A 2021 Mckinsey & Company report found that 78% of consumers are more likely to make repeat purchases from brands that personalize. Almost 80% are also more likely to refer their family and friends to these companies.
As we know, personalization is the name of the game in customer experience today. In this post, we’ll dive into the key personalization trends you should be aware of in 2022.
The demand for customization is increasing.
According to Twilio’s 2022 State of Personalization Report, 62% of consumers say a brand will lose their loyalty if it delivers a non-personalized experience, up nearly 20% from 2021.
Another Zendesk report suggests that customer experience is more important to consumers now than ever before.
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This increased need for personalization not only started recently, but grew in part due to the pandemic of 2020. It was a time of uncertainty that forced most consumers indoors and online for a extended period of time.
The Mckinsey & Company report reported that 75% of consumers tested new purchasing behavior during the pandemic. Consumers are looking for more valuable experiences from the brands they engage with.
In fact, the same study revealed that more than 70% of consumers now expect personalization and are frustrated when they don’t find it, making personalization a must for today’s brands.
Online personalization is prioritized.
According to a 2021 Zendesk report, 65% of customers want to buy from companies that offer fast and easy online transactions.
The report also found that online businesses are outperforming, with e-commerce brands leading the way in consumer engagement.
Here’s why: Online offers many more opportunities for personalization than in person. You can target users to see your ad and follow them along their journey as they discover your products and consider purchases.
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In person, customers often see generic displays followed by generic store experiences. Meanwhile, brands can’t collect any data about items that customers have viewed and considered, unless there’s a purchase.
With these obstacles in place, many brands find it easier to personalize their online marketing efforts.
Omnichannel is the main way to go.
Only 35% of businesses believe they are successfully achieving omnichannel personalization, up 13% from 2021, according to Twilio’s 2022 State of Personalization report.
With consumers actively engaged across multiple channels, effective personalization depends on an omnichannel approach that meets consumers where they are, not where brands expect them to be.
When it comes to personalized marketing, this is pretty bad.
— Cole Cook (@cwcook22) June 24, 2022
A 2021 report from Vonage revealed that 26% of consumers are very likely to stop buying from a company if they cannot switch between communication channels.
However, McKinsey & Company points out some obstacles to a perfect omnichannel strategy. Here are the two main ones:
- Traditionally, digital and customer-facing channels operate independently, so change requires the link between software and hardware.
- It involves changing the customer journey flow, which involves retraining staff and updating the process.
While these are not minor challenges, they can be tackled with the right equipment and resources.
Companies will prioritize proprietary data as privacy concerns rise.
With the end of third-party cookies and recent data privacy laws, brands have had to change their approach to collecting data. This change has caused a domino effect, affecting personalization strategies.
According to Twilio’s 2022 State of Personalization Report, 37% of brands use proprietary data exclusively to personalize customer experiences, an increase of six percentage points compared to 2021.
Because? The first reason is higher quality data, according to 54% of respondents. The report shows that accurate data is a particular challenge for brands, preventing them from fully implementing personalization strategies.
Other reasons include better privacy and easier management.
First-party data collection enables businesses to make better decisions faster and integrate their systems more easily for a seamless experience for both sellers and consumers.
Key tips on personalization
- Personalization is not personalization. Personalization is explicit, while personalization is implicit.
- You can achieve intent-based personalization by understanding what people interact with on your site.
- Never forget that no matter how much technology changes, the key to great marketing is having a deep understanding of your users.
- The future of marketing is in making websites, products or personal experiences deeply meaningful.
- Personalizing your search results gives you the opportunity to increase your visibility for truly relevant searches.
- The potential to contextually engage customers based on a need and serve that in real time will drive mobile devices as they become payment vehicles.
- Personalization has gone beyond segmentation to algorithm-based content.
- Personalization is about leveraging what you can from people when they reach your touchpoints with your inbound customers.
- Don’t think about the different groups you want to market to. Think about the power of one and how to reach that person in the most personalized and creative way.
- The three-step approach to personalization is: listen, educate, and engage.
- Think in terms of customer-centric recommendation engines rather than company-centric sales engines.
- Personalization is about creating a natural conversation between businesses and customers.
- The three keys to balancing personalization and privacy are company transparency, consumer choice, and accountability.
- With personalized ads, the goal is to reach the highest point of relevance with the least sense of intrusion.
- Instead of thinking of data privacy as a limitation, consider that what needs to work could be the value proposition.
- Marketers can focus too much on the details and forget to focus on the most important aspect: relevance.
- Personalized marketing isn’t just for customers and prospects, it can affect change within an organization.
- We’ve gone from opt-in, permission-based, custom-made address fields to relevant online conversations that engage and engage.
Editor’s note: This post was originally published in December 2021 and has been updated for comprehensiveness.