An effective personalization of marketing messages and offers means more relevant communication and a higher sales conversion. A study by the Harvard Business Review published in 2015 put potential sales growth at 5% to 15%. So far, however, only a few companies have managed to carry out consistent personalization in their marketing and sales content. Only those who take the trouble to break customer groups down to microsegments and analyze their behavior in detail create the basis for powerful personalization. Subsequently, the organization must be radically aligned with this goal and IT systems have to be adapted until they support all defined measures.
Personalization is the dream of every marketeer
It is the dream of every marketing manager to imagine that every customer receives tailer-made marketing messages at the right time that lead him to further actions. Which pram manufacturer would not be delighted to present the pregnant woman a model in their desired colors, exactly matched on delivery date and delivery time. Or to offer the efficient male fashion shopper an overview of matching shoes tailored to the rest of the wardrobe.
As we have already stated in the article “Relevant customer dialogue is sooo hard” a few weeks ago, it is challenging to define marketing messages that matter. Nonetheless, the importance of marketing is growing as mature customers make most of their buying decisions independently of manufacturers and distributors prior to any initial sales contact by browsing the Internet or inquiring their personal network (see Blog article “Importance of B2B Marketing grows”).
Personalization understood and applied
Source: iq! Management Consulting
The behavior and the preferences of microsegments determine Personalization
Before thinking about the introduction of personalized measures, a detailed analysis of customer structure and behavior should be carried out. Only the company, which understands exactly the customer groups it serves, how they tick and in which situations they are open for personalized offers, will succeed with their strategy.
For true personalization approaches, it is not sufficient to simply form customer segments, such as Seniors, young mothers or teenagers. These must be further broken down. Criteria here are in particular the behavior of the individual microsegments. Once formed, it is equally important to determine where and when these micro-segments are most susceptible to personalized messages. Is it the time after leaving a company’s website? Or a message via a social media channel?
The structure of the message must also be precisely tailored to the preferences of the target customer, otherwise there will be no reaction. This can only be found out through intensive testing. For example, it is more effective for some customers to offer them an accessory or service for an already purchased product. Others respond better to a suitable secondary product.
Personalization requires radical implementation
For a successful implementation of personalized communication, it is not enough to just modify the instructions for the marketing department. Iq! recommends newly formed teams who are solely responsible for implementing the personalization strategy. Incentives must also be attuned to it. Processes need to be made more flexible and agile to efficiently transport the multitude of different marketing content. A long approval process makes no sense here.
Many companies already have strong IT systems that can support the personalization initiative. In most cases, the potential of these IT systems has to be raised and synchronized with other tools in order to be able to really support the new measures. And finally – as with almost all innovative topics in marketing and sales – the organizational structure should be adapted to the changed circumstances. This means e.g. previously separate units must now be merged. Or instruction powers are changed and simplified.
An effective personalization strategy can contribute to the success of a business. However, this requires intensive preparatory work in analysis and implementation. Only in this way does a personalized measure really encounters a customer who “jumps on” and considers it to be relevant.