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A marketer must be aware of the changing elements and adjust in order to appropriately coordinate marketing efforts in light of shifting consumer behavior.
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As fashion, technology, trends, lifestyles, disposable income, and similar other elements change, so does consumer behavior. No two customers are the same; they have their unique likes, dislikes, and preferences, all of which a marketer should consider while catering to them. This has become easy today, thanks to AI and personalization tools that help a marketer better comprehend consumer behavior. Terabytes of user data combined with potent AI capabilities allow us to build highly targeted, personalized advertising campaigns that can effectively reach consumers and influence their attitudes and purchasing patterns.
This leads to an omnichannel approach, which has been adopted by brands on a worldwide scale ever since the epidemic as consumers interact with brands both online and offline in the phygital environment we live in. While adtech is important, it might be difficult to target consumers who are offline.
Martech platforms are assisting in closing the gap, but much planning, strategy, and technology development are still needed to make this the best-case situation. We are looking at a world without cookies where it will be even more crucial to understand customer behavior. As chances for data collection diminish daily, it is more crucial than ever for businesses and ad tech platforms to come up with newer ways to target the consumer.Metaverse platforms and Web 3.0 should not be overlooked: Migration to Web 3.0 will be a significant event since data and privacy are critical concerns for users everywhere. The difficulty and opportunity of integrating data and privacy concerns with Web 3.0 and consumer behavior targeting is worth investing in. There were formerly restrictions on how companies could interact with their customers, but metaverse platforms now offer an infinite number of options for brands and ad tech platforms. Metaverse offers customers a simulated environment in which their avatars mirror their own real world behavior, hence offering an opportunity to understand the customer better.
Customer expectations are constantly rising, and as a result, personalization has become essential. Content and customer experiences that aren’t tailored specifically to the user are increasingly being viewed as irrelevant and personalizing an experience or message based on the knowledge a business has acquired about an individual, can help put the client at the heart of the brand's marketing. Hence personalization has gone from inessential to imperative in today’s digital landscape giving rise to the era of Personalization 2.0, where hyper-personalized customer experiences will reign supreme.Offering targeted promotions, following up after a purchase, incorporating recommendations into your product or service, adapting messages to consumers' requirements, and honoring individual accomplishments are all examples of this.
Data in personalization
Surface-level personalisation is no longer sufficient in the age of digital development. For the purpose of visualizing and learning from your visitors' activity and utilizing it in your optimization campaigns, data is gathered from various sources, unified, and analyzed. Hence the role of modern day Customer Data Platforms (CDP) has become most relevant to empower these personalization exercises.
Behavior-based recommendations are powered by cutting-edge AI and data, and they give highly relevant recommendations for each client by combining their on-site actions after only a few clicks - all without using any personal information or third-party cookies. By concentrating on what customers want rather than who they are, it is altering the way businesses actively assist their customers in discovering items and information they love. Businesses need better data, which is obtained from surfing habits, not more data.
Delivering personalized recommendations requires a deep understanding of each customer's individuality, and the easiest way to do this is through observing each person's browsing habits. Behavior-based suggestions show that personalisation and data privacy aren't incompatible by focusing on consumers' on-site habits rather than their personal information. Netflix is one of the best examples as to how a streaming platform has leveraged the customer’s viewing history (consumption pattern) to offer more content (personalized product).
Personalization vs Customization
While personalisation is all about the customers, customization is all about the product offering.
By adding a symbol or selecting the colors of a product, customization lets the customer assume the role of the maker. Retailers can personalize their product offerings by using data to provide a more distinctive and individualized shopping experience. However, the situation has changed, and today personalisation is the preferred approach. This change is brought about by the greater engagement costs associated with customization as well as distribution challenges.
Organizations that invest in hyper-personalisation by customizing offerings will generate an increased revenue and will be successful in striking a long-term relationship with consumers. They feel more confident and trust the purchasing process.
If we talk specifically about Indian consumers, they are willing to pay more for quality goods as long as they feel they are getting value for their money. Customization and personalization are key factors in consumers' shift to luxury or premium product categories. Consumers decide and put into effect the concept of buying better and fewer things. They would rather spend money on a luxury item that is personalized to them and convenient for them than to utilize a cheaper product that is simple and does not meet all of their wants.
What we can learn from Spotify about personalisation
Personalized recommendations from Spotify are currently offered based on listeners' habits and interests. However, the demand from customers for a stronger emotional bond and more customization prompted the music streaming service to raise the bar for its recommendations.
Spotify demonstrates how businesses should see the development of personalization. Customers' demands of brands and companies are rising quickly, and with it, their views on personalization. Brands must be conscious of their audience, and when it comes to creating a positive customer experience and strong customer relationships, Spotify is the gold standard for all other companies. And regardless of the sector, your company can gain from similarly adjusting customer preferences to offer individualized experiences.
Personalization in the beauty industry
Brands' in-store surveys give them a direct channel to the consumer and minimize the need to limit product development to focus groups.
With an at-home lipstick tech tool that enables customers to create a custom tint from whatever suits their fancy, luxury brands re - evaluated how they provide a customized tech-enabled approach. Artificial intelligence is used in the beauty industry in addition to robots and science fiction.
Personalization in the hospitality industry
Due to their unique personalities and wants, every traveler is significant and special in respect to their requirements. There are several types of travelers: business, revenge, family, and solo.
The backbone of smart hotels is cutting-edge digital technology. It is also feasible, given the developments in digital technology over the past few years. The hospitality industry is undergoing transition as a result of digitalization in terms of operations, client experience, and the ecosystem as a whole.
Converting customers, one experience at a time
Personalized marketing may help organizations treat their customers like people since customers expect it from businesses. Additionally, personalization can increase brand loyalty and consumer retention. Compared to when a client receives an irrelevant message, especially at an unsuitable moment, the chance of conversion rises when a firm approaches a prospective customer with the correct tools at the right time. One such example is Whatsapp for Business, where personalized pitches can be made to the customer with a higher response rate than any other mass media. The likelihood that a potential client will become an actual customer and make a purchase may increase if a business customizes its experience. This is the endgame for all businesses and what they work for. So, be it in numbers or tools, personalisation is the bedrock of every successful business idea.
(The author is the Group Chief Digital Officer, Godrej & Boyce)
Salil Murthy, managing director, Mars Petcare India speaks about how being an avid quizzer contributed to his overall development as a professional. This article is part of an ongoing series where ET BrandEquity features senior professionals from the corporate world for whom quizzing was a way of life in their earlier years.
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