Can personalization impact digital commerce performance? – Client experience

In recent years, we have seen a significant shift towards “digital commerce” as a key strategic priority something that has been accelerated by the global pandemic. In Gartner’s inaugural digital commerce survey, 86% of marketers said digital commerce success will be key to business performance. The question is… ‘how’. Specifically, how can brands make the most of their digital commerce efforts and seize what looks like a really exciting growth opportunity.

Of all the levers considered, the most promising seems to be focused on “improving the customer experience”. More specifically, personalization seems to be a really interesting digital commerce enabler.

It makes sense. The more customer data can be acquired and used, the better brands can deliver more timely and relevant experiences. This can be done through real-time delivery, personalized content, and a more connected journey overall.

However, we are finding it increasingly difficult to achieve good customization for two reasons. First, operationalizing personalization is becoming increasingly difficult. It has always been difficult to acquire and use customer data in the first place, but lately that mountain has grown even higher due to increasing data complexity, regulations, and privacy concerns.

Second, customization requires a delicate balance. On the one hand, poor personalization can have a hugely negative impact on the customer experience. But on the other hand, so does doing it so well that we deliver messages that seem intrusive or scary. In fact, the 2022 Gartner Personalization Survey found that the consequence of over-personalization was significant, with 37.5% of customers more likely to stop doing business with a brand upon receiving “frightening” communications. versus those that are “irrelevant”.

An approach that works

Although good customization seems to be getting harder and harder, the good news is that the benefits to be realized seem to be significant if we get it right.

Gartner’s latest study on personalization which included over 20 interviews with marketing executives and a global survey of 1,500 customers who interacted with a personalized digital experience revealed that effective personalization has the potential to drive sales performance, with a potential increase of more than 30% on Gartner’s Sales Benefit Index (a metric that tracks brand intent, purchases , repeat purchases and growth).

However, of all the different approaches currently used to design and deploy personalization, only one delivers the benefits described above…an approach we’ve come to call “tailored help”.

Tailored help is an approach based on helping customers through their buying journey in a brand-neutral way using only a very limited amount of customer data. This forces brands to understand their customers’ needs and deliver an experience that gives customers easy-to-use and actionable help. Ultimately, our research revealed a simple truth: the more we (the brand) can help customers explore their needs in a way that makes them feel in control and making the right choices for themselves, the more they will be likely to reward us. for that.

Conversely, the least effective messages were those that customers perceived to be highly personalized but lacking any sense of help. In other words, messages that demonstrated a great knowledge of the customer but also seemed to communicate the message “We know you…”. This type of message is also likely to be perceived as “scary” by customers if a large amount of customer data has been used.

Some notable exceptions

Our research also reveals some minor but important differences in terms of customer appetite and preference for personalization.

First, despite very similar earnings patterns across all industries assessed, some industries seem to be more comfortable with the data (both the volume and type of data) that customers are willing to share with. them. In financial services, for example, we found that consumers are nearly 70% more willing to share their personal information than brands in other industries (see “Top 4 Consumer Personalization Findings Critical for Financial Services CMOs “).

Second, the B2B world seems to be more open to a higher degree of customization than B2C. Additionally, our research indicates that B2B customers are also more comfortable sharing most types of data in an effort to receive a more personalized overall experience. However, the risk of getting the personalization wrong also appears to be higher, with a higher proportion of B2B brands indicating that they would stop doing business with brands that are not very and/or overly personalized.

This article was republished with permission from the Gartner Blog Network.