The Next in Personalization report finds that companies who optimize their customer experience show higher rates of revenue growth than do those who do not. The closer a company is to the consumer, the bigger the gains will be seen.
Key Takeaways
- With the increase in digital behaviors and COVID-19, personalization is more important than ever. Three-quarters of consumers switched to a new store, product, or buying method during the pandemic.
- As a consumer, it can be frustrating when companies provide impersonal customer service. When seventy-one percent of consumers want personalized interactions and seventy-six percent get frustrated when this doesn't happen, it's not good for the company or customer experience.
- Huge growth and increased revenue are possible with the proper use of personalization. Faster-growing companies drive 40 percent of their revenue from personalization, compared to the slower-growing ones, who only drive 4 percent.
Personalization is not only an important part of a company's capability, it has a higher conversion rate than nearly any other digital marketing strategy. For example, whether the company is a digital native, brick-and-mortar establishment or behind-the-scenes operations, we can help deliver customer orders that are personalized to meet their needs.
With high customer expectations and low loyalty rates, retailers are in a real tight spot. Consumers want personalized experiences, which is harder to achieve than ever before. Roughly 75 percent of people have tried a new shopping behavior in the last 18 months, and 80 percent of those intend to continue with this behavior.
Not only are personalization efforts more successful, but they also generate significantly more revenue. For example, companies that excel at personalization generate 40% more revenue from those activities than those who do not perform as well. Across US industries, shifting to top-quartile performance in personalization would generate over 1 trillion in value. Companies that are leaders in personalization achieve this by tailoring offerings and outreach to the right individual at the perfect moment with the perfect experience.
Changing consumer attitudes are disrupting your industry. What can you do to grow revenue and create long-term relationships with your customers? Check out these seven charts, which show how companies are using personalization to grow customer lifetime value.
Personalization Matters
The proliferation of online interactions has helped increase customer expectations for personalized interactions. This is the result of people seeing e-commerce leaders give their customers a high level of personalization in their engagements from web to mobile and in-person. Consumers now view personalization as the default standard for engagement, and demand this from every business they visit.
A recent report shows that 71% of consumers expect companies to be highly personalized. And 76% get frustrated when this doesn’t happen. If customers are unhappy with their experience, it’s easier than ever for them to switch to a different company. Three-quarters of consumers switched stores, products, or buying methods during the pandemic.
Email Personalization Matter even more
Personalizing emails and marketing content has become an important strategy for brands because shoppers have a strong opinion on it.
72% percent said they expect the businesses they buy from to recognize them as people and know their interests. When asked to define personalization, consumers associate it with positive experiences of being made to feel special. They respond positively when brands demonstrate their investment in the relationship and not just in transactions. Thoughtful touches such as sending a how-to video post-purchase, checking in, or asking customers for reviews generate positive brand perceptions.
Consumers want a seamless shopping experience with easy returns and refunds. That's why they reward businesses that get it right every time. Three-quarters of consumers (76%) say personalized communication is a key factor in their consideration of a brand, yet just 24% say they're receiving marketing messages that are personalized. And 78% said these personal messages make them more likely to purchase from this brand again.
Personalization can lead to a lot of great results. It will encourage engagement and loyalty overtime, and recurrence leads to more data from which brands can design the best product for their customer base. This creates a flywheel effect that builds strong customer lifetime value and loyalty, which is the foundation of any successful business.
Research has shown that personalization usually drives 10-15% more revenue. The more company's are skilled in applying data to grow customer knowledge, the higher the returns. When it comes to marketing for digitally native companies, personalization is not just how they market, it's how they operate.
Personalization is a great way to increase revenue for businesses in various industries. For example, personalizing the customer experience can have a major impact on customer loyalty for many businesses that don’t typically have a direct connection to those customers. Firms in the consumer packaged goods segment that prioritize personalization are far more likely to be growing at a faster rate than slower-growing companies. The research shows that improvements in increasing customer intimacy create competitive advantage – and this becomes even more important as these companies mature.
