Why Marketers Still Struggle With One-to-One Personalization

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Photo by Mario Purisic.

Personalization has long been touted as the future-proof way for businesses to connect with and retain customers. With Gartner predicting enterprises will win or lose due to customer experience in 2019 and beyond, offering customers meaningful, personalized experiences takes on even greater importance.

To uncover the truth about how personalization efforts are affecting the bottom line of the Global 2000 and just how much one-to-one personalization is taking place, we conducted a survey with Forbes that asked 200 marketing leaders just that.

Personalization Is Driving Growth When It is Prioritized

The report finds that many marketers still struggle to achieve the one-to-one personalization they seek, but when they do, their efforts pay off. Two in five executives (40%) report their customer personalization efforts have directly affected sales, basket size, and profits in direct-to-consumer channels such as e-commerce.

And not all enterprises are coming up short. Twenty-one percent of respondents were identified as “personalization leaders,” indicating they consider their organizations to be competitive or highly successful in their personalization efforts, and their organizations have committed at least 10% of marketing spend to personalization.

Marketing executives recognize the value of personalization in their larger strategy, but the momentous task of marshaling both technical and organizational resources can hold it back as a priority. In total, 41% of survey respondents say their organizations currently view personalization as a high priority. A leading 9% indicate it is a “very high priority” for the year ahead.

Not surprisingly, those who prioritize personalization efforts are reaping the rewards. In fact, 54% report they exceeded their revenue targets over the past year, compared to only 15% of other respondents.

Obstacles to Personalization

Why is the overall pace of adoption and implementation of personalization slow? Organizational issues tend to inhibit personalization initiatives, the survey shows. Along with the technical challenges of bringing together data from disparate silos to address customers on a consistent, one-on-one basis, organizations need to be ready to take full advantage of personalization technologies, which involves corporate buy-in, the right talent, and more.

One of the leading roadblocks to achieving a personalization-driven culture is data quality — a technical challenge cited by 48%. Data is the fuel that powers personalization, but using the wrong data may defeat the entire personalization effort. It’s essential for data to be accurate and relevant to the customer — or else the relationship may break down.

Change management issues, the challenges involved in bringing managers and employees onboard with new processes and requirements, also present a challenge to enterprises looking to further personalization efforts. The workforce itself can be a hindrance. Executives cite a lack of analytical acumen and skilled workforce, along with a lack of people and resources dedicated to personalization, as a major hindrance to personalization efforts.

Tellingly, only 30% of all respondents strongly agree that they have sufficient experience on staff with marketing technology platforms, and just 23% say their organizations are equipped with sufficient digital media targeting experience.

How Enterprises Are Getting Personalization-Ready

Encouraging and activating a more comprehensive personalization strategy requires technology and teamwork. Enterprises will be stepping up organizational efforts to consolidate and centralize their data to achieve greater customer personalization. The top priorities for the year ahead include establishing a center of excellence or expert team dedicated to personalization (56%) along with consolidating data into complete, unified profiles to establish a single source of truth (55%). It’s clear that executives see a need for greater coordination, collaboration, and integration of enterprise resources.

Personalization is not a technical endeavor — it is a people endeavor. Remaining competitive — and indeed, thriving — in today’s global digital economy requires staying close to the customer and interacting with him or her on a one-to-one basis, amplified by technology. The leaders in this survey are seeing success because they have transformed their organizations and their processes to better serve and listen to their customers with intelligence gained through data.

Erik Archer Smith is a data-driven marketing and sales professional at Arm Treasure Data with 10+ years experience helping companies scale during phases of hyper-growth. Erik got involved with tech early and built the first social media site in Japan using open source technology in the early 2000s. When not working, he enjoys spending time at the beach with his wife and dog, and obsessing over character-build stats in whatever RPG currently has him hooked.