Let’s Get Personal – Optimizely

Carl Tsukahara, CMO at Optimizely looks at the increasing trend towards personalising the customer experience, and offers advice on how to do it well

With a new personalised AI billboard taking prime position in Piccadilly Circus, and Channel 4 and ITV announcing plans to test personalised advertising aimed at people watching TV in their homes, we are beginning to see the next level of evolution of targeting in marketing. Brands are being forced to seek ever more interesting and insightful ways to attract and retain customer interest and nothing achieves this more than providing customers with an experience they want.

Creating seamless digital experiences across all channels where customers interact with their brand of choice will become a focus for 2018. The only way to succeed will be to treat customers as individuals and provide them with everything they need, when they need it. Brands that fail to follow suit might just fail.

The most forward-thinking brands will use different technologies to build their digital strategies and effectively provide consistent cross-channel experiences for its customers. Set aside budget now to experiment, test and understand the customer’s journey, evaluate the way customers behave and make actionable, outcome-driven decisions to optimise the customer experience through scalable ‘test and learn’ processes and solutions.

This begs the question, how will the role of personalisation and customer experience play out in martech and advertising in 2018 and beyond?

Changes in consumer behaviour
There continues to be a shift in consumer preference towards online and connected devices. While online spending is seeing ongoing growth, the types and volumes of content available for consumption also continue to rise. In order to stay ahead of the competition, businesses have to have relevance to the specific wants, needs and behaviours of their varying types of customers.

As a critical element of these changes, brands must create, experiment and optimize highly engaging digital experiences that allow consumers to be served with a highly relevant experience based on their preferences and experiences that are proven to provide the right business outcomes.

According to Econsultancy, 74 per cent of marketers say they know personalisation increases customer engagement, but only 19 per cent actually use it. This means that implementing personalisation strategies can potentially put you ahead of the pack.

In the case of the Channel 4 and ITV advertising experiment, audience segmentation is used to show different viewers in different households, different, relevant adverts based on their demographic, even though they are watching the same programme. For instance, a family might be shown an adventure-filled staycation deal, while a young couple might be shown a luxurious couples-only retreat through Secret Escapes.

Go where the data Is
To get customer experience right, we need personalisation. And personalisation needs data and experimentation. Get the data right and businesses can ultimately apply statistics, data science and machine learning to create powerful experiences that deliver highly relevant experiences which truly delight their customers, increase revenue and improve loyalty.

Happy customers are proven to deliver higher conversion and larger final basket size. In addition, when such personalisation is teamed with effective digital experimentation, an optimised, evidence-based engagement occurs, driving more revenue and share of wallet for the brand as well as greater customer loyalty.

This is something that leading technology companies like Amazon and Netflix do incredibly well. In a research paper published by Netflix executives, the company claims its AI-assisted recommendation system saves the company $1bn per year. According to the report, Netflix optimises the algorithms through continuous testing by a team of over 70 engineers.

Personalisation essentially allows retailers to deliver programmatic experiences, customised to key micro- or macro-segments of their customers and prospects. Done properly, this looks at behaviour and demographics, evaluating browsing and purchase behaviour, intelligently analyzing variants to determine a personalised match that meets consumer desires and delivers the best business outcome.. Personalisation therefore allows companies to be more specific and targeted in the products and offers that are presented.

Personalising the customer experience
When personalising, it’s critical to measure the performance against targeted business outcomes. It is a hypothesis until it is tested. Assumptions about the best audience segments, and the best messaging for those segments, the best features to present and the best visual experience are assumptions until they have been validated through experimentation.

By rigorously testing different content, offers and features across audiences, businesses can find the best experiences for different segments. This is an iterative process rather than a one-time endeavour. Ultimately, personalisation requires the same inputs and workflow as testing. This includes sound technical implementation, research-driven ideation, a clear methodology for translating concepts into test hypotheses, fact-based predictable outcomes and tight technical execution. Guesswork is not the pathway to success.

As customer expectations rise with the adage of digital noise, the ability to deliver both tailored offers and content that reflect customer interests and proven loyalty will no longer be optional for digital commerce success. Companies should start by focusing on retaining business and personalising the website and mobile experience to the customers who have bought from them before at least once.

This presents huge opportunities for up-selling, loyalty and incremental revenue. As a result, personalisation technology allows for everything from colours, photo types within offers and back end features such as product recommendations and search results to be aligned with what buyers want to see. Hence, we’ll see a rise in adoption of personalisation tech more powerfully teamed with digital experimentation for optimal results in 2018 and beyond.