Blog Post - Hugh Fletcher, Mar 13 2020

Understanding the age of hyper-personalisation

Understanding the age of hyper-personalisation

The idea that the retail world is veering towards hyper-personalisation is nothing new.

But what does this hyper-personalisation actually mean? Fundamentally, it is the concept of brands listening and communicating with customers at every touchpoint. This helps predict behaviour so that customers are provided with what they want, when they want it.

Take holidays for instance. Why wait for a customer to proactively enter the holiday market, when data will tell you where, when and what is normally booked? Or even anticipatory shopping – the ability to offer something to consumers without ordering them – something that Amazon has long talked about? Proactive inspiration will allow brands and organisations to target customers rather than wait for them.

However, as the trend accelerates, larger and more established businesses are finding it increasingly difficult to accommodate their customers’ ever-rising and morphing expectations. This has allowed businesses – driven by their need to rapidly gain customers and cashflow – to take advantage of their competitors’ weak underbellies.

Customers are now less loyal to brands than they are to service. So, unencumbered by legacy systems and cultural blockades like red tape and layers of hierarchy, these newcomers have been able to move closer to customers and listen. Amazon, Google and Facebook don’t focus on creating their own products. They’ve all become what they are today by providing incredible services through the effective use of customer data. This is the antithesis of how large companies have long operated, previously choosing to invest in brand equity and product development.

We live in an omnichannel world and the pressure is on for these organisations to transform their business models to accommodate this new way of commerce. But with the rise of customer experience design (CxD), customer mapping, service design and blueprinting, these firms can now identify their friction points and improve their offerings...

…if they’re willing to evolve.

Interface imperialism

Start-ups have managed to become customer favourites by not only embracing omnichannel, but new zero UI interfaces such as voice and automated purchasing.

Amazon, for example, has mastered this approach. First, the company made sure it spanned every conceivable digital channel: web, mobile, content and hosting.

Then it slowly began to move into the physical world with the purchase of Whole Foods, its 4-star stores and Amazon books.

The goal: to become the default choice for whatever the customer wants to do.

This is what we call ‘interface imperialism’ – aiming to ‘own the customer’ through the control of interfaces. This is so effective because if you own the interface, you own the customer. If you own the customer, you own the data.

And if you own the data – you own the future.

Interface imperialism has also allowed Amazon to compress the purchase funnel: increasing the proximity to the purchase across the various phases of the purchase funnel – inspiration, search and purchase itself.

The theory is that if you can move a customer through these various stages more quickly – and in one ecosystem – they’re less likely to purchase elsewhere.

And it’s clearly working. In the UK, 56% of all product searches now start on Amazon, with 35% of all online sales completed there.

Through data, Amazon has enabled easier search, better ratings, faster checkout and smoother logistics.

Programmatic Commerce™

We tend to think about personalisation in terms of interactions. But in the future, personalisation will mean the very opposite – fewer interactions. Customers will only receive the goods, services and interactions they need or want.

Take Programmatic Commerce™ AKA machine-automated ordering. Personalisation will eventually be so far advanced that organisations will know when to replenish what you’re running out of at the right time. Essentially, this will be a personal, just-in-time stock system.

This will move personalisation away from ‘recognition’ towards ‘knowledge’. Organisations will be able to use data to proactively inspire customers at the right time.

Why wait for a customer to enter the holiday market when data will tell you where, when and what they normally book? Proactive inspiration will mean organisations will target customers rather than wait for them.

This is why we’re seeing the likes of Amazon and Google trying to embed themselves in their customers’ lives through voice assistants in homes, cars and phones.

It’s still personalisation, just not as we know it.

The future of personalisation

In a world of disruption, knowing what to do next can be frightening. But the best incumbent brands focus on what their strengths are – and it isn’t always all about data.

Walmart, for example, used its 90% coverage of the US as an advantage by offering customers added convenience through services such as pick up in store towers and kerbside pickups.

At the end of the day, the answer is simple but powerful: get the basics right:

  • Listen to your customers
  • Identify key touchpoints
  • Create a single unified data record for customers that works across channels
  • Drive actionable insights from your data
  • Act on them!

You’ll need to identify more automated methods of providing customers with services and products to reduce their cognitive load and promote ease, speed and convenience.

But ultimately, you’ll need the heart of a retailer and the brain of a start-up to succeed in digital commerce today.