, many organizations stuck further down the curve will lose CLV by focusing more on acquisition than loyalty, as batch-and-blast marketing does. Do you tend to capture lead data like emails through contests and sweepstakes? It’s a quick acquisition strategy and it brings a lot of people through the door quickly. But these leads are 63 percent less likely to convert and 53 percent more likely to opt out of email when compared to leads obtained by other means of acquisition such as paid channels.
This is the essence of the personalization maturity curve: deliver great personalized experiences to your customers and you increase their brand loyalty. You don’t even have to capture leads based on discounting. They’ll willingly convert at full value if you enrich their experiences.
The foundations of omnichannel optimization and one-to-one personalization
To be operating toe-to-toe with today’s consumers requires change. But transformation doesn’t happen in a vacuum — it takes great people, great ideas, and great technology. The greatest marketers of our time are quickly moving up the personalization maturity curve by solving these key challenges:
- Breaking down organization silos: When sales, marketing, and customer success/support teams are all acting independently, it is nearly impossible to achieve true personalization. This business-as-usual structure fails to encourage a single view of the customer, and results in a fractured customer experience that will leave you stuck in the first stages of the personalization maturity curve.
- Ensuring customer data collection: You can’t personalize marketing efforts without knowing your customer: their behavior in each channel, on every device, and at every touch point with your company and how that persists and changes over time.
- Turning data into intelligence: Data on its own is meaningless. Extracting insights using the right technology and analytic platforms is key to personalization.
- Connecting the customer experience: By understanding who the customer is, and their individual preferences, brands can anticipate customer needs. This is what makes for superb customer experiences that keep pace with customers every step of the way: from acquisition, to purchase, to advocacy, to repurchase — over and over.
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