The psychology of personalization | Turtl
Marketing automation has brought about valuable opportunities to personalise the customer experience at scale. Explore why it's effective and how to get it
Why it works, and how to not mess it up
Finding the human within automation
The plumbers and the persuaders
Customer data has become king, queen and country in the drive to win business and prove ROI. But are we seeing the wood for the trees?
Customer experience is a crucial challenge for the 21st-century enterprise and an accretion of responsibility within the role of the CMO.
A recent survey by Econsultancy saw 45% of marketers identify content and experience management as a top priority for their organization.
The marketing organization must now deliver increasingly personalized experiences across customer touchpoints to better engage prospective customers and encourage loyalty.
Intimacy at scale
The personalization of communications and product offerings is not a new way of building customer loyalty – it happens naturally in small-scale local businesses, where vendors know their customers intimately and interact with them accordingly.
At scale, this intimacy is lost, and with it the tendency towards loyalty. Businesses have long used audience segmentation to achieve greater relevance and connect with prospects and customers. Today, a wave of new technologies – in particular, automation – has created the opportunity for marketers to personalize their communications through the intelligent use of customer data.
Great plumbing + great persuasion
= great results
Doug Kessler, Creative Director & Co-founder of Velocity
Data is key to experience management, and marketers are hungry for it. The more data, the better the automation, the more efficient the marketing machine and demonstrable the impact.
Finding the human
At the 2018 Martech Festival, leading martech consultant, Scott Brinker spoke of the risks involved in blindly pursuing automation to the extreme – as beneficial as it may seem to the business: “We need to find the humanity within automation, put some checks and balances into this.”
Efficient for the company vs efficient for the customer
Doug Kessler creative director and co-founder at Velocity later picked up this mantle. He voiced the need to balance the data-happy “plumbers” of marketing – who focus on the pipes and joints of demand gen and live by the rule of data – with the “persuaders”; the creatives focused on the substance channeled through those pipes.
The sweet spot
Personalization only works when your martech is married with purpose-driven, relevant and persuasive messaging suited to the context and individual at the receiving end. Tact, finesse, and empathy are critical, and they’re not entirely known as the forte of plumbers.
Even when you are marketing to your entire audience or customer base, you are still simply speaking to a single human at any given time
Ann Handley, Head of Content at MarketingProfs
Before we rush to launch our automated campaigns, we need to think back to what makes the local shop environment so compelling. It’s not that the shopkeeper knows our name, but that they make an effort to ask about that special dinner we were making last time we were in to buy eggs. Or whether little Eva liked that new cereal and what to try next if not.
We need to remember that every single provider of customer data has a face, a mind and a context of their own, and we all crave acknowledgement of that. We all need to feel like more than just a number. Addressing that need is where personalized marketing can hit the sweet spot.
Do you personalize your communications based on customer data and behavior tracking?
- Yes, we track and react to individual behavior
- Only the basics, such as name and birthday
- No, but we're looking to in the next 12 months
- No, and have no plans to
A brief history of personalization
Customer centricity is nothing new
A brief history of personalization
With businesses across the globe doubling down on personalizing the customer experience, have we gone full circle?
In the late 18th century, shopkeepers were treated with a particular breed of disdain. Being related to one was considered embarrassing to those outside of trade. Unwilling to enter shops, customers would remain in their carriages while shopkeepers brought a selection of products to them to browse. The better a shopkeeper curated the selection, the more likely they were to make a meaty sale.
As Victorian society evolved, so too did the social status of shopkeepers, and it didn’t take long for the activity of shopping to become a pastime for the affluent, rather than just a menial task for servants. When stores became larger, the relationships between shopkeepers and customers began to grow less personal and more anonymous.
As tradespeople expanded beyond serving just their local communities, business owners moved from keeping note of who engaged with their business to how many did so, when they did and what they bought. Qualitative relationships became quantitative and collecting customer data became an essential tool for understanding how to grow the business further.
Curation is still key. Source: Deloitte
Then and now
Fast forward to the dawn of the internet, which thoroughly compounded the data trend, and here we are. Rather than knowing our individual customers, we segment them into groups of common traits or invent portraits of fake people to represent certain types of real ones. We then tailor our communications accordingly. 20% get one message, 40% another, 40% a third.
Today, marketers look at the success experienced by the likes of Amazon through digital personalization. They attend conference after conference where leaders tout the importance of customer experience and the gains to be made through investing in personalisation, which centers around how to automatically deliver the right curation of content to individuals to browse from the comfort of their sofas or desks based.
A thought experiment
Picture a small village shop run by a cheerful shopkeeper; let’s call her Gladys. Gladys knows the names of each and every person in her village. She knows what they like to eat for breakfast. She knows all the children’s birthdays. She knows everyone’s favorite comfort food.
This knowledge informs every interaction Gladys has with her customers. She knows to keep oat milk in stock for Jim, rather than almond. She knows the kind of chocolate treat to sneak into Ally’s shopping bag if she’s had a rotten day. She knows to ask about Geoff’s hip replacement and to tease Alice about her crush on the postman.
