Today our teammates at Segment published their second yearbook Personalization status surveywhich marked a turning point for businesses and consumers alike.
Last year, the COVID-19 pandemic resulted in a dramatic shift towards digital channels and quickly increased customer expectations.
Personalized customer loyalty is the foundation for businesses today – and everyone is trying to meet the standard of powerhouses like Amazon and Netflix.
Which led us to the question: How do companies adapt?
Twilio Segment surveyed over 3,000 companies, consumers and marketers worldwide to understand changing attitudes and expectations about personalization. It’s a deep dive into how consumer behavior has evolved over the past twelve months and how companies have reacted to it.
The Personalization Gap: Expectations vs. Reality
In 2020 there was a mass migration to digital channels. Hundreds of millions of consumers began interacting with businesses primarily online, expecting brands to understand who they are and what they like no matter what channel they use.
And companies struggled to meet these new expectations. According to our survey, many are still lagging significantly behind when it comes to personalization, even as they continue to double the digital transformation.
While 85% of businesses believe they offer personalized experiences, only 60% of consumers seem to think they do.
Some companies benefit, others fall behind
The pandemic has condensed the e-commerce growth of a decade into a few months – and marked a permanent shift to online channels.
And one thing is clear: if you do personalization right, you benefit from customer loyalty.
More than half (60%) of consumers say they are likely to become repeat shoppers after a personalized shopping experience at a retailer, up from 44% in 2017.
In fact, over a third of consumers said they would return to a brand that offered a personalized experience. even if there were cheaper or more convenient options elsewhere.
Omnichannel is overlooked
Covid-induced trends (like roadside pickup, telemedicine, etc.) caused people to switch between devices and channels like never before. This resulted in customer data being fragmented across dozens (and even hundreds) of different systems across an organization.
In our survey, isolated data was one of the biggest challenges companies listed. L.Less than 1 in 4 companies have the technology to deliver consistent, personalized experiences across all channels – Show a blind spot when it comes to omnichannel customer experiences.
Personalization and privacy are not mutually exclusive
Privacy regulations are rapidly evolving, sparking a global debate about data integrity. Although third-party cookies have been used for years to track users and serve personalized ads, they have caused a decline in consumer confidence (as browsers gradually expire them).
As a result, first-party data has proven to be the better alternative (debunking this idea of a “personalization-privacy paradox”). Consumers know that data is necessary for personalization but want more transparency about how it is collected and used.
In fact, 69% of consumers said they appreciate the personalization as long as they have shared data directly with this company.
The state of personalization addresses an important point: Today is today for companies personalize or go under. To delve deeper into these trends and insights, be sure to check out the full report here.