The days of mass-producing generic products and forcing them on customers are gone. Today’s customers have unique needs and desires and want to interact with brands that appreciate their personal preferences. The brands that understand this and respond in kind benefit the most. Do you know how?
Customers Crave Personalization
According to data from an Epsilon research study that was published just last year, 80 percent of consumers indicate they are more likely to do business with a company if it offers personalized experiences, while 90 percent say they find personalization appealing.
While this study provides some much-needed concrete data regarding customer preferences around personalization, this desire isn’t anything new. For decades, customers have made it clear that they want products to be tailored to their wants and needs. However, until recently, it hasn’t been cost-effective for the majority of brands. But with the explosion of the internet and key changes to how businesses interact with customers, the opportunity to develop both custom products and unique experiences (at scale) has emerged.
How Businesses Can Capitalize
For businesses, there are two major ways to personalize: products and brand experiences. Some businesses personalize one or the other, while many choose to do both simultaneously.
Product personalization looks different depending on the industry a business is in. Take the boating industry as an example. Companies like Savvy Boater understand that each of their customers has a unique need. Customers have everything from bass boats and Boston whalers to center console boats and pontoon boats. In order to meet these demands, they sell custom boat covers directly from their website. Each cover comes in an array of fabrics and fit options so that individual customers can choose a quality and price that fits their needs.
Then there’s the personalization of brand experiences, which is arguably more powerful and memorable. When combined with personalized products, the results can be profound — something customer service expert Shep Hyken knows firsthand.
“The last time I bought a sport jacket, the salesperson brought out a half-dozen ties she knew would go well with it. I bought two of them,” Hyken notes. “The last time my wife and I bought a car, the salesperson showed us why we needed to spend a little more for a better digital sound system that integrates with our mobile phones. We upgraded. The other night, I was at a restaurant and the server picked up on something my colleague said and made an excellent recommendation, which he accepted. All of that is personalization, and customers don’t want that type of service only once in a while. They want it as a rule, not an exception.”
In other words, customers have come to expect personalization as the norm. If you can’t give it to them, they’ll seek it elsewhere. Yet despite this fundamental truth, many companies are still missing the mark. And it’s not that they lack the resources to personalize. In most cases, it comes back to a lack of understanding and motivation.
The Motivation for Personalization
If you’re in a spot where you don’t quite feel compelled to invest in personalized products or customer experiences, it’s time to educate yourself on why it works. Consider the findings from a recent Segment study:
- Personalization leads to loyalty. Roughly 44 percent of consumers say they’re likely to become a repeat customer after a personalized shopping experience.
- Personalization drives impulse buys. Nearly half of all customers (49 percent) buy items they don’t intend to buy due to a personalized recommendation for the brand they’re doing business with.
- Personalization leads to fewer returns. An estimated 85 percent of impulse buyers are happy with what they buy (when service is personalized) and just 5 percent of these purchases are returned.
- Personalization produces more revenue. Approximately three out of five customers say they’ve purchased something more expensive than they originally planned to buy because of personalized service.
The data provides supporting evidence to what anecdotal evidence has long shown: Customers want businesses to respect their individuality by offering them products and experiences that are tailored to their unique wants and needs. The businesses that respond accordingly will find success to be firmly within their grasp. Will your business respond accordingly?
