Since customer-centric digital strategies are now the norm for successful brands, the current focus should be on ways to use new tools and tech to differentiate your brand experience from the competition.
This is not so different from how brick-and-mortar shops operate: Customers walk in and are immersed in specific branding techniques, marketing strategies, and options for connection and personalized interaction.
This is a tried-and-true formula for in-person shopping, so why shouldn’t it be translated to digital storefronts as well? Let’s look at some of the ways that brands can leverage emerging tech to create a powerful, profitable personalization experience.
There are endless statistics about how important it is for consumers to feel like they are getting an individualized experience. Salesforce found that 70% of consumers are far more loyal to brands that understand their needs, and 84% say that they’re more likely to shop with brands that make them feel like a person rather than a number. Additionally, 91% say they’d prefer to shop with brands that offer relevant, personal recommendations.
Harness the power of the dopamine effect
Data-driven personalization allows you to sell more and sell more often. Why? First, it allows you to anticipate what customers want and deliver it at just the right moment. Second, it helps you leverage what experts call “the dopamine effect.”
In the simplest terms, dopamine is a neurotransmitter that drives us toward pleasurable experiences (like shopping or eating rich foods). When we do these things, we get a chemical reward that connects the activity with a positive feeling.
Consider the extreme popularity of Walmart, Spotify, Netflix and Amazon. Part of the appeal is that they conveniently offer vast options, but that’s only part of the story. What these brands understand is that businesses need to create that rewarding dopamine hit that we all crave. That’s the hook that keeps us coming back.
They achieve this through personalization. You can create a unique account, answer quick and easy questions about your tastes, and immediately get exciting recommendations. They continue to refine your profile by learning your browsing habits and matching you to new things that pique your interest. You might not like every pick, but you get that jolt of excitement that comes with something new and interesting to you.
Harnessing the power of this “dopamine effect” is a skill that must be trained. Companies can no longer follow a generic “copy/paste” formula and expect consumers to care. Not only do brands need to personalize the content, but they also need to personalize marketing tactics like timing and communication frequency.
7 KPIs to help gauge personalization campaign success
To ensure that you’re getting the most from your personalization efforts, use data collection tools to measure and track relevant key performance indicators such as:
This data can be leveraged to show where your strategy is working and where it needs to be tweaked. It can be further broken down through microsegmentation for deeper analysis as well.
It’s time to add AI to your team
People want to be entertained when they come to you. Whether they’re looking for grocery delivery or a new workout, they expect to pay for more than a basic transaction.
The level of personalization needed to truly stand out from your competitors can only come from conversational AI and neuromarketing tools. Fortunately, these things are now accessible enough that just about any brand can incorporate them into their marketing and business strategy.
Your brand needs more microsegmentation
One example of this is the analytics software that Amazon offers. It provides contextual cognitive analytics that drastically shorten the time it takes for companies to parse collected data so that they can start implementing insights faster.
Access to real-time analysis allows for quicker, better and more accurate segmentation of your target market. In most cases, the right tools like these give businesses the ability to create microsegments that can be used to A/B test hyperpersonalized marketing strategies.
Customers are happy to provide more detailed information about themselves via chatbot or interactive interfaces if it leads to a better experience, too. Accenture found that 74% of shoppers would like having detailed “living profiles” with a company if it meant they got products, deals and experiences that were specifically tailored to their interests.
Harness the potential of gamification techniques
This willingness to provide more personal details can be combined with another incredibly effective personalization tool: gamification.
Adding certain game-like elements to your customers’ shopping experience can make a huge difference in essential KPIs like retention, loyalty and responsiveness, among others.
Gamification leverages the dopamine effect to make shopping with your brand feel even more rewarding. For example, simple popup badges that display progress toward a free shipping threshold are enough to make a customer feel like they are getting more than a basic “add to cart” experience. These “award” badges are enough to make nearly a quarter of online shoppers add extra items to their bags in order to reach the perceived reward of free shipping.
Starbucks makes excellent use of gamification tactics to create a sense of loyalty and community with its customers. They employ badges, but they also use cumulative feedback to keep people engaged even when they’ve completed their order.
In Starbucks’ case, cumulative feedback comes in the form of “achievement” bonuses, such as getting extra stars for using preferred payment methods or completing special challenges like ordering a featured seasonal drink three days in a row.
Other brands also offer tiered rewards systems that are based on things like being a store credit card holder or spending a certain amount throughout the year (e.g., Sephora’s Beauty Insider program).
