Today’s Personalization and CX initiatives Are Falling Far Short of Customer Expectations

Ernan Roman, President of Ernan Roman Direct Marketing (ERDM), knows a little something about Voice of the Customer research and effective personalization and CX strategies. So much so that he was inducted into the Direct Marketing Association’s Marketing Hall of Fame based on the results companies achieve with ERDM’s VoC research-based CX strategies.  

Roman is scheduled to speak at the 9th Annual Loyalty Expo, presented by Loyalty360 – The Association for Customer Loyalty, which is slated for May 24-26, 2016, at the DoubleTree Universal in Orlando, Florida. Roman’s session is titled, “Today’s Personalization is Broken. Learn the Breakthroughs that Work!” During the session, Roman will be joined by Mike Rude, Managing Director, FedEx Freight Solutions Marketing.

Loyalty360 caught up with Roman to discuss his recent VoC findings that say current personalization and CX initiatives are falling well short of customer expectations.

Can you talk about your VoC research findings and, in particular, about how they indicate that today’s personalization and CX initiatives are falling far short of customer expectations?

Roman: Based on findings from over 15,000-plus hours of VoC research we have conducted among customers and prospects of clients such as IBM, MassMutual, Gilt, QVC and HP, many marketers are kidding themselves when they say they are doing personalization.  

What they are really doing is putting lipstick on old fashioned transactional emails and blasting them from the latest and greatest CRM technology.

Here are some representative quotes:

“What we receive is not smart personalization. They aren’t personalizing the things that matter to me.”

“What they consider personalization is so old-fashioned.

“I want more than just buying history-based emails.”

“With today’s technology, I expect the experiences and emails to reflect my interests and preferences.”

What factors have impacted these findings?

Roman: Three factors have caused the high level of frustration with today's marketing.

Factor 1: The power of technology, especially mobile, is an unprecedented enabler of better informed and faster consumer actions and purchases. To keep up, marketers need to develop strategies for high speed and high relevance engagement. 

Factor 2: Consumers generally, but in particular Millennials, are feeling a sense of tremendous empowerment and entitlement in terms of the high quality of CX and high levels of personalization they expect from brands. 

Factor 3: As illustrated by the Apple controversy, consumers understand the value of their personal information, yet they desire higher levels of personalization. And, per our VoC research findings, Reciprocity of Value is a fundamental requirement for earning the right to in-depth customer information in exchange for significantly improved preference driven personalization.

What are brands doing well in personalization and CX initiatives and where do the challenges lie?

Roman: Brands such as Burberry and Sephora stand out in terms of their commitment to transforming the customer experience across the omnichannel mix and throughout the customer lifecycle.

The biggest challenge is the magnitude of disappointment between what consumers expect in terms of high quality CX and personalization and the mediocre to poor levels of CX being provided by today's marketers.

How would you describe the current state of loyalty marketing and what trends do you foresee in the future?

Roman: Based on our recent conversations with leading hospitality, travel and apparel marketers, their customers aren’t feeling much love or value from loyalty programs. For many of these customers, loyalty is a misnomer. They experience transactional and sales oriented programs versus initiatives which engage them and build brand loyalty. 

In the immediate future, loyalty programs must shift to truly personalized recognition, value, and engagement. Per our VoC research findings, loyalty is so much more than discounts. It’s about earning and crafting a relationship with the brand.  

How important is it for brands to truly listen to their customers?

Roman: At this point in time the answer is unequivocal: Those brands that do not commit to listening and acting on the wisdom and expectations of their customers will perish. There are simply too many alternatives in every sector for consumers to accept mediocrity.

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