Did you know that 74% of people are ready to pull out their wallets for “the special experience”?
To get that experience, people are ready to trade their personal data. It’s how our consumerist brains work. With that insight in mind, managers put together robust strategy decks on how to harness the collected data and create what people want.
Since our data processing abilities have their limits, we use AI/ML tools. The algorithms help us make sense of what’s happening… And predict what should happen next.
With strong predictions, we can create an entire universe of experiences for our customers upfront. And if AI is so powerful, why don’t we personalize that universe on the go, at the same time as we collect the data?
Say hello to hyper-personalization.
What is hyper-personalization
Hyper-personalization is a process of using data analytics and collection tools, and Artificial Intelligence/Machine Learning algorithms to process that data and automate experience creation, tailored to customers’ needs, in real-time.
In other words, it’s a process of analyzing the customers’ data and adapting the experience to their needs where they need it, when they need it – automatically.
That’s the equation. Data + algorithms + automation = hyper-personalized experience.
What’s the difference between regular personalization and hyper-personalization
Regular personalization is using your customer’s first name in an email. Or saving their settings in the app so they don’t have to set up everything again from scratch.
Hyper-personalization means going one level beyond that. Let’s say you have a smartwatch that suggests outdoor exercises.
Now imagine it collects the data about the weather on your location, your mood, blood pressure, overall fitness level… And gives out a personalized exercise plan.
How does your business benefit from hyper-personalization
Implementing hyper-personalization into your company’s marketing efforts means two things.
- You’ll get a new department that deals with data on a whole new level and you’ll start de-siloing departments. We’re talking about huge commercial potential – 48% of companies say their biggest hurdle is ineffective communication.
- Your business will increase the bottom line because better CX means more loyalty, which means more profits.
Here’s the data to support these claims.
Better customer experience means more business
As stated in the Deloitte report, 80% of people are more likely to purchase from a company that offers personalized services.
With so many high-quality options on the market to choose from, customers are now picking out nuances. Adapt the communication and plans more accurately to their needs and you’re already much closer to making more sales.
Optimized spend on marketing
In this Salesforce report, 58% of marketers report a 10% or greater lift in sales thanks to personalization. This means that they have a better understanding of where to put their budgets in the next 3-5 years.
It’ll help you stay ahead of the competition
In a survey by Ascend, only 9% of surveyed companies consider implementing a hyper-personalization strategy. This means hyper-personalized solutions still haven’t flooded the market.
Practical use of hyper-personalization + real-life examples
Industries where hyper-personalization makes a powerful impact are financial, medical, and retail.
- Imagine how much time and billable hours a bank saves if it sends automated offers to clients based on their risk levels, preferences, and expressed needs.
- Medical institutions could send personalized treatment plans and suggestions or further tailor experiences to patients and their conditions.
- In retail, imagine predicting what your customer would like to buy next and personalizing offers by using data from their previous purchases – what channels, how much, how often…
The biggest real-life example of hyper-personalization at scale is Netflix. Their recommendation system is one of the most sophisticated AI-based recommender systems on the planet.
According to the Netflix’s website, they track:
- your interactions with the service (such as your viewing history and how you rated other titles),
- other members with similar tastes and preferences on their service, and
- information about the titles, such as their genre, categories, actors, release year, etc.
- the time of day you watch,
- the devices you are watching Netflix on, and
- how long you watch.
They use all of this information to create a seamless experience for you.
Recommender systems are projects we have lots of experience in. Check out our case study section or contact us for more information.
Dangers of hyper-personalization
Push hyper-personalization too far and it may seem like you’re stalking your users or “reading their minds against their will”. That’s why we advise engaging an advisor that’ll help you tackle ethical challenges of technology.
Apart from that, collecting and combining so much data puts you in a sensitive position. Data breaches are common, even for corporations. Before handling sensitive data, invest in strong cybersecurity measures.
The future is hyper-personalized
More revenue, stronger brand loyalty, optimized budgets – what’s there not to love? As more and more companies realize all the possibilities of AI, we can expect a future where we see our names over every app, in every recommendation system, and on every smartwatch screen…
A future where we don’t “change our settings” to adapt a product because it will adapt to our needs automatically.
However, implementing machine learning/artificial intelligence and becoming a data-driven company that provides such a stellar experience isn’t a walk in the park.
We’re a brain-powered AI company that helps businesses like yours to harness the power of data and make firm decisions for their future. If you wish to hear more about how your company and customers can benefit from hyper-personalized service, reach out to us today.
Written by: Smart Cat
May 13, 2022