Explore emotional intelligence technology
The Accenture survey also noted that consumers have never felt that online businesses ever got “too personal” with them, so it’s clear that more is better when it comes to delivering unique experiences.
In response to the knowledge that customers want their shopping experiences to be as individualized as possible, some companies are turning to a specific type of tool called emotional intelligence technology to get an even more personalized view of their consumers.
It’s often challenging for brands to know how their marketing messages will be perceived, especially in today’s digital-forward culture. In an effort to offset this, businesses are turning to sentiment analysis through technology like facial detection and machine learning. These AI algorithms analyze facial expressions and speech in photos and videos while also examining text posts on social media to interpret attitudes, values, emotions and opinions.
Of course, this technology isn’t foolproof, but it can help to paint a more detailed picture of your target market for better microsegmentation. For example, if Amazon sees that a customer often browses for eco-friendly cleaning products and has bought jeans recently, they could suggest a brand of jeans that uses recycled materials and offers similar styles to the ones purchased previously.
How personalization becomes profitable
It’s true that adding personalization technology comes with an upfront cost. However, 95% of companies that implement personalization have tripled ROIs and increased overall profitability after just one year of personalization efforts.
Another study found that brands that use advanced personalization techniques see a $20 return on every dollar spent.
Make a mundane shopping experience memorable
Personalizing the experience can happen in a variety of ways, too. For example, if we have a customer whose daughter loves a particular type of chocolate, we make sure to add that to his profile. When he is shopping, we include a shopping cart suggestion as a reminder in case he wants to purchase those chocolates again.
Another way Food Rocket personalizes is by geographic location. Our product assortments change depending on where customers live. We then add in information about preferences and purchase history to populate a specific list of grocery offers that appeals to each individual person.
Little touches like remembering a customer’s daughter likes a particular chocolate or another customer’s partner needs gluten-free options bring an extra level of connection to the shopping experience.
Understanding your demographic can also help you look for unique ways to personalize content. If your brand is focused on eco-friendly products or services, then you can tell the story of the products. By connecting your customers with the farmers and growers behind your product, you’re delivering an experience that’s important to them.
If your business targets a demographic that values information, then you can provide product snapshots and teach them how to interpret labels or review formulas. This shows that you understand the type of experience they value.
Create uniquely enticing ‘shop windows’
Personalized data insights also allow brands to curate better, more enticing “digital window displays.” There is a lot of time, effort and market research that goes into designing a brick-and-mortar storefront display. Companies leverage modern marketing psychology along with in-store analytics to determine which products to showcase and the most appealing ways to highlight them.
Digital shops can do the same but better. Instead of marketing to the shoppers most likely to purchase what’s in the window, you can use personalization technology to create a unique “digital shop window” that specifically appeals to the person logged in to your website.
Imagine the conversion rates that in-person stores would have if they could change their storefront displays to attract every passing customer! This is the level of success that this type of tech can provide to companies that understand how to take full advantage of it.
Don’t forget the allure of a deal
One easy way to heighten the dopamine effect in shoppers is to give them a deal. In order to be truly effective, customers need that extra emotional push of feeling like they’re getting a deal on top of their personalized experience.
It doesn’t have to be an overwhelming, deep discount, either. Often, adding a small additional percent off on targeted items or giving them extra loyalty points is enough to be enticing.
This extends to loyalty programs as well. When customers get to choose how and when they spend their rewards, it elevates the whole experience and makes them feel more excited to keep shopping. Credit card companies use this tactic frequently. Some offer category-specific points, such as flights or restaurants, but most offer a variety of options for turning reward points into something that each individual person feels is a treat.
For some, this might be an account credit. Others might exchange their points for gift cards or luxury hotel bookings. Offering personalized deals, both in-store and via loyalty programs, encourages repeat business by turning every aspect of shopping with you into a pleasurable, rewarding experience
Remember that your brand is more than a static storefront
Just because you’re not in a physical store making in-person connections doesn’t mean that you should give customers a less interactive experience. Remember that your digital shop is more than a utilitarian interface — it’s your portal of connection to every individual consumer.
There is no longer a question of whether or not you should offer personalized digital experiences. The research shows that anything less is a death knell to your brand’s long-term success. Customers have raised the bar when it comes to shopping expectations, and they won’t hesitate to leave you for a competitor that offers something more exciting. Fortunately, there are so many tools and techniques available to businesses of all sizes that personalization is possible without overhauling your entire business strategy.
Making an effort toward personalization will help you grow your digital presence and create a profitable, long-term business model.