Dive Brief:
- Nordstrom, Sephora and Amazon were selected as peer-voted best-in-class retailers proactively using personalization in their marketing initiatives, according to a press release.
- For the best-in-class ranking, Michael Phelan, founder and principal at Go-to-Market Pros, interviewed 70 retail executives in the second half of last year, per the press release. The executives were from the following categories: mass merchandisers, e-commerce, department stores, pharmacy, specialty retail, big box retail, and grocery and meal kit delivery.
- While shoppers expect a personalized experience, only 22% of consumers reported satisfaction with the level of personalization they are now being provided with, according to an October study by Segment. Consumers are expecting personalization almost immediately, with 54% anticipating a personalized discount within a day, and 32% saying they expect it within an hour of sharing their information with a merchant.
Dive Insight:
Much is said about personalization for retail loyalty programs, but few do it right or do it well. Further, much is misunderstood, thus the need for a comprehensive study of best practices.
"Personalization is quickly becoming one of the most important factors determining retailer success," Phelan said in the press release. "Today's consumer expects seamless omnichannel personalization when interacting with retailers. This the first study to uncover peer-voted prowess in advanced retailer personalization."
There is significant potential for personalized offers to increase customer loyalty, according to Segment. Of respondents in that study, 44% said they were likely to become repeat purchasers following a personalized shopping experience. Such offers can also increase sales, as 49% of the consumer sample said they bought an item they weren't planning on upon receiving a personalized recommendation.
Brian Solis, principal analyst and futurist at Altimeter, a digital analyst group at Prophet, advocates extreme personalization in marketing strategies. "Customers now expect more than personal engagement, they also demand engagement at the right time, on the right device, with the right message," he wrote in an op-ed for Retail Dive.
Artificial intelligence is also a means of reaching greater personalization. For example, DSW recently partnered with AI-based marketing optimization and analytics software company Marketing Evolution to measure advertising results and optimize media plans for more efficient and cost-effective campaigns.
