Mindtree’s newest global study, “Winning in the Age of Personalization,” reveals that while the vast majority of consumers say that personalization initiatives cause them to spend more – including on products they have never bought before – companies across the retail, entertainment, banking and travel industries appear to be under-investing in this key area of digital development.
In a survey of 6000 global consumers and 900 industry decision-makers, customers indicated that customized promotions encourage them to buy products and services they have purchased before (78%), as well as relevant products and services they have never purchased (74%). However, only 28% of the decision makers surveyed say their organizations are investing significantly in personalization to improve the online purchasing experience, even though 58% of them say that more targeted promotions are the key driver of improved online sales over the past 12 months.
The survey also revealed that consumers expect their use of mobile apps as a primary channel for shopping to double in the next three years, from 6% in 2015 to 15% in 2018. This represents a huge opportunity for consumer-facing companies, and one that ties in perfectly to personalization initiatives, given the one-on-one relationship that mobile apps provide.
There were many other interesting facts that came out of the large survey, an overview of which can be found in the infographic and detailed report found on the study’s website. But the opportunity that lies in re-focusing investments toward personalization initiatives is the biggest take-home message in our view.
Many of today’s personalization approaches are ineffective due to being based on a slioed view of consumers. To get a more enriched view of their customers, companies may need to regroup and follow specific steps before embarking on an advanced personalization initiative:
This will only work if a company has the right digital underpinnings at the broadest level, blending four cornerstones that are crucial to achieving true digital transformation and success: Creating digital customer experiences, Digitizing the value chain across the front and back end, Developing “sense-and-respond” systems, and Shaping new, innovative business models and partnerships.
More specifically, companies need to think about how to deliver personalization to customers across the entire purchasing journey. We’ve developed a four-part framework – detailed in our eBook, “Get Personal to Make Digital Real” – necessary for to make this solution work:
Implicit in all of this is that companies need to focus on serving their customers just as well as they sell to them. The good news is that the survey also reveals that companies are ready. When asked whether they consider themselves to be “pioneers” in adopting or investing in digital technologies, 58% said yes. Knowing that a majority are already in transformation mode is a great start.