Traditionally, consumer packaged goods (CPG) companies relied on channel partners for customer information. In addition, businesses needed third-party cookies to track users’ activities to offer more targeted and personalized ads. But today, marketers face challenges from privacy policies like the General Data Protection Regulation and California Consumer Privacy and the absence of all third-party cookie data. Understanding the user persona and enhancing their experience has become a challenge now impacting revenue.
80% of B2C consumers reported that the experience with a company is just as important as the product or service. And the percentage grows to 85% for B2B. Hyper-personalization drives brand experience and repeat sales to brand loyalty by tailoring offers to match what the customer wants. In this new environment, businesses should improve the consumer experience and expand their marketing strategies to be more digital, targeted, precise and personalized to build that coveted brand loyalty. Fortunately, with the advent of direct-to-consumer (D2C), businesses now have direct access to data for better marketing, new product launch decisions and a consistent experience across all touchpoints. Each interaction with the company results in experiences that feel more personalized. But capturing, analyzing and protecting the data can be a challenge.
Hyper-personalization: Why and How?
Consumers lose trust in brands that fail to engage in a personalized manner. Hyper-personalization, using data subjected to AI and ML tools, drives brand experience and repeat sales by building brand loyalty. Personalization fosters a sense of consumer ownership and emotional sentiments that transform customers from shoppers to brand advocates.
Hyper-personalization can tailor marketing offers to what each customer wants via geolocation marketing, Smart segmentation and Smart referral that uses AI-driven algorithms to influence consumer behavior. Similarly, QR codes allow consumers to access information on demand and leave real-time reviews. All these interactions result in valuable data insights that provide end-to-end customer visibility to create hyper-personalized experiences.
In addition, the accelerating pace of information on social media and revolutionary technologies (AI/ML) change how people interact and provide companies with insightful information. This wealth of data generation facilitates hyper-personalization. It allows companies to tailor products, services and experiences according to consumer preferences.
Businesses should invest in a robust database to manage all of this data. Enhanced data management provides a long-term solution for driving transactions. Data translation into customer buying behavior requires a thorough and deep understanding of how consumers use and access different marketing channels. Brands can improve the customer’s buying experience with the help of Augmented and Virtual reality tools, in-store and on mobile, to leverage the enormous data gathered for product recommendations from any user.
A Consumer Data Platform (CDP)
A Consumer data platform (CDP) will be the guiding light for driving hyper-personalized customer engagement using a customer-centric, analytics-driven approach. CDP is a digital software solution that combines data from multiple touchpoints to create a central database. The solution consolidates inputs to form a unique unified customer profile – starting the process of hyper-personalized communication using the right channel at the right time. It will shift the approach from generic customer segmentation and mass marketing campaigns to personalized communication and customized experiences that address pain points and eliminate the problem of choice overload.
Customer analytics has four major data components: collection, sorting, storage and analysis. All four are fed into the CDP, resulting in a powerful platform for customer analytics.