Businesses have access to unprecedented levels of data — on this we can all agree. And in theory, the benefits of this data seem to be endless: helping organizations better understand customers, target them more accurately and even predict future behaviors.
But the reality is often different: despite knowing more about customers than ever before, marketers and merchandisers struggle to personalize effectively, resulting in less than personal experiences.
There are three reasons for this:
1. Limitations with Marketing Tools
The tools that marketers have at their disposal tend to fall into two broad types — segmentation and recommendations — neither of which deliver a truly personal experience. Segmentation is not personalization, because fundamentally it groups customers together. It’s important, and works well for a proportion of the customers treated in the segment.
Equally, using recommendations is not personalization because it relies on the past historical behavior of other customers to predict what to show next. This works well in lifting average order values and sales, but fails to deliver a personalized experience for the majority of its targets.
2. Types of Data Captured
Most segmentation is done using demographic indicators such as age, gender income, etc. In some cases, behavioral data is also used, such as previous purchase in a particular category. What’s missing for most marketers are contextual signals of intent — what the customer is interested in right now.
For example, if a customer is targeted with a printer cartridge replenishment offer, he may click through the email. But within two mouse clicks he is looking at new printers. Although he’s due to purchase a new printer cartridge based on his past behavior, the office supplies company doesn’t know that the printer has broken and he’s looking for a new one. What he’s looking at right now is critical because his context has changed.
This is an important reminder that past behavior is no guarantee that a customer will continue to behave as they did in the past. What’s needed here is the ability to react to real time context in the moment. This contextual data is rarely captured by marketers, but is arguably the most data valuable of all.
3. Customer Data is Scattered
According to Forbes Insights, companies use on average 36 different systems for capturing customer data. This gives marketers a huge problem: the data they need to effectively personalize is distributed across different internal and cloud systems. The old adage is true: you can’t personalize unless you know the person, and today marketers are woefully equipped to truly know what their customers are interested in, across channels, and in real time.
This is at the heart of the problem: data is the fuel that enables marketers to deliver compelling experiences, but until we fix the data problem the best that can be done is rudimentary segmentation and recommendations.
Because of this data problem, organizations are left struggling to coordinate and measure. They need to be able to market consistently across channels and understand when and where to engage with their customers. But with scattered data, they neither know their customer nor are they able to accurately assess engagement. The fragmented landscape causes analytics to be short sited and misleading, making it difficult for marketers understand customers channels preferences, not to mention the ability to react to customers in the moment when they choose to engage. This is critical: marketing shouldn’t be just about pushing what needs to be sold, but also fulfilling customers' needs and desires.
The Path Forward
The path to consolidating data across multiple channels begins with merging the adtech and martech data. Having this in the same place means that a prospect’s first touch when they are identified only by a cookie, through every single interaction with the brand is consolidated for a rich customer profile. Anything additional that is learned about a customer is then adapted to this single, comprehensive customer profile.
The next step is to start capturing real time context data, so that we understand what he or she is engaged with right now. In doing so, brands have the basis to target their interactions to create memorable shopping experiences to optimize engagement and grow with their consumers. This growth allows brands to achieve the marketing Holy Grail: customer loyalty. Further, with a full customer profile marketers are better able to measure intent. By instantaneously gathering and consolidating data, brands can understand what customers are looking at in real time, rather than making inferences as to what they intend to do next.
There is a light at the end of the martech tunnel, but it requires marketers to be strategic. When assessing marketing technology infrastructure, organizations should consider a suite to help better streamline multiple solutions and develop a more comprehensive outreach plan. In doing so, they’ll be able to eliminate the fragmented view of the customer and in turn, have a single perspective to help understand consumer interactions across channels.
Brands will only be successful when they are finally able to understand, analyze and pivot in real time to meet customers where they are.