personalization data

What does “getting personalization right” look like? It’s a more complex question than you might think. No two businesses are the same, and every company’s customer base is different. To top it all off, customer expectations are always changing, so an experience customers once appreciated may lose its effectiveness over time.

Last week, Evergage hosted a webinar, “Retail Holiday Season Planning: The Role of Data, AI and Personalization.” Sucharita Kodali (VP & Principal Analyst at Forrester) together with Yujin Kim and Angela Yun (Merchandising Managers at NeweggFlash) discussed challenges and opportunities facing the retail industry and offered campaign ideas retailers can use this holiday season. Watch the full webinar replay for their perspectives and tips.

But beyond the retail-specific focus of the webinar, Sucharita noted that when she’s asked which companies are doing personalization well, what they’re really asking is who is doing data well. I want to dive into that idea a little in this blog post.

You can’t act on data you don’t have or can’t access

There’s a lot that goes into a good personalized experience: the people, the process, the technology — those are all important. But at the end of the day, you need to have the right customer data in the right place to deliver an effective personalized experience.

Think about your own customer data. Where is it located? Can it be easily accessed by the system(s) that decide which experience to show an individual? Chances are, your data is scattered across systems and departments within your organization. And that’s a problem, because unless you can personally talk to your customers each time they interact with your company, analyzing and interpreting customer data is how you get to know them. And once you know them, you can interact with them at the individual level. But you can’t expect to know them if the data about them is spread out across the organization.

The customer data platform (CDP) has emerged as the solution to this siloed data challenge. The official definition of a CDP is “packaged software that creates a persistent, unified customer database that is accessible to other systems.”

But that definition doesn’t mention why you want to bring all of that data into one system in the first place. Ultimately, the end goal is to act on it in some way. That action can be anything from passing data from one system to another, triggering an alert or notification that something could be wrong or worth paying attention to, or tailoring a customer experience (in other words, personalization).

Personalization cannot take place if there is no data — or not enough data — to act on.

As a result, as Sucharita said, getting personalization right can be considered a data challenge more than anything else. You can conceive of the most innovative and exciting personalization campaigns, but if you don’t have the data behind them, those campaigns will never see the light of day.

Activation in action: NeweggFlash holiday shopping

NeweggFlash is a flash sales site dedicated to providing shoppers with a wide range of consumer tech products at attractive prices for a limited time period. As you would expect for an e-commerce site, the holiday season is a critical time for NeweggFlash.

After learning that NeweggFlash holiday shoppers are often seeking “stocking stuffers,” the team wanted to promote items under $250 on the homepage during the 2018 holiday season to make those items easier to find.

But because NeweggFlash’s product catalog is constantly changing, it would take a lot of ongoing manual effort for the merchandising team to select stocking stuffers to promote on the homepage. And the team didn’t want to randomly select products, because they wanted items that were individually relevant to each shopper’s preferences to increase the chances of clickthroughs.

Customer data is essential in selecting those individualized recommendations. Why? Because brand and product preferences aren’t something you automatically know. You have to pay attention to each person’s behaviors both over time and in the current session, and then make inferences about what those behaviors say about each person’s underlying preferences. Is he brand-loyal or does he like to explore new brands? Is he price-conscious? What types of products is he generally interested in? What is he looking for today? Without in-depth behavioral data and the ability to interpret it, you can only suggest items other shoppers have looked at, without the individual focus.

NeweggFlash was able to capture and interpret all of this information, and then rely on machine-learning algorithms to pick the most relevant product recommendations. And, this simple yet effective personalization campaign delivered an impressive 40% lift in revenue per user during the holiday season.

personalization data

Final Thoughts

When Sucharita is asked which companies are getting personalization right, she says what she’s really being asked is who is managing their customer data well.

That’s because while good personalization can vary pretty dramatically depending on the business, its goals, and its customers’ expectations, one thing never changes. Experiences built around a deep understanding of the individual customer never go out of style. To learn more about how Evergage can help you manage your customer data and activate it to deliver more effective individualized experiences, request a demo today.