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Five reasons why hyper personalization should be part of your marketing strategy

February 23, 2024  By Erwin Busselot

Consumers today are increasingly engaging with brands that deliver tailored services, offers and communications. They want to have their preferences identified and experiences customized. Think Netflix that employs multiple data points to recommend the best films for each individual viewer or Amazon’s use of purchase history data to make product recommendations and send targeted emails with exclusive offers based on individual interests. Think Spotify’s extensive user account customization designed to keep listeners engaged with the platform and consuming content, or clothing retailer Very’s ability to make relevant recommendations based on local weather patterns.

All respond to the consumer’s desire to feel special, valued and understood. This next level ability to communicate is delivered by hyper personalization. Rather than focusing on segments or groups, it concentrates on the individual. We also know it as one-to-one marketing, of course. It uses big data, artificial intelligence, and data analytics including customer scoring, in real time to deliver products, content, and experiences tailored to each customer’s unique needs, preferences, and context. Going beyond simple facts like a customer’s name, geographic location, demographic data, and search and purchase history, it accesses more advanced and complex information. This can include a customer’s purchasing behaviour, browsing activity, response rates to notifications and times when they are active. Artificial intelligence analyses the data and creates insights that help businesses deliver highly customized campaigns. It increases the likelihood that communications contain optimal content as well as enhances customer satisfaction.

There are at least five reasons for brands to make hyper personalization a part of their marketing strategy:

  • Increased revenue –  An Accenture Interactive report found that 91 per cent of consumers are more likely to shop with brands that recognize, remember, and provide them with relevant offers and recommendations. Offering a hyper personalized experience demonstrates that customers matter. As a result, they are more likely to make purchases and become repeat customers. For example, in the insurance industry the first sale is often made at a loss to act as a “door opener” that leads to selling more insurance. This makes for a complex customer relationship that’s by definition “sticky”. This principle applies also to B2B marketing, especially with follow up sales.
  • Better customer experience – An accurate understanding of a customer eliminates irrelevant interactions, thereby ensuring time and effort efficiency for communications. It increases engagement and helps deliver information that is interesting, valuable, and memorable. Research by Boston Consulting Group discovered that customers who experienced a high level of personalization provided customer loyalty scores 20 per cent higher than those who experienced a low level of personalization.
  • Reduced customer churn – Winning customers is a lot more expensive than retaining them. Hyper personalization is a proven way to maintain brand interest. It is even expected – a McKinsey report found 71 per cent of consumers want companies to deliver personalized interactions. And 76 per cent get frustrated when this doesn’t happen.
  • Boosts marketing ROI – Marketing is a huge business cost if not implemented effectively. Return on investment is shaped by three metrics: conversion rate, average order value, and customer acquisition costs. Hyper personalization delivering accurate and relevant targeting of products and messaging increases the first two and lowers the last one. In fact, Econsultancy reported 80 per cent of companies experienced an uplift following the implementation of personalization.
  • Dynamic targeting – Hyper personalization is dynamic. Data is updated – unlike traditional personalization where, once the information is collected, it is not checked. It reflects changing customer needs, preferences, and behaviours such as life milestones and new interests.

Brands can enjoy all of these with creative digital print that delivers highly customized content and offers that drive action. Highly impactful, meaningful, and measurable communications can be created that ensure your clients’ customers feel understood and valued as well as keep them connected and encourage long-term loyalty.

Erwin Busselot is director Business Innovation & Solutions, Ricoh Graphic Communications, Ricoh Europe.

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