Personalisation at scale is the north star for customer-obsessed brands today (and any brand with a growth plan has likely embraced customer obsession).
It’s the ability to deliver a unique experience tailored to the circumstances, values, and behaviours of an individual – that meets them where they are in the context of a specific moment in their journey and responds to each next step.
True personalisation is the power to elevate marketing to a conversation with your customers, instead of a monologue inflicted at them. Harnessing that power brings proven benefits across a spectrum of business outcomes and objectives. This post compiles information on a number of those benefits and may serve as evidence and impetus to support future investments in the capabilities that enable delivery of true personalisation at scale.
We’re in the Customer Expectation Economy
Perhaps most importantly, mastering personalisation enables brands to meet the ever-rising bar of customer expectations:
In a survey by McKinsey, 71% of consumers say they expect personalisation.1
- 62% of consumers say they not only want but expect companies to send personalisation – and that a brand that doesn’t offer a personal experience could lose their business.2
- 56% of customers expect offers to always be personalised.3
- 88% of customers say the experience a company provides is as important as its products or services.4
Overall – and despite privacy concerns – the vast majority (90%) of consumers in the US find the idea of personalisation appealing.5 On the other hand, 76% of consumers say they get frustrated when companies don’t provide personalised interactions.6
Personalised Content Connects and Converts
When content addresses consumers’ needs and behaviours at a personal level, experiences can unlock, accelerate, and improve buying outcomes:
- First-time purchases: 67% of consumers say their decision to buy from a brand the first time is influenced by relevant product or service recommendations influences; 66% say tailored messaging likewise influences their purchase intent.7
- Repeat purchases: 78% of consumers said that personalised experiences make them more likely to repurchase. The same number say they are more likely to refer friends and family to companies that personalise.8
- Share of wallet: 84% of customers say being treated like a person, not a number, is very crucial to winning their wallet.9
- Transaction size: 80% of business leaders say customers spend 34% more on average when offered personalised shopping experiences.10
Overall, studies have identified a $5.6 billion increase in revenue influenced by consumers who increased their spending due to cross-selling or personalised recommendations.11
Personalised Offers Increase Sales and Improve Loyalty
Like personalised content, offers and coupons that are uniquely individualised for shoppers and their position in the buying (or post-purchase) journey also have a big impact:
- 80% of consumers are more likely to shop from a new brand if it provides a discount coupon, and that number jumps to 89% for millennials.12
- 65% of US consumers expect brands to offer them personalised promotions. 59% expect brands to send timely communications tied to key moments.13
- A Mastercard rewards study found that when cardholders receive personalised offers, issuers see up to 18% spend increase from customers who redeem, and a 75% reduction in churn.14
- 49% of consumers said they would likely become repeat buyers if offered a personalised experience by a retail brand.15
Again, the costs of getting it wrong are very real: 55% of business buyers (and 54% of consumers) get annoyed when targeted with an offer for something they’ve already purchased.16
Personalisation Drives Competitive Business Advantages
Taking a broader view, 97% of marketers witnessed a rise in business outcomes as a result of personalisation.17 More specific outcomes driven by personalisation include:
- 1.7x year-over-year growth in revenue.18
- 2.3x year-over-year increase in customer lifetime value.19
- Personalisation has also been found to reduce customer acquisition costs by as much as 50%.20
Companies that grow faster drive 40% more of their revenue from personalisation than their slower-growing counterparts.21 But only 47% of companies offer personalised experiences based on live consumer data, meaning over half are missing out on a significant aspect of personalisation.
Personalisation Unlocks Returns of Better CX
71% of consumers say personalisation is important to a great customer experience.22 This demonstrates the crucial importance of personalisation to unlocking the broader benefits of a superior customer experience:
- Experience leaders reported 3x higher revenue growth over the past 2 years than businesses that place less emphasis on CX enhancements.23
- Improving CX increases sales revenues by 2 to 7%, profitability by 1 to 2% and the overall shareholder return by 7 to 10%.24
- 78% of consumers say they are more likely to be a repeat customer if they had an amazing customer experience on a digital channel.25
There are scores of additional statistics demonstrating proven power of personalised customer experiences – increases in campaign engagement, conversions, channel performance, loyalty, lifetime value, brand esteem, overall marketing ROI, and a long list of others.
Leading brands are investing big to activate these benefits and gain a durable advantage over competitors. “Personalisation” is among the top three areas for increased investment among marketers, with closely related capabilities – data quality and AI – named as the other two.26
Especially as companies move away from reliance on third-party cookies, the key capabilities of personalisation at scale – such as identity resolution, decisioning, contextual targeting, and modern data management – grow more important than ever before.
Is your brand on a solid path to personalisation at scale? To get insights from experts on Merkle’s technology strategy team, contact us today.
1, 6, 7, 8, 13, 21, 22. The value of getting personalisation right—or wrong—is multiplying, McKinsey, 2021
2, 10, 15, 22. Twilio - State of Personalisation, 2022
3, 4, 9, 16, 24. Salesforce – State of the Connected Customer, 2022
5. Statista, Marketing Personalisation in the United States, 2021
11. Adobe, Personalisation at scale has never been more crucial for your business, 2022
12. Statista, Share of Shoppers in the United States Who Would Try a New Brand if Offered a Discount Coupon, 2020
14. Forbes, Why Personalisation Is The Holy Grail Of Loyalty, 2021
17. Salesforce, Trends in Personalisation, 2020
18, 19. Adobe, Personalisation at Scale has Never Been More Crucial for Your Business, 2022
20. AdWeek, Recognizing the Importance of Personalisation, 2018
23. IBM, Optimize your DXP capabilities: Experience Leaders are prioritizing digital transformation for CX, 2021
24. Prediction: The future of Customer Experience; Salesforce, State of the Connected Customer, 2022
25. Verint, The 2022 State of Digital Customer Experience Report, 2022
26. Redpoint/Harris Poll, “Revisiting the Gaps in Customer Experience.” 2021