It is not enough to deliver the services and products customers want in today’s highly competitive marketplace. Companies that can build trust and loyalty are those that will truly make a difference. Organizations looking to distinguish themselves from their competition face many challenges in creating that feeling of loyalty.
Hyper-personalized messaging and experiences are the only way to create those connections. Customers feel that they are supporting brands that share their values and who understand them. Companies can build customer loyalty and generate incredible revenue by engaging with customers on a personal level.
Personalization goes awry
Although personalized messaging can be a powerful tool to build genuine relationships with customers, few companies can maximize its potential. This is often due to a purchase-focused approach, which constantly pushes people to buy to achieve short-term revenue goals.
Instead of trying to understand why customers are buying, they often just want to sell. This strategy is often ineffective. Anyone who has ever received promotional messages following a purchase similar to theirs can attest to how inefficient it can be. It puts the revenue needs of the business above what the customer may want. Personalization should be the main focus.
These efforts can be complicated by insufficient data. Personalization for some marketers can be as simple as using demographics and purchase history to group people into one of several potential buyers. This thinking is flawed because it misunderstands customer motivations. It is difficult to determine what customers might want or need next because knowing who bought something doesn’t give much insight into how they bought it. This is similar to driving down a street and noting which houses have red paint. Then you send the owners offers to buy more red paint.
A Better Approach to Personalization
Artificial intelligence is used to improve personalization by analyzing every customer interaction and touchpoint. This allows for a deeper understanding of individual motivations and behaviors. With AI technology, it’s possible to achieve this form of hyper-personalization at the scale and velocity necessary to create what feels like segments of one.
However, gathering this information is only one piece of the puzzle. Customers shouldn’t find it intrusive or irrelevant. Forrester found that there are some basic rules for responsible and respectful personalization.
1. Be relevant
Personalization is a way to build relationships that last. It shouldn’t be solely transactional, just like any healthy relationship. Customers don’t always want to buy the latest products and services from companies. They rarely will. They will still want to hear about the things that matter to them. This utility builds trust, and customers are more likely to remain engaged with a brand. It also opens up the possibility of future purchases.
2. Be authentic
Companies that can connect with customers on a personal basis form stronger bonds. Even the most skeptical consumer will often choose a brand because it understands them and presents itself authentically. Personalization must be based on the customer, not on what they buy or who they are from.
Personalization strategies that engage on an individual level make people feel valued and appreciated. This approach can seem forced or superficial without the right information. Therefore, it is important to have solid data insights into what motivates people to deliver a genuine message. AI can provide these insights due to the sheer volume of data needed to build a complete picture of customer motivations.
3. Don’t Overdo It
Marketers tend to stay top of mind in a multichannel, crowded media environment. However, a lot of marketing efforts can become irrelevant or ignored if they are too much. Personalization strategies are becoming more popular, so it is important not to come across as intrusive. Customers can set their terms of communication, including when and how they want to be contacted. This is a great way to build trust and respect and will help you to create a long-lasting relationship.
Based on what works
Personalization is becoming more important. A McKinsey report showed that 71% of consumers want some type of personalization. 76% of them are also frustrated by receiving generic messaging. While most companies know the immense value of personalization strategies informed AI-driven insights, they aren’t always sure where to begin. Instead of starting with the hard task of building loyalty with infrequent customers or lapsed customers, they can refine their strategies by focusing only on the best customers.
Many companies are quite adept at engaging their most engaged customers via a loyalty program, member incentives, and other less complex forms of personalization. These customers are likely to have greater loyalty to the brand than the average customer and will be more open to mistakes in messaging. AI platforms can identify patterns and motivations easier because they have more data. Memberships and loyalty programs can encourage members to share more information about themselves, such as by asking questions or inviting them for feedback.
language-driven AI engines can analyze customer interactions and other data to create a profile of the ideal customer. This is based on their motivations. Machine learning generates unique narratives that can be continuously refined to create predictive responses that will inspire people to engage with the brand.
This hyper-personalized, precise messaging can be adapted to consumers’ changing motivations and needs, allowing them to receive the right content at the appropriate time. These lessons can be used to establish relationships with more customers and potential customers. As AI messaging becomes more sophisticated, it will be easier for them to understand and predict.
Personalization on Scale: The Power of Personalization
Personalization strategies that work depend on large amounts of unstructured data, which can only be processed with powerful AI tools. It is possible to create a nuanced understanding by analyzing millions of customer interactions. This will allow you to determine which messages work best under different circumstances. This is just the beginning of a more transformative approach to personalization. It can help organizations move from broad, profile-based marketing towards a personalized approach that treats every customer as an individual.
Motivation AI can identify the preferences of customers and create content that resonates with them. This technology allows organizations to personalize their customer relationships and scale up their personalization efforts. These relationships will enable forward-thinking companies to increase brand loyalty and provide greater value for their customers.
