Jonathan Cotton explores how data is powering more personalised customer experiences.
Data, with its certitude, measurability, unvarnished truths. Design, with its strategic approach, laser focus on the end user, and creative leaps. When the two come together, it’s a potent combination.
It’s an information age and as we continue to unlock new sources of digital insight, designers and brand marketers are finding myriad ways to cultivate, curate and leverage this information to provide ever better personalised customer experiences. So how does this personalisation imperative play out in our communications, products and services? What’s still to do? And where will it lead?
I spoke to some of New Zealand’s leading design, digital and data people to find out what’s behind the subtle art – and hard science – of turning ones and zeros into wonderful CX.
It’s all about you
Welcome to the age of personalisation. You see it everywhere, and even when you don’t, it’s still there. It’s the perfect movie suggestion that kicks off Friday’s Netflix binge. It’s the EDM addressed to you by name and filled with things you’re already thinking about buying. It’s the direct message at the right time and the right place that cuts through the noise. It’s the timely offer that bridges the sea of consumer choice.
Personalisation can imbue a customer experience, or product, with meaning and emotion, and create powerful attachments. From the Amazon homepage pre-populated with all your favourites, to the Reader’s Digest sweepstakes letter addressed to you specifically, marketers have long known about the power of personalisation in producing more valuable customer interactions.
In 2014, the Rethinking Retail report, released by Infosys, found that 86 percent of consumers said personalisation influenced their decision to purchase, with 25 percent saying that the influence was ‘significant’.
In 2019, McKinsey announced the approaching personalisation age, with advances in technology, data and analytics empowering marketers to create more personal and ‘human’ experiences across moments, channels and buying stages than we’ve ever seen.
Historically, the drive towards personalisation has been bound by the technology of the day, but that was then and this is now. We live in the age of information – about 2.5 quintillion data bytes created daily, at last count. Whether we’ve noticed or not, the collection, analysis and use of this data – in all its myriad forms – has ushered in a new era of personalisation. Suffice to say, we’re still figuring out what to do with it.
The customer is speaking
First-, second-, third-party data and the interactions between – it’s this information that’s the raw material for better, more intimate, long-lasting and lucrative relationships with customers. “An insight can provide the provocation that ignites the work, inspires the thinking and give creatives a real tangible datapoint to leverage,”
says Managing Director at Twenty CX Simon Breed.
“It’s the feedback loop in how people are acting. What it reveals, therefore, is the patterns of that behaviour. It tells you what’s happening; it tells you who it’s happening to; it tells you where it’s happening; it defines how much is involved in that process – such as products sales, etc. But it never tells you why that stuff is happening in its own right.”
It’s the job of the designer – or anyone tasked with strategically designing a customer experience or creative outcome – to interpret the nuances of that behaviour and wheedle the insights out of that
“Ultimately, a great design experience may require an emotional leap of faith – a eureka moment,” says Simon. “The data shows you patterns that are needed to make the emotional leap, but it doesn’t tell you what the leap is. You still need that human element of creativity.”
If meeting the multi-channel market with personalised, creative, emotive, individualised communications is the end goal, what’s the first step? The customer is speaking. If only we have the ears to hear.
Every business has some sort of customer data; what data’s on hand depends on who you are. Service-based companies like banks and telcos capture first-party data on customers every time they interact with a brand, accumulating information on what products and services are being used and by whom, what channels customers are engaging through, helpdesk requests and more. For the retail industry, collecting tangible first-person data has historically been a trickier prospect – hence the proliferation of loyalty programmes throughout the sector. Special deals, discounts and VIP treatment – it’s all there to get the data flowing in order to better understand customers and their behaviour.
In 2021, it’s increasingly external, or third-party, data sets that are being leveraged for better customer insight. This data, collected and curated by governments, the commercial sector and other institutions (think property values, census and other statistical data, for example), along with other websites and digital platforms, can contextualise a user experience in a bigger environmental picture.
“Data helps you zoom out to see broad patterns of behaviour,” says Head of Strategy at True Ruth Blair. “Although it’s still a poor proxy for true human insight, it’s useful in shifting a marketer’s focus to see something their own biases may have led them to ignore.”
But results may vary, she warns, and what you get out depends very much on what you put in. “Data behaves differently in the hands of different marketers. Good marketers use data to make the work better – more creative, exciting, brave and confident. The average ones use it to justify staying in the middle, keeping their heads down. And the bad ones are using it to suppress fresh thinking and play it safe.
“In that way, data is innocuous. It’s neither good nor bad –it’s what you do with it. But in the hands of people who value creativity, who understand deeply what makes human beings tick and who are interested in uncovering the truth, data is an amazing thing.”
And lucrative. For those who can get it right, the opportunities are limitless.
Suggestion as a Service
When it comes to deep personalisation, Spotify is at the cutting edge. How does the streaming giant do such a good job of understanding its audience one-to-one?
Here’s the answer: Spotify registers half a trillion events every day, including searches, listens, likes and countless other actions. It’s those data points that are used to guide its machine learning system and
drive its personalisation engine.
Spotify has turned personalised music curation into an empire, and continues to double down on its personalisation strategy, releasing a slew of new personalised playlist features this year and recently launching its Only You hub, an in-app experience that creates personalised playlists and compares your listening habits to that of the greater Spotify user base.
“There isn’t just one Spotify experience,” says Spotify’s Chief Research & Development Officer Gustav Söderström. “There are actually more like 345 million different Spotify experiences.”
But there’s also a growing body of research that highlights the connection between emotion and consumer behaviour, and Spotify takes its ability to segment and categorise both audiences and content seriously. Last year, the company published its own study investigating the link between personality traits and music listening behaviour, which is described via an extensive set of 211 mood, genre, demographic and behavioural metrics.
The same goes for differentiating individual customers from the collective. Back in 2018, Spotify filed a patent application for new technology that could analyse the human voice and detect the “emotional state, gender, age or accent” of the speaker. In January, that patent was granted. For Spotify, the connection between human emotion and its product is a clear one.
Personalisation = Emotion
The ‘personal touch’ appeals to complex human emotional needs. It also drives engagement and keeps punters coming back. When coupled with a clear understanding of a consumer’s genuine pain points, new technology can create better business models focused on creating highly satisfying emotional customer experiences.
Take Air New Zealand’s ‘Airbands’ product. Cognisant of the anxiety parents and guardians often feel when their children are flying unaccompanied, Air New Zealand developed ‘smart’ wristbands that could be scanned at various moments of the child’s journey. When the child is checked in to the flight and boards the plane, when the flight lands, and when the child has been collected by a designated person, text updates are sent to parents and guardians letting them know all is well and the child in safety on track.
There’s power in meeting that emotional need. Over the 2020/2021 holiday break, approximately 10,000 children travelled with the carrier unaccompanied – a new record for the airline.
Data & heart
As marketers look to unlock new, intimate moments in the customer journey, someone has to translate the raw data into something ‘human