Businesses' interest lies in building a deep relationship with their customers for encouraging loyalty and expanding their customer base. Creating generic marketing campaigns doesn’t work anymore as readily available information has changed the entire landscape of marketing. In today’s highly competitive world, it’s important to know the needs and preferences of your customers because technologies have raised customer expectations to another height. This gives a challenge to marketers to intelligently design engagement programs that help in growing customer networks as well as brands' competitiveness in the market.
The retail industry has proven its resilience by ‘adapt and respond’ approach during the pandemic by engaging customers with a customized message of their specific interests. One of the studies conducted by E-consultancy shared that, “only 22 percent of shoppers are satisfied with the current level of personalization from brands - meaning many brands aren’t inspiring customers to purchase personalization.” Thus, where personalization has become a necessity, hyper-personalization is the inevitable future of retail. It is understanding the customer through data science and advanced analytics.
Brands need to devise a customized marketing strategy by combining real-time data and customer behavior with a supportive infrastructure and technology. It is the world of digital transformation, and investing in retail technology will help in understanding the reasons for customer purchase, return, or abandoning the cart.
Mckinsey in one of its reports shared, “Those who invest in big data and advanced analytics often achieve up to 10 percent sales growth, up to 5 percent higher return on sales, and a margin uplift of 1 to 2 percent”.
Retailers should focus on analyzing valuable data and connecting with customers. Daniel Foley, SEO, UNAGI mentioned, “The best thing about technology is that it allows you to connect your offline and online worlds. Customers expect a complete shopping experience, which you can give with the help of technology.”
Smart checkouts, quick response codes, interactive window displays, and AR/VR are providing an unexpected and delightful experience to customers as well as streamlining the inventory management system for retailers by using technology like RFID. New technology is making hyper-personalization a reality by leveraging the volume, variety, and velocity of data. Improved tools and technologies are going to change the retail landscape by changing the way customers shop in-store, build strong trust, and feel confident.
Why it is the Future?
We are living in the age of information revolution where a human in middle childhood knows to operate a smartphone and exercise choices. It’s the age of providing frictionless experiences, either by providing the list of recommended products or organizing their playlist. Brands have to ensure the capability of taking action to the customer insights. ‘Context is the King’ and marketers have to understand the background of data in terms of its description, its outcome, and its best action. To beat the competition hyper-personalization is one of the best amazing solutions which increases the number of sales, and satisfied customers in return leading to increased revenue.
As per the BCG report, “Retailers noticed a 25 percent increase in revenue persistently resulting from their superior personalization capabilities. 110 percent of shoppers indicated that they might add extra objects to their baskets if the expertise was private.”
Hyper-personalization is smoothening the customer experience, driving the engagement strategies, acting as a motivator to achieve better, reaching the right customer in right place, and identifying the true needs in the conversation. To keep customers hooked, privacy around customer data is a big challenge that is not always acceptable. It needs huge planning and continuous learning from the ‘person’ in ‘personalization’.