In the digital and customer-centric era, a factor that becomes essential to achieve a relevant connection with consumers is hyper-personalization. The relevance that brands must have with consumers today is more important than other initiatives that worked in the past. One element to achieve relevance with customers is precisely through hyper-personalization.
The difference between personalization and hyper-personalization is that the former uses personal and transactional information such as demographic information and transaction history. The second goes further, using real-time and behavioral insights to create highly relevant content for the customer.
Hyper-personalization is reaching the maximum degree of customer knowledge through technology such as AI, ML and real-time data to deliver more relevant content and experiences based on what the consumer wants and is thinking. Delivering hyper-personalized content and experiences is a big challenge for brands that want to reach this level of intimacy with consumers.
There are 3 elements to consider to achieve this:
- Real Time Data (RTD)
Real time data is data that is collected as soon as it is generated. Instead of being stored, it is sent to users after it is created and is immediately available. This type of data is available everywhere, after a bank transaction, after a purchase in a convenience store, after having traveled from point A to point B, to name a few examples.
In other words, talking about data has gone from storing it to using it in real time. Brands that wish to have relevant hyper-personalization should consider using RTD in processes such as customer service, product experience, and operational process optimization. Personalize the customer’s experience with a product according to the real-time data that the customer is generating. Real-time personalization translates into personal content that is communicated via SMS, mobile app, website, among others.
- Artificial Intelligence and Machine Learning (AI & ML)
The use of AI and ML tools to achieve hyper-personalization translates into the use of recommendation engines and chatbots, to name two of the most common. This allows you to enable conversations with customers based on the predictions and needs of each one, delivering a true hyper-personalized service.
The Starbucks rewards program uses AI and RTD. The system can send over 400,000 hyper-personalized message variations based on transaction history per user:
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- Hyper-segmentation of customers and personalized journeys
Through the use of RTD applying AI and ML, hyper-segmentation of customers can be achieved, which means how brands manage to create audiences in smaller groups. With hyper segments, personalized journeys with relevant messages can be created, which will translate into higher income for the brands that manage to do so.
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Hyper-personalization is part of digital transformation. Its use can be in several ways, loyalty being one of the most common. Finally, achieving hyper-personalization can create greater engagement and commitment of customers with brands by feeling recognized and treated in a special way. If not, ask Starbucks, which has more than 27.4 million users in the US enrolled in its loyalty program, being responsible for more than half of all orders. (source: White paper).