For retail marketers, one of the most potent techniques to drive revenue and win market share is personalization. A recent Boston Consulting Group study found that brands that create personalized experiences are seeing revenue increases of 6% to 10%, and McKinsey found that “targeted communications that are relevant and useful can create lasting customer loyalty and drive revenue growth of 10 to 30 percent.” While personalization promises tremendous benefits, there’s also a price to pay if marketers get it wrong.
New Survey Quantifies the Price of Personalization Failure
A newly released survey by Accenture finds that a lack of trust and poor personalization could be costing U.S. businesses as much as $756 billion in lost revenue every year. This is a shockingly high number and reinforces the must-do-can’t-miss nature of personalization.
Some important data points from the survey, which was conducted with 25,000 global consumers, 2,000 of which were in the US:
41% of US consumers said they stopped patronizing a company because of “poor personalization and lack of trust,”
31% report finding great value in services that automatically learn about their needs to personalize recommendations, and
66% want companies to earn their trust by being more transparent about how their information is being used.
This survey has some vital implications for marketers.
The Implications for Marketers
The survey data tells us that relevance and trust are two sides of the same coin when it comes to personalization. Marketers earn trust by making good use of the data that is being shared with them. And consumers are more willing to share data with brands as long as marketers use this data to craft relevant, accurate, and targeted experiences for them.
If you’re a marketer, a good litmus test is to see if and how you answer the following questions:
Do you know more than the names of your best customers?
Do you have systems that are remarketing products that the customer has already bought?
Can you associate specific stores or channels with your best customers?
Do you have the insights you need to anticipate the needs of your customers?
Do you understand customer preferences about their favored interaction channels?
Can you segment your customer base to identify the sweet spot for offers?
Satisfactory answers to all these questions have their roots in customer data. In short, effective personalization is directly linked to a deep understanding of the consumer. And this understanding is built on the back of unified customer data.
The Hurdles that Stand in the Way
While most omni-channel brands possess the customer data that they need to power personalized experiences, this data is fragmented, out of reach, and impossible to activate. These data limitations mean that marketers often have a limited understanding of their customers, which holds them back from building experiences that drive top-line revenue. Our recent blog post looks into why customer data unification is a prerequisite for effective personalization.
An Intelligent Customer Data platform provides marketers with high quality reach, faster time to value, and unparalleled flexibility in driving top line growth.
Could an Intelligent CDP help transform your marketing efforts? We invite you to reach out so we can start the conversation.