The 3 Stages of Personalization
Just as toddlers learn to get around in stages, businesses looking to win over the large number (48 percent) of customers who will unsubscribe from email marketing that they find irrelevant or annoying must move forward in three stages—crawl, walk, and run, according to a recent report from Gartner.
By following these three stages of personalization, companies have a better chance of delivering messages that are relevant and helpful to consumers, the report concluded.
In the crawl stage, companies customize web content based on observable data, such as new or repeat visitors, visitor preferences, and geography. The report cites automotive software company vAuto as an example: The company asks visitors to select a segment, such as franchise or independent dealer, and reconfigures its site accordingly.
Companies in the crawl stage typically personalize their websites and email on the fly, but they’re not yet at a point where they can connect data across those channels, explains Martha Mathers, managing vice president at Gartner. The data they have is usually very basic and “does not require a lot of complex integration or analysis to determine what happens next,” she adds.
Companies in the crawl stage are “making smart first steps with personalization and just getting started with one channel, maybe two at most,” Mathers says.
Companies in the walk stage have advanced slightly to the point where they can bring in additional data, segmentation, and channels, allowing them to tailor integrated, multichannel marketing and digital commerce experiences to the context of customers’ journeys. The report cites beauty retailer Sephora as an example: Its digital marketing strategy targets prospective loyalty customers across Facebook, display advertising, and email marketing.
“Companies [in the walk stage] probably aren’t personalizing across a huge variety of channels,” Mathers says, “but they are picking up more contextual elements. They might be able to tell that you’re on a mobile device or that you filled out a form, displayed a certain action on the website, or clicked on an email, and that will trigger an additional piece of content.”
The run stage sees personalization permeating the entire customer journey, with companies using tailored content and interactions to assist customers in advancing through each stage. The report cites department store Nordstrom as an example: The retailer sends out retargeting emails promoting discounts on brands in which users previously showed an interest.
“This is truly multichannel personalization. It’s going to reach across your website, showing up in search, reflected in digital commerce and in email communications,” Mathers says. “There’s a sequence of messaging that you should receive; you’re going to get personalized product recommendations and next-best actions based on things that you’ve done.”
Companies in the run stage have also started to ramp up their testing capabilities: In the crawl and walk stages they’re testing to see if personalization is worth it; in the run stage they’re testing to see which type of personalization will get the best response and how it can be scaled and replicated across consumer segments, according to Mathers
Other traits of the run stage include a larger range of data from first-, second-, and third-party sources; more sophisticated customer analytics; test results; look-alike modeling; and even some experimentation with artificial intelligence, she points out.
Mathers warns, though, that personalization alone is not enough. Customer communications must also be helpful, and companies can use personalization to achieve that goal. This means helping consumers across their buying journeys with messages that might teach them something new, save them time, or provide some reassurances, she explains.
“When you combine [personalization and helpfulness] together, magic happens. If you produce high-quality content that a consumer perceives to be helpful, and you personalize it based on some data that you have…personalization in that sense becomes an amplifier,” she says.
One company that has mastered this is diaper company Huggies, which, according to Mathers, can personalize its homepage off of a single data dimension, such as the expected due date of a new baby or a child’s birthday. Using that information, the homepage changes dynamically to offer relevant product recommendations or featured information. “If you’re an expectant mother, they’re helping you think about packing your hospital bag, the first couple weeks at home, which types of diapers the infant is going to need. If the birthday shows that the child is a toddler, there’s content around potty training, pull-ups, and transitioning the child out of diapers. Just one single piece of data personalizes the entirety of that website experience,” she says.
And in the end, companies with that level of personalization should be able to run all the way to the bank.