Use Customer Data to Improve the Digital Customer Experience

Digital personalization is about more than simply using a customer’s name or showing them an ad over and over that they engaged with once. This said, to personalize effectively, you don’t need to know everything and anything about your audience. Opt for a lean data approach (in contrast to big data), and only capture and store information that’s directly relevant to the personalization efforts you intend to pursue.

Then:

1. Segment customers and personalize to groups
2. Run experiments to A/B test messaging
3. Eliminate data silos to improve customer journeys

1. Segment customers and personalize to groups

One way to semi-personalize the digital experience while steering well clear of the creepy factor is to personalize based on group rather than individual data. To apply this, you’ll need to start with a strict data segmentation regime.

Map and segment data based on:

• Location
• Demographics
• How they interact with your business
• Traffic source
• New or returning customers
• Account preferences
• Past Purchases

Then, consider how you’ll personalize online experiences based on each of these factors.

For example, location-based segmentation allows you to navigate users to a regional website, ensuring aspects such as pricing, local grammar and spelling (z vs. s, o vs. ou, etc.), and available features are relevant to the viewer. Demographic data can also guide you as to how much personalization you should apply. For instance, older generations (Baby Boomers and prior) tend to feel more violated or offended by personalized targeting, whereas younger groups (Millennials and Gen Z) are more inclined to appreciate relevant, personalized content. By segmenting data in this fashion, you can personalize the experience to a higher degree for those who welcome it and take a traditional approach for those who don’t.

2. Run experiments to A/B test messaging

One of the biggest reasons businesses run into trouble with personalization is working based on assumptions. They assume that their target audience resonates with X, wants Y, and hates Z. But they don’t A/B test these assumptions.

Use growth marketing-style experiments to learn how and why segments act differently and optimize digital personalization accordingly. For example, you might start with the simple assumption that customizing digital ads using the name of your prospect’s company will result in a higher click-through rate (CTR). To A/B test this assumption, you design an experiment. 50% of customers will be shown personalized ads using their company’s name; the other 50% will be shown a standard ad.

Then, analyze the results and dissect them based on relevant characteristics: If, for instance, your assumption was correct, and the cohort that was shown a personalized ad did convert at a higher rate, dig further: did any particular age group, industry, or company size respond to the personalization significantly differently from the others? Or was the response the same across the board? If the opposite is true, and this kind of ad personalization had no impact on CTR, scrap the initiative.

Your experiment showed that there is no need to spend time and money on that particular kind of personalization, and you risk crossing a privacy line with no potential upside.

3. Eliminate data silos to improve customer journeys

When customer journeys are clunky and disconnected, personalization efforts appear cheap and obvious. By eliminating silos and democratizing access to customer data, you’ll ensure all teams are on the same page, from marketing through to success.

Messaging at every touchpoint becomes more relevant, and the customer journey appears seamless. New York Times CEO Mark Thompson credits the removal of data silos and an organization-wide obsession with the customer journey as critical drivers behind the Times’ digital transformation.

Store information in a centralized data platform, and ensure key insights are accessible to all. Marketing, for example, should be able to analyze sales data on the account management end (in order to improve targeting) without having to seek access from a sales leader.

In summary, by choosing a lean data approach and using only the relevant data to pursue your personalization efforts, your personalization will be more effective. Your key to success in digital personalization lies in engaging in customer research and gathering first-party data to understand your customers’ preferences when it comes to privacy and personalization.

Do you want to learn more? This article is part of the ebook How To Overcome The Personalization Paradox. Download today!

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