Per management consulting firm, McKinsey & Company, personalization will become the prime driver of marketing success within the next five years. However, 15 percent of CMOs surveyed admitted that they don’t believe their companies are currently on the right track with personalization. To scale up marketing efforts in the age of personalization, McKinsey & Company laid out three major shifts that deserve attention.
Digitalization Of Physical Spaces
The survey data suggest that “offline” person-to-person experiences are expected to become huge for personalization, as 44 percent of CMOs say that frontline employees will rely on insights from advanced analytics to provide personalized, in-person offerings; 40 percent believe that personal shoppers will use AI-enabled tools to improve service; and 37 percent are convinced that facial recognition, location recognition and biometric sensors will be used more frequently in the future
Certain retailers are already successfully practicing personalization in their marketing initiatives. As an example, the researchers use Covergirl’s in-store AI-powered program, enabled by Google’s conversational Dialogflow. The augmented-reality glam stations let customers “virtually test” products. Macy’s, Starbucks and Sephora aren’t far behind, tapping into personalization with the use of geofencing and company apps to trigger relevant in-app offers when customers are located near a store.
Emphasis On Empathy
Today’s consumers, especially the younger ones, care a great deal about empathy, but feelings are not easily adaptable in the digital world. Fortunately, researchers say, machine learning is getting much better at reading and responding to emotional cues. More sophisticated algorithms enable programs to interpret new kinds of data (visual, auditory) and extrapolate emotions much more effectively.
For example, voice assistants like Alexa, are getting smarter and more empathic. With each new upgrade comes new skills. To compare, in 2004 Alexa only had one skill and in 2017 that number grew to 25.
“In time, these advances could help marketers communicate with customers in a way that’s tied to specific moods, offering specifically curated promotions for music or movies, for example, that match that mood,” McKinsey & Company researchers say.
Building A Complete Ecosystem For Personalized End-To-End Customer Journeys
A shopper’s purchasing experience never happens in a bubble. A buyer typically interacts with or benefits from multiple sources. For example, buying a specific branded piece of clothing inside a large department store within a large mall means one consumer touches several organizations. Building smart connections that share insights between all the players in an ecosystem opens up opportunities for personalization, making it possible for brands to deliver more seamless and consistent consumer experiences across all stages of the customer journey.
Additionally, the researchers advise that investments in customer data and analytics will set the foundations for more personalized and seamless marketing initiatives based on factors that really impact consumers.
“Personalization is impossible if marketers don’t have the means to understand the needs of high-value customers on an ongoing basis. So top marketers are developing systems that can pool and analyze structured and unstructured data, algorithms that can identify behavioral patterns and customer propensity, and analysis capabilities to feed that information into easy-to-use dashboards,” they say.
