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At Loyalty360, we’ve been seeing, for quite a long time actually, that personalization is extremely important. In discussions we’ve had with thought leaders in the customer loyalty space, personalized marketing has come out as a goal that many brands are seeking. That is, brand representatives are no longer asking whether they should start personalization initiatives, but rather how to do so.
A newly released, annual study from Evergage and Researchscape International confirms what we’ve seen. The study shows that, for 88 percent of respondents, personalization is the main thing they seek to accomplish through their companies’ loyalty programs. Other key motivators for personalization include increasing customer loyalty (59 percent), generating measurable lift/ROI (50 percent), and driving more leads (44 percent).
“While personalization delivers demonstrable hard benefits, it’s interesting that they’re not the primary triggers for personalization investments,” says Andy Zimmerman, Chief Marketing Officer at Evergage. “Instead, there’s a great appreciation for the fact that being genuinely helpful, removing points of friction, increasing relevance, and making people feel acknowledged and valued are simply good for business. Companies overwhelmingly recognize that personalization is an inextricable part of a good customer experience and want to deliver on that.”
Data shows that, increasingly, companies are seeking to put the individual person at the center of their marketing efforts. By applying artificial intelligence in the form of machine-learning personalization, marketers are able to communicate at the one-to-one level. Now, 40 percent of marketers employ machine-learning personalization, using algorithms and predictive analytics to present recommendations and experiences tailored to individual audience members. This is a 54 percent increase over results in Evergage’s 2018 study.
In addition, among those not yet using machine-learning personalization, 42 percent plan to do so in the next year. Also, 68 percent currently deploy rule-based personalization, which delivers experiences to segments of customers based on set criteria.
“Segments are still a very important way to power personalization, and that approach isn’t going away,” says Karl Wirth, Evergage CEO. “But there’s a limit to how granular you can get, both with your segments and with experience delivery. Machine learning, in contrast, empowers marketers to act on data in an individual’s profile and, faster than the blink of an eye, transmit the most relevant experience possible, whether the person is a known or anonymous visitor, and whether they’re on your website, in your app, receiving your triggered or batch email, receiving a push notification, dialed into your call center, at your kiosk, etc. With algorithms that keep getting smarter, machine learning delivers on the promise of one-to-one communications across channels and in a scalable way.”
Nearly all respondents to the Evergage study, 98 percent, noted that personalization advances their customer relationships, with 70 percent describing the impact as “strong” or “extremely strong.” In addition, 90 percent of respondents reported a measurable lift in business results attributable to personalization. Other notable benefits of personalization, based on the study, include increased conversion rates (61 percent), increased visitor engagement (59 percent), improved customer experience (56 percent), and increased lead generation/customer acquisition (56 percent).
Clearly, the idea that personalization isn’t a necessity is just incorrect at this point. Studies like this one from Everage have been surfacing for a while now to support this conclusion. Still, the number of companies actually using machine-learning to drive personalization is still below 50 percent. We urge brands to follow the data and begin adopting artificial intelligence.
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