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July 24, 2015

Why The Best Retailers Use 'Micro-Personalization'

Posted by Ambeshwar Nath (View Profile | View All Posts) at 10:19 AM

Retail Trends - Personalization & Big Data [Source: https://www.youtube.com/watch?v=cdv7XypdtwA]

One of the things that made the television series Mad Men so endearing was how quaint and simple the corporate world used to be a half-century ago. The popular television series shed light on Madison Avenue of the early 1960s. The world's largest advertising firms were run by brash, creative men who had little use for predictive analytics or customer relationship management (CRM) software.

Of course, no such technology existed back then. The series takes place more than 50 years ago, when the most sophisticated computers took up an entire room and operated on punch cards. Back then, customers were told what to covet by bold advertising campaigns. The idea was that a catchy jingle or repeating the name of a product over and over again over the airwaves would settle deep within a consumer's inner consciousness. The next time they went to the store they would inevitably buy that product.

It's hard for us to imagine that world. Today, as consumers, we're in charge. Companies learn from us through sophisticated software platforms and the slicing and dicing of zillions of data to find out what they should be selling us. The advertisements you see in the margins of your screen as you surf the web are there because of significant analytics that are consistently being run on your web footprints.

Today's retail environment is so sophisticated and advanced that the 'Mad Men' of the early 1960s wouldn't last a day in today's advertising industry. What the big firms want are computer programmers and data scientists to make sense of all the information that's pouring into their companies. Why? Because advertising has entered a new era. Today companies are focused on one-to-one marketing - something unheard of up until a few years ago because the technology simply didn't exist.

Just a few decades ago, the reaction would have been to hammer the potential customer with as many advertisements as possible. Repeat and repeat and repeat until they submitted to the mass messaging. Today, however,the smartest companies use micro-personalization. They know how to place an intelligent, customized offer in front of the customer. These enterprises are the ones that will be successful in today's super-saturated and competitive retail market.

Marketers now enjoy a 360-degree view of the consumer with a combination of mobile, in-store, and digital experiences. Retailers or CPGs are creating focused and intense one-to-one campaigns. They are engaging with the consumers and building bonds across all channels. A Procter & Gamble or a Unilever might know you down to the type of soap you prefer. They will send you targeted advertisements with special coupons to your mobile device...while you're in the store and near the soap aisle! Amazon, the biggest online retailer in the world, has filed a patent for a shipping system designed to cut delivery times by predicting what buyers are going to buy before they buy it -- and shipping products in their general direction, or even right to their door, before the sales click even falls!

It shows just how important IT has become in the new retail world. Retailers can now make specific offers to people, based on their profiles and patterns that they have unwittingly built up by using their digital devices. It's micro-personalization at its most effective. Marketing and IT need to work closely together as IT becomes more strategic and pervasive in the consumer journey. IT needs to be a strategic differentiator. And innovation is key. A company needs to invest in the right IT to get new customers and retain their existing ones. If your company hasn't invested in the right IT, your campaigns might be doing a big favor for your competitors.

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