A Mckinsey & Company Report 2021 found that 78% of consumers are more likely to make repeat purchases from brands they customize. Almost 80% are more likely to refer their family and friends to these companies.
As we know, personalization is the name of the game in today’s user experience. In this post, we’ll dive into the key personalization trends you should know about in 2022.
The demand for personalization is increasing.
According to Twilio’s The 2022 State of Personalization Report62% of consumers say a brand will lose their loyalty if they provide an uncustomized experience, up nearly 20% from 2021.
Another Zendesk report suggests that user experience is more important to consumers now than it was before.
This rise in the need for personalization didn’t start until recently, but was fueled in part by the pandemic of 2020. It was a time of uncertainty that forced most consumers to stay indoors and online for extended periods of time.
A Mckinsey & Company report reported on this 75% of consumers have tried a new shopping behavior during a pandemic. Consumers are looking for more valuable experiences from the brands they interact with.
In fact, the same study revealed that more than 70% of consumers now expect personalization and are disappointed when they don’t find it—making personalization imperative for today’s brands.
Online personalization takes priority.
According to a Zendesk Report 202165% of customers want to buy from companies that offer fast and easy online transactions.
The report also finds that online businesses are more successful, with e-commerce brands leading the way in consumer engagement.
Here’s why: The web offers far more opportunities for personalization than in person. You can target users by seeing your ad, then follow them along their journey as they discover your products and consider making a purchase.
In person, shoppers tend to view generic displays followed by generic in-store experiences. Meanwhile, brands can’t collect any data on items that customers have viewed and considered unless a purchase has occurred.
These barriers make it easier for many brands to adjust their marketing efforts online.
Multichannel mode is the main way forward.
Only 35% of companies believe they are successfully achieving multi-channel personalization, up 13% from 2021 – according to Twilio’s The 2022 State of Personalization Report.
As consumers now actively engage across multiple channels, effective personalization depends on a multi-channel approach that meets consumers where they are, not where brands expect them to be.
When it comes to personalized marketing, it’s pretty bad.
— Cole Cook (@cwcook22) June 24, 2022
One 2021 report from Vonage revealed that 26% of consumers very likely to stop buying from the company if they cannot switch between communication channels.
However, McKinsey & Company sees some obstacles to a seamless multi-channel strategy. Here are the two main ones:
- Traditionally, digital and customer-facing channels operate independently, so changes require software and hardware to interconnect.
- It involves changing the flow of the customer journey, which involves retraining staff and modernizing the process.
While these are not minor challenges, they can be solved with the right team and resources.
Companies will prioritize their own data as privacy concerns increase.
With the end of third-party cookies and recent data privacy laws, brands have had to change their approach to data collection. This shift has created a domino effect affecting personalization strategies.
According to Twilio’s The 2022 State of Personalization Report37% of brands use first-party data exclusively to personalize customer experiences, up six percentage points from 2021.
Why? The first reason is better quality data, according to 54% of respondents. The report shows that accurate data is a particular challenge for brands, preventing them from fully implementing personalization strategies.
Other reasons include better privacy and easier management.
Collecting their own data allows companies to make better decisions faster and integrate their systems more easily for a seamless experience – for both marketers and consumers.
Key tips on personalization
- Customization is not personalization. Customization is explicit, while personalization is implicit.
- Intent customization can be achieved by understanding what people engage with on your site.
- Never forget that no matter how much technology changes, the key to great marketing is a deep understanding of your users.
- The future of marketing is in creating personal websites, products or experiences in a very meaningful way.
- Customizing search results offers an opportunity to increase your visibility for truly relevant searches.
- The potential to engage customers contextually based on need and a service that will power mobile devices in real time as they become payment vehicles.
- Personalization has gone beyond segmentation to algorithmically driven content.
- Personalization is all about getting the most out of individuals when they reach your inbound customer touchpoints.
- Don’t think about the different groups you want to market to. Consider the power of one and how to reach that person in the most personalized and creative way.
- The three-step approach to personalization is: listen, educate and engage.
- Think customer-centric recommendation engines instead of company-centric sales engines.
- Personalization is about creating a natural conversation between businesses and customers.
- The three keys to balancing personalization and privacy are company transparency, consumer choice and accountability.
- With personalized ads, the goal is to achieve the highest point of relevance with the lowest sense of intrusion.
- Instead of thinking of data privacy as a limitation, consider that what needs work may be value.
- Marketers can get too focused on the details and forget to focus on the most important aspect: relevance.
- Customized marketing isn’t just for customers and prospects—it can effect change within an organization.
- We’ve moved from optional, allowed and customized title fields in personalization to relevant online conversations that engage and inspire.
Editor’s note: This post was originally published in December 2021 and has been updated for completeness.