NRF's Big Show, Day Three: Personalization Takes Center Stage

NEW YORK — Personalization is an increasingly crucial area for companies to focus on if they want to avoid obsoletion in today's competitive retail landscape, speakers said on day three of the National Retail Federation’s Big Show at the Javits Convention Center.

In his Tuesday morning talk, Pano Anthos, founder and managing director of XRC labs, stressed just how important personalization has become and urged companies to listen to customers and give them the freedom of choice rather than dictate their terms to them. He pointed out that one reason Starbucks is so successful because it has taken a highly commoditized product—coffee beans—and appealed to the desire for personlization. The result? It is able to charge $5 for a latte. Starbucks, he mentioned, listens to its customers. Similarly, Walt Disney was known to spend months out of the year sleeping in his Disneyland apartment so that he’d be able to interact with customers. "Are we personalizing enough?" Anthos challenged attendees, setting the stage for the speakers who followed to offer some possible answers.

And speakers agreed that the retail industry could certainly be doing more on that front. For instance, Anthos pointed out, while e-commerce has addressed customers' desire to see what their peers have thought of products or services they're considering, the physical store has, by and large, not addressed the reality.

Of the same mind was Alexa Fleischman, CEO of Strypes, whose start-up is addressing the ever-evolving need for individualized experiences through an interactive 3-D platform that can be embedded in retailers' e-commerce sites so that shoppers can customize products. According to Fleischman, increasingly, customers "want to represent their personal brand" and not "fit into a crowd." 2017, she said, is the year that customization grows into true personalization.

This trend is becoming particularly apparent in the beauty industry, where customers are expecting technology to help them try on and find the products that are tailored specifically to their needs.

During a Monday afternoon breakout session, ModiFace's CEO, Parham Aarabi, showed how the vendor's facial recognition and rendering technology can be applied to solve one of the industry's biggest challenges: looking for and trying on makeup. According to Aarabi, one would be hard-pressed to find a company in this particular vertical that is not tackling the issue in one way or another. Of the 70 brands ModiFace serves, Sephora was singled out as a leader, but Aarabi warned that companies shouldn't simply copy what that company is doing because it has worked for it. What works for "Avon won't work for Leneige," he said. While the underlying engine the company uses can be identical, different considerations must be made, including the goals of the brand, use cases, and buyer demographics. Aarabi sees potential with the application of augmented reality (AR) for searching for and trying on clothing and other tasks where people would like a more hands-on experience of a product.

Personalization was also addressed in a Monday breakout panel discussion moderated by Chris Field, director of Retail Connections. HSN’s executive vice president of marketing and digital commerce, Ryan Ross, noted that it’s important for the Home Shopping Network broadcasting brand to personalize digital experiences for customers, as well as the messaging they are exposed to on the phone, and the content they are exposed to. The goal, for HSN, is to always keep the conversation going with customers.

During a breakout session, representatives from the Walgreen's store chain elaborated on the pluses of diving head first into a personalized marketing program. Since 2012, Walgreen's has been implementing a strategy to connect with customers on a one-to-one basis through its "Thank You" campaigns, said Mindy Heintskill, vice president of loyalty and personalized marketing at Walgreen's. For the company, which has worked with Emnos, a provider of software that serves to mine customer data for insights into their preferences, it has proved fruitful to design personalized customer offers. She suggested that other companies make an effort at leveraging data because intuition, on its own, "is not good enough." She also highlighted the importance of not risking a relationship simply to meet a marketing objective. "If you waste an opportunity to stay relevant, you'll get an unsubscribe," she said. Also important is to keep testing, optimizing, and innovating, because what works now will not necessarily continue to be effective.

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