Embracing the Customer-First Mentality
In today’s age, personalization is no longer a value-add; it’s table stakes. As consumer privacy laws continue to progress and third-party cookies dwindle away, identity should be central to your marketing efforts. According to Salesforce’s State of the Connected Customer Report, 66 percent of consumers expect companies to understand their unique needs and expectations, and 52 percent expect all offers to be personalized. Gone are the days when a one-size-fits-all approach was enough to attract and maintain quality leads.
With consumers expecting personalization in nearly every interaction with a brand, having robust identity data is the difference between success and failure. As we all know, using someone’s first name in an email isn’t enough for the modern consumer. Truly meeting your customer where they are requires the right channel, the right message, and the right timing. This means having the most complete and up-to-date picture of consumers at all times.
Who Is the Modern Consumer?
Consumers today are accustomed to “smart” everything—from home automation devices and automobiles to appliances and jewelry. According to the Cisco Annual Internet Report, the number of devices connected to IP networks is projected to climb to more than three times the global population by the end of this year, with 3.6 networked devices per capita. New immersive consumer experiences continue to generate an ever-increasing flood of data, and companies that fail to put this data to good use are falling behind. McKinsey Research found that faster-growing companies drive 40 percent more revenue from personalization than those who grow at a slower pace.
Back in 2007, market research firm Yankelovich ran a survey of 4,110 people and found the average person sees up to 5,000 ads every day. Today, that number is even higher, with the average person seeing around 10,000 ads per day, though only a quarter of that or less will be relevant.
Historically, personas played a central role in understanding, segmenting, and targeting consumers. By dividing consumers into groups based on demographics, income, occupation, or location, marketers can draw conclusions about what that individual may want to see. While this approach may help marketers gain a high level understanding of various audiences, it falls short when it comes to keeping quality customers engaged.
In addition to rejecting one-size-fits-all marketing efforts, the modern consumer regularly interacts with multiple connected devices and channels throughout their journey. In the United States, the average household has a total of 22 connected devices. With a world of content at our fingertips, the way consumers learn, research, and buy products or services has changed drastically, bringing new channels and marketing opportunities into the mix.
Consumers will continue to have more and more choices in terms of products and purchasing options. With the cost of living on the rise and a healthy dose of uncertainty for the future, consumers are gravitating toward products that not only provide the best value, but brands that they can trust in the long term.
Leveraging First-Party Data
With new opportunities to win over consumers that were once inaccessible, realizing the potential of these platforms will require a heightened focus on identity resolution and using universal identifiers for greater cross-channel correlation.
Improving the customer experience involves sending consistent, personalized messages across all channels based on who the consumers are, where they are in their life, and their buying journeys. With a clear picture of customers and prospects, marketers can turn conversations into conversions. On the other hand, by not prioritizing cohesion and consistency, marketers could inadvertently chase customers away with irrelevant, off-putting, or conflicting messages.
A consumer who doesn’t own a car, for instance, will quickly dismiss offers for car insurance and quite possibly the company behind it. Understanding consumers must be an ongoing process because their behaviors, preferences, and lives continually change. Reaching out to them at different inflection points and growing along with them leads to better customer experiences, better brand perceptions, and greater customer lifetime value.
First-party data is a brand’s most valuable asset—it’s the artifact of a consumer who has expressed an active interest and consented to provide their data as part of an interaction. For 2023 and beyond, brands need to focus on building out their first-party data as their source of truth for evolving customers while filling the gaps in consumer profiles. By expanding the full identity of first-party audiences to include key demographic, lifestyle, and behavioral traits, marketers take control of their data and gain independence in their ability to reach audiences at scale with maximum personalization.
The expectation for personalization is especially prevalent when a customer has a pre-existing relationship with the brand. Twilio’s 2022 State of Personalization Report stated that nearly half (49 percent) of consumers say they will likely become a repeat buyer after a personalized shopping experience with a retailer. Conversely, 62 percent of consumers say a brand will lose their loyalty if they deliver an impersonal un-personalized experience.
Going Above and Beyond
Brands that stand out will be those capable of communicating with consumers across all channels as if they know them. Yet 40 percent of companies feel that getting accurate customer data for personalization is a challenge. That’s why more marketers are teaming with reputable, third-party consumer behavioral data partners and identity resolution specialists to meet these goals:
- Enhance the value of their first-party data.
- Gain insights into their customers’ preferences and permissions.
- Understand what their customers want and their likely intent for the future.
- Improve the relevance and timeliness of their offers based on when customers are in-market.
- Confidently deploy a consistent and personalized omnichannel approach.
While first-party data provides crucial snapshots of consumers and prospects, including key demographics, this data can only go so far. Third-party behavioral data—specifically in-market behavioral data—enhances marketers’ peripheral vision, even as consumers change their behaviors. Marketers can respond in near real time to what their prospects and customers are doing across the web, whether they’re entering the market for the first time or comparison shopping online.
For example, insurance companies use powerful, accurate data to feed AI algorithms that customize policies for their prospects on the fly based on a single-step form. Through AI, they create convenience while significantly reducing the time and labor involved in any transaction. As AI becomes more accessible, we can expect to see similar industries follow suit.
If you still consider personalization a nice-to-have rather than a critical component of your marketing initiatives, you’re falling behind. Leveraging first and third-party data helps you to make informed decisions that boost performance and improve marketing ROI.
Behind each of your customers is a deeper story. With differing interests, behaviors, and lifestyle data information, no two customers are exactly alike. Understanding what makes them unique is key to refining your personalized outreach strategy.
Dylan Purse is the director of product management at Verisk Marketing Solutions. He has helped marketers enhance their customer data for twenty-five years advising on industry best practices to achieve optimal campaign results.