Loyalty to Gladys comes naturally to people in her community. She makes everyone feel valued and caters beautifully to their individual needs and personality.
Picture Gladys. Is she a warm-hearted person? A soft person? Perhaps the idea of her and her shop leaves you with a faint wisp of nostalgia.
What if you were to discover that Gladys was, in fact, a machine.
Everything Gladys does can be replicated by a sophisticated piece of AI. But would it feel the same?
The psychology of positive engagement
Rule #1: Don't be creepy
When personalization works and why
Data-driven communication sequences and personalized experiences can delight a customer, or alienate them
Who hasn’t heard about a time when someone has had an off- or online conversation about a random product, only to then start seeing said product pop up in targeted ads everywhere online?
Creepy is the word typically used to describe these experiences, and it’s a classic example of personalization going too far. Brands fall into this trap when they become too focused on personalization for their benefit, rather than for the benefit of the customer.
Marketers need to remember when clicking the send button on their personalized campaigns that behind the data they’re using are living breathing humans, with emotions, opinions, and voices. We need to consider the context in which our messages and tactics are experienced.
[Click to expand] Source: Interactions LCC
For the benefit of audiences
Effective personalization offers audiences at least one of two things:
- A sense of personal importance and value
- The removal of friction in the achievement of a goal
These two features neatly tie into what we humans psychologically want and need from our experiences and relationships – including those we have with brands and businesses.
Content that relates to our sense of self and how we experience the world stimulates our sense of belonging
According to self-determination theory, human beings have three underlying psychological needs that are important to their wellbeing.
A sense of belonging
The first is relatedness. We’re social animals and crave to feel significant to and understood by others. Our interpersonal relationships are strengthened by a sense of common ground – of shared understanding.
Content that relates to our sense of self and how we experience the world stimulates our sense of belonging. It's positively received, so long as it's perceived as authentic.
EasyJet’s 20th birthday personalized content campaign is an example of getting this right. They used 28 points of customer data to create personalized stories about each person’s travels with the airline – their shared journey over the years. Customers loved it.
Freedom to choose
Our second psychological need is autonomy. We want to feel like our opinions and emotions matter – that we have the freedom to act according to our minds, rather than the minds of others. Personalization that appears manipulative, stalkerish or insensitive jars with this need and quickly lands a brand in the creepy category.
Mastery of tasks
The third psychological need is competence. This is where removing friction comes in. We want and need to feel both challenged and accomplished, which is why most of us continually set ourselves goals.
Personalized marketing or communications that help a customer achieve a particular goal tap into this need. If a COO downloads a report about anti-bribery and we later send them our practical guide to establishing a culture of compliance, chances are we’ll get their attention. If we send them our report about AI ethics, maybe less so.
In B2B, when it comes to approaching personalization from the perspective of benefit to the audience, rather than business, then removing specific sources of friction and nurturing competence in a way that’s meaningful to the individual is a clear winner.
On the personalization bandwagon
What does all this mean for marketers?
The state of personalization in marketing
There's a way to go before sophisticated personalization is part of the average marketing strategy, but getting started with the right mindset is a distinct advantage
Personalization is a hot topic, but still out of reach for many marketers. According to research by Salesforce, top-performing marketing teams are 7.2x more likely to use web personalization extensively than underperformers and 4.2x more likely to leverage predictive intelligence to personalize emails.
Think beyond the mechanics of personalization, to the human on the other side
A report by One Spot revealed that over half of marketers are not using personalized product recommendations in their emails, while 78% only use first name personalization to customize emails – an approach that 92% of consumers in a survey by Pure360 said they are unlikely to engage with.
Many marketers need to put their data and content in order before they are ready to prioritise personalisation. Source: Econsultancy
A significant number of us need to put our audience data and content in order before we can fully embrace this level of personalization in our marketing strategy. Once that’s achieved, the benefits of successful personalization are undeniable and extend beyond marketing alone.
According to Salesforce, almost 60% of consumers are willing to share personal data in exchange for personalized offers or discounts, while 62% expect companies to send personalized offers or discounts based on their purchase history. Research by Deloitte shows that over a third of us are interested in purchasing personalized products or services.
With customer expectations shifting and tech stacks evolving, both B2B and B2C businesses will be adopting personalization as part of their strategies sooner rather than later.
How mature is your customer experience strategy?
When that time comes, remember to think beyond the mechanics of personalization, to the human on the other side. Consider establishing set criteria which any proposed personalized campaign needs to meet to qualify for execution. Here the human comes in, to temper automation.
Consider the context of the data you’re using to target them – what job are they (or have they been) looking to accomplish? This can be practical and educational, such as identifying the best corporate bank account to use, or emotional, like cheering themselves up.
Are you giving them something of value in that context – something that will make them feel understood, valued or empowered?
Finally, how would you feel if you were at the receiving end? Empathy is the hallmark of a great 21st-century marketer.