Delivering on the Personalization Imperative: How Retail Marketing Leaders are Facing the Challenge Head-on

If you’re sick of hearing about how important it is to personalize marketing emails, ads, onsite experiences and so on, you’re not alone. We know if you could personalize every touchpoint, you would. The problem is, it’s really hard to get that personalization right consistently and at scale.

We can’t solve this problem overnight, but it starts with getting the right people in the room to tackle the “why” — so we did just that at a virtual roundtable earlier this month with senior-level marketers from retailers like JTV, Rite Aid, Hammacher Schlemmer, Gap, Bulgari, Bass Pro, Natural Life, Ulta and City Furniture. Here’s a look at what we discussed.

How to Personalize Isn’t Just a Technology Question, It Also Requires a Mindset Shift

Achieving true 1:1 personalization consistently across channels and on a large scale requires the right technology, specifically an AI-driven retail marketing platform. But delivering on this goal involves a lot more than having the right solution in place.

You also need to pair that technology with the right strategy and gain buy-in across the board, which can prove challenging in its own right. That’s because AI-driven 1:1 personalization requires you to trust the system and let data guide your approach. This might lead to outreach that looks “untraditional,” particularly to those within your organization, and requires a mindset shift as a result.

Consider the following changes an AI-driven approach might bring to your marketing program:

Expanded Product Recommendations

The Good: AI can make personalized product recommendations based on behavior signals that are highly unique for each individual. This might stray from the typical pattern of “Shopper A bought jeans, so let’s show her more jeans and some matching tops” in order to deliver more relevant recommendations for everyone and surface more products from your catalog for expanded discovery opportunities.

The Uncomfortable: On the surface, these expanded product recommendations may not always make sense to everyone — but they should to the individual receiving them. For instance, this approach might lead to recommending products that don’t necessarily pair together, like surfacing men’s clothing and women’s clothing in the same marketing outreach. But if the shopper receiving that communication browsed in both sections, then it absolutely does make sense and can even work to increase brand loyalty by encouraging cross-category shopping.

Frequency of Communications

The Good: AI can also determine the right types and frequency of communications across channels for individuals based on each customer’s behaviors and interactions with your brand. In doing so, it can help your team reach shoppers with more timely messages based on their needs at any point in time and even do so in the channels where they’re most likely to convert — all in an effort to promote engagement and grow revenue.

The Uncomfortable: Your internal team might start to feel overwhelmed with marketing messages from your brand, but it’s important to remember they don’t represent your average customer; they are likely on your site all the time and therefore will receive more communications as a result. However, retailers who have already embraced this approach have seen the benefits of doing so. For example, one retailer recently switched from sending a maximum of three emails per week to letting AI guide email frequency. With this change, their customers now receive as many as 7-9 emails per week, but all of those communications are personalized based on customer behaviors, which has led to notable increases in open, click and conversion rates alongside significant list growth.

What About Personalization Centers? They Actually Inhibit Personalization

What if the idea of fully trusting the data still makes your team nervous? If personalization is all about delivering the experience individual customers want to see, why not just ask them what they want? In theory, this makes sense, but in practice, the idea of personalization centers that allow shoppers to tell your marketing team what they want to hear about inhibits personalization. 

This was a big sticking point among the marketers with whom we spoke, whose experience has taught them that personalization centers limit long-term customer interactions in three ways:

Their Perception Becomes the Reality

Asking customers to tell you what they want to hear relies on their understanding of what your brand offers, which may differ from what your brand actually offers. And once customers select a box, you have very few opportunities to change that perception because you can’t communicate outside of that area.

Product Discovery Falls By the Wayside

Personalization centers also remove the element of discovery from the shopping experience. Let’s say a shopper indicates they are only interested in one category (e.g. women’s clothing), but you have a new category that might be of interest to them (e.g. women’s shoes). If they self-selected that they only want to hear from you about women’s clothing, then you can’t nurture them through the discovery process to introduce them to that new category. In other words, you lose the opportunity to show them products that they might have loved and not even realized.

You Can’t Appropriately React to Changing Needs

The best personalized experiences reflect what’s happening in shoppers’ lives, which will inevitably be different at various points in time. So if a shopper tells you they’re only interested in women’s clothing but then she has a baby, what happens? Even if she’s looking at baby clothing on your site, you’re painted into a corner because last year she told you she only wanted to hear from you about women’s clothing.

When It Comes to Personalization, the Rising Tide Lifts All Boats

Overall, the marketing leaders with whom we spoke agreed that when it comes to personalization, the rising tide lifts all boats. As they continue to move forward in advancing their personalization strategies, they’ve found that the more personalization they deliver, the better all their campaigns perform — even those that are less personalized.

Achieving the desired results from personalization requires the right technology, strategy and buy-in as described above, along with an understanding of the limitations of more traditional approaches like personalization centers.

Interested in learning more about what it takes to deliver personalized experiences that exceed the expectations of today’s shoppers and drive growth for your brand? Click here to watch our broadcast featuring Ascena Retail Group, Beyond Transactional Commerce: Driving Profitability in a Digitally-Dominant World.