Connecting with customers has become much more complex than sending emails or text messages en masse. Today, creating meaningful connections with customers has taken precedence. This is not only a strategic business move but one that fosters great relationships with customers for much more than financial gains. Certainly, connecting with customers involves a lot of written and verbal exchanges, but any business can do that. The question is, how will you set yourself apart as a business in this era of digital transformation?
In the words of Milton Friedman, an American economist, “Only a crisis, whether real or perceived, can produce real change”. The pandemic has plagued almost every business sector in one way or another - the sheer uncertainties of this time had businesses scrambling to find ways to re-establish connections with customers but in a genuine and empathetic way. The shared resolve for many industries on this challenge came down to finding better ways to communicate with customers digitally but primarily on a one-to-one basis.
Customer experience, as we once knew it, took on a new meaning. Due to public health regulations, face-to-face interactions diminished. The pandemic demonstrated that customers and businesses could interact with one another digitally in their homes by way of smartphones or computers. Fundamentally, this crisis triggered an inflection point that has accelerated the digitalization of customer-business relationships.
What happened to CX?
The number of business services available to customers without requiring them to leave their house is increasing every day. And for that reason, customers are rewarding businesses that not only offer these digital services, but also provide the best experiences by engaging authentically with them like they would during an in-person session.
Previously, and very recently in fact, marketing efforts were tailored to a group of customers sharing similar traits by what was known as ‘personalization’ - which basically meant creating segmented groups of customers based on shared traits. Many companies still practice this, grouping customers on attributes such as age, location, gender, occupation, ethnicity and so on. However, this method of ‘personalization’ is no longer driving huge results as it once did. The biggest challenge is that the attributes used to create these segmented groups were too broad to develop well targeted campaigns that would be valuable for everyone in the group. People can have very unique needs even when they share a similar demographic background with many others.
Consumers expect businesses not just to meet their needs but also exceed them. To meet this demand, brands began using data, with the combination of analytics and technology to provide an even more customized customer experience - hyper-personalization.
What is hyper-personalization and how does it work?
Hyper-personalization entails enhancing the experience of customers by using real-time data to offer them products and services that match their current and future needs. The insights are generated through data and analytics derived from artificial intelligence.
But how much more effective is hyper-personalized marketing?
Customers expect to be treated as an individual. They prefer to deal with companies who connect with them on a personal level and can meet their ever-changing needs.
Hyper-personalization is one of the most authentic ways to connect with customers because it takes into account granular details on each person. It also comes with the advantage of being a cost-effective marketing initiative. Businesses can offer well-targeted products to consumers at the right time to gain higher conversion rates.
Here are a few more reasons to adopt hyper-personalization backed by data;
- Hyper-personalization can boost sales by 10% or more and deliver a significant return on investment.
- Approximately 22% of customers are willing to share their personal data in exchange for a more personalized service or product.
- 90% of customers find personalized advertising appealing.
- Approximately 80% of customers will be more inclined to purchase from a company offering personalized service.
- 69% of online consumers say that the relevancy of a company’s message influences their perception of its products and services.
Looking at the stats above, it is clear that implementing a hyper-personalized marketing strategy powered by data and technology provides businesses the insights required to adapt to customer’s needs in real-time, ultimately leading to more authentic, empathetic, and meaningful interactions.
So how can a business use data, analytics, and technology to offer a hyper-personalized customer experience?
Previously, customer data was collected using outdated and discontinued systems whose usability was limited to call centers and point-of-sale systems. However, thanks to the advancement in digital technology, many organizations can make use of their own proprietary data, along with information derived from a customer's digital footprints. Information derived from this can be used to create detailed profiles of customers to understand their preferences and behaviors. If a business truly wants to deliver a hyper-personalized experience to its customers, they must begin to make use of available data and technology to catch up to their needs before losing them to competitors.
The concept of hyper-personalization can be applied throughout the customer journey, from attracting customers to providing them with customized services, making a purchase decision easier. Customer data gathered throughout a customer journey can be combined with external data to predict what customers want before losing them to competitors.
Hyper-personalization aims to simplify decision making for customers when presented with valuable offers. With more connected devices and large data, organizations are finding unique ways of collecting data and connecting with customers in a meaningful way.
There are various tools that enable this level of customer data to be efficiently used. For example, a CRM platform like Salesforce is able to gather customer data to be analyzed. This data can then be integrated with a third-party communication solution to deliver personalized one on one interactions to customers. Statflo offers the technology, an API texting solution, which can be fully integrated into Salesforce and deliver these personalized offerings and communications directly into a customers smartphone via SMS.
What does hyper-personalization look like for different sectors?
Hyper-personalization in the banking and financial services industry
When compared to the e-commerce industry, it is evident that the banking sector is lagging behind on taking advantage of hyper-personalization. This Deloitte report ‘ The Future of Retail Banking: The hyper-personalization Imperative’ suggests that offering customers personalized products and services is a crucial component to driving customer-centricity across the value chain for financial institutions. It is critical in order to meet customers’ current and latent needs.
Also, competition is at an all time high for the banking sector due to the influx of tech-savvy disruptors flooding into the market. As much as hyper-personalization revolves around the needs of a customer, it is also key to the survival of retail banks.
The goal for hyper-personalized marketing for banks shouldn’t always be about selling, it's also about providing services, valuable information, and actionable financial advice to customers as much as possible. This makes it necessary to communicate with customers once or multiple times a day depending on their needs.
A brilliant demonstration of this is the recent partnering of Kasasa, a financial organization and Statflo. Gabe Krajicek, CEO of Kasasa said, “Our partnership with Statflo is just one way that Kasasa is helping community financial institutions leverage new technologies to deliver on their unique ability to provide exceptional customer service to their account holders.”
He goes on to say, “It is more essential than ever for financial institutions to connect with their customers at the right time, with the right message, on the right channel. The integration of text messaging into Kasasa’s powerful marketing platform, ConnectTM, creates an enormous opportunity for community financial institutions to elevate their overall customer experience.”
Hyper-personalization in the telecom industry
The telecom industry is oligopolistic in nature with larger service providers buying out the smaller ones to gain a competitive advantage in the industry. But while many carriers have found success in the market by doing that, there is a high rate of customer churn. For example, customers will quickly switch over to another carrier that offers a valuable service for much lower prices.
With few major players in the market, telcos didn't put much thought into offering customers personalized campaigns. However, over the last decade these organizations started to make efforts to boost customer experience and reduce customer churn. Paging Zone does an excellent job at this by employing a customer outreach strategy that leverages data and analytics to reach and keep potential customers and win back customers they've lost.
Larry Zekhtser, Manager at Paging Zone, talked about how his team successfully rolled out Statflo at their stores and started reaping benefits of a personalized customer outreach program from day one. Larry’s team connected with customers in a meaningful way over text messages. This was a breakthrough moment for Paging Zone, specifically in the light of the pandemic when there was so much uncertainty surrounding the store closures, implementation of safety protocols, and other in-store shopping arrangements.
Final thoughts
Marketing and technology should no longer be separated. A brand's ability to establish meaningful connections with customers has always been the foundation of marketing. Therefore, the combination of data, analytics, and technology has become an integral part of any marketing strategy for meaningful interactions with customers which ultimately, increases the bottom line. Hyper-personalization won't be going away anytime soon.
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