The pitfalls of personalisation

Hyper-personalisation is often considered the ‘holy grail’ of consumer experiences. It’s convenient, it’s targeted and in an ideal world it’s exactly what the consumer needs. But three quarters of consumers find at least some personalised marketing “somewhat creepy”.

I don’t know about you, but when my team and I are crafting a customer experience, the last thing I want my customer to feel is as if someone is spying on them.

Of course, not all personalisation is bad. In fact, a lack of personalisation is often just as problematic for customer experience – whether it’s not acknowledging order history, preferences, past complaints or questions, or simply the right information or services being too hard to find.

A study from January this year found that effective personalised content helps increase conversion rates by a factor of four. Another 2018 survey found that personalised calls to action increased website conversion rates by a massive 202%. This maps to the improvements I have seen in my own real-world experiences building customer journeys — a focus on content and message personalisation improves customer engagement rates and leads to better overall conversion.

On both sides of the Atlantic, attitudes towards data, privacy and personalisation are shifting. In the US, 57% of consumers say they’re now more concerned about data and privacy than they were a year ago. And 68% would like to see the US adopt a strict data-privacy law, similar to Europe’s General Data Protection Regulation (GDPR). In Europe itself, research by the Open Data Institute found that as little as 2% of consumers trust advertisers with their personal data.

This shift in public perception has huge implications for brands. So how — in this changing environment — can brands do personalisation right, benefiting from increased relevance without alienating increasingly sensitive consumers?

Back to basics

No ones like to feel watched — do too much over-personalisation and you risk unnerving, annoying or angering your target consumer. Not only can the perception that brands are overreaching in their use of personal or browsing data hurt the short-term conversion goal, it can also harm the long-term relationship with that consumer, meaning lower customer lifetime value (CLV).

Happily, there are ways — well-grounded in best practice — to avoid these pitfalls of personalisation. The solution to this problem is actually one of the core principles of the GDPR — purpose limitation. This means that data should be collected for a specified purpose, which is made clear to the customer at the time of collection. And when that purpose is fulfilled, the data-controller should delete whatever data has been gathered and is no longer needed.

As consumers demand more and more transparency and control, it becomes increasingly important that they know the source of data used to personalise communications and promotions and that the data is clearly being used for the purpose given when it was gathered.

Taking the GDPR’s ‘purpose limitation’ will incentivise brands to plan their data gathering in a way that’s more sustainable and prioritises long-term customer value. If you need data for a legitimate purpose, ask for it in a way that makes it clear how the customer can expect to see it used.

For example, take cookies: they are there to enhance the customer experience and ensure you’re serving relevant information, whether that’s tailored product recommendations, personal shipping information or FAQs based on the customer’s browsing history. Communicate these benefits to the customer, when you ask him or her to opt in to cookie placement. And make it clear that they are still in control (“You can change your settings at any time”).

Know your customer

In the age of increasing scepticism about data gathering, there is only one way for brands to personalise successfully: they must know their customer. This makes it imperative that brands build a customer experience that is built around consent, transparency and data intelligence.

To gather the data they need to personalise effectively, brands must collect at every touchpoint, they must be transparent about what they’re doing and consumers must be able to see a clear relevance and benefit.

With touchpoints now spanning a range of digital and analogue channels and many different devices, generating gigabytes of data every day, AI-driven customer-experience automation and optimisation has never been more important. It’s simply not humanly possible to collect, store and understand the amount of data generated today without technology to automate and optimize the process.

Finally, giving customers the choice of channel, and how they want you to engage with them, can be hugely powerful. Let customers know you want to give them the best experience and give them options about what they want to see.

Give the customer choice and control

To prosper in an age of personalisation, brands need to deliver a customer experience that is built upon transparency, choice and control. Consumers must feel at every point that they have a choice about what data they share and how the brand communicates with them.

And in every personalised communication, there must be a benefit that’s evident to the recipient. In this way, brands can benefit from the precision personalisation offers while also building customer relationships based on empathy, relevance and trust.

 

By Jeff Titterton, Chief Marketing Officer, Zendesk.


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