Personalization Becomes an Imperative for Brand Loyalty

Personalization is becoming a consumer expectation and a brand imperative to engender customer loyalty.
Monetate’s 2017 Personalization Development Study benchmarks the state of personalization by analyzing the real-world practices of more than 130 senior marketers. The study found that for those who put in the effort, personalization is not only attainable but leads to various benefits that positively impact the bottom line.

Personalization has been proven to increase loyalty, drive higher conversion rates and grow revenue, the study says, but many organizations find that creating personalized experiences is challenging and, instead, revert to less effective segmentation strategies.

Personalization, as defined by the study, goes beyond segmentation and testing to provide marketers with the ability to interact with each individual, at any moment, across all touch points, based on everything known about them.

Martin Mehalchin, partner and head of the customer experience practice at Lenati, offered his thoughts on the study’s message to Loyalty360.

“Personalization is becoming a consumer expectation and, therefore, an imperative for many brands,” Mehalchin explained. “In addition to providing an industry-leading software solution for brands executing on a personalization initiative, Monetate has for several years been providing the community with very practical advice on how brands can get started with personalization and then progress their efforts as they mature. Its latest study not only contributes further to the industry’s understanding of how to develop and manage an effective personalization strategy, it also offers evidence of the business impact of doing it right.”

Notably, the study data revealed that companies that were successful in personalization saw improvement in profitability: 95 percent of those that got 3x (or more) return on investment from their personalization efforts increased profitability last year (compared to 77 percent and 63 percent of those that got 2x and 1x, respectively).

Here are some other key takeaways from the study:

A documented strategy: The study states that 79 percent of organizations that exceeded revenue goals have a documented personalization strategy, compared to 31 percent of those that met revenue goals and 8 percent of those that missed revenue goals.

A dedicated—and growing—budget: Companies that exceeded revenue goals have a dedicated budget for personalization 83 percent of the time. What’s more, 88 percent of that group plan to increase their budget for personalization in 2017, compared to 21 and 33 percent of those that met or missed revenue goals, respectively.

An integrated approach: With only about half (48 percent) of organizations that exceeded revenue having a dedicated person responsible for personalization, the study suggests that the most successful organizations have made personalization an integrated part of their operations and charter for all staff, not a siloed project managed by a single person.

Tools to measure success: 88 percent of those that exceeded revenue goals have a measurement system in place, compared to approximately 45 percent of those that met or missed goals.

Application of triggered actions: Companies that exceeded revenue goals use personalization and its outputs to fuel triggered emails 78 percent of the time, for ad retargeting 79 percent of the time and for branded mobile apps 65 percent of the time. 

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