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July 13, 2012

Keep your phone number. I'll take your genome instead

Posted by Sudhir Holla (View Profile | View All Posts) at 5:50 AM

It's hard to spot a business, brand or service that doesn't say the "P" word. Really speaking, claims of extreme personalization still belong in the realm of wishful thinking. And will continue to do so unless businesses find a way to understand each customer uniquely. Now, that may be more possible than it sounds, thanks to the notion of a "consumer genome", which like its biological inspiration provides definitive identification of its owner. Basically, the consumer genome is a set of intrinsic characteristics - immediate need, interest, buying behavior, connections, influence and demographics - which combine uniquely to determine consumer behavior. The same principle applies to other entities - for instance, every retailer has a "retailer genome".

Using the right platform, retail businesses  can decode the consumer genome to create a "map" of not just groups of near-identical ones but the "genetic construction" of individual consumers. So, a consumer who is also an athlete would have a genome that likely reads:  needs running shoes right now - loves cross-country running - makes highly involved, repeat buys of sporting and fitness goods - consults other sportsmen while taking major decisions. Is young, single, and favours heath food joints. A scotch drinker. Avoids beers and wines. Frequents a specialized training facility a mile from his residence.

Retailers can also do the same for their own genomes, which are built on characteristics such as distribution channel, product suite, promotional offer, and so on. Now, all that remains is to superimpose the two in real time to arrive at a great, highly personalized offer for the customer, which is relevant right here and right now. (Which means, not proposing that he pick up a pair of ordinary gym shoes before stocks run out!) 

The remarkable thing is that technology is also being leveraged to make all of this work in the real world - where complete information is rarely available, and never in one place.  So, next-gen platforms apply intelligence and accumulated knowledge (just like marketers do, only the platform is more efficient) to intuitively fill in the gaps to create a likely approximation of the genome. This knowledge comprises both what is fed in by users, as well as all that's out there in the public social space. So, if our cross country runner's favorite store has only got his name, age and address in its database, the platform, upon hearing his conversations in a Facebook forum, will advise the store of his hobby. Before the next big race, guess who will approach him with an offer for running gear?

In this case, the platform got lucky. But if it hadn't found significant activity in social media, it would have done the next best thing, which is, create a "most likely" genome based on what it knows of other customers with similar characteristics, to enable the retailer make educated overtures. 
From here on, "n=1" personalization is only a little step away!


Sudhir, great insights.

I truly believe that companies have a long way to go in delivering the promised efficiencies of the internet. Companies like Orbitz are barely scratching the surface when using user meta data to customize prices being offered to each user. With the recent advancements in Cloud and Big Data technologies, retailers can do much better than this to personalize and tailor users' experience - in-store, online, and on-the-go.

Good one.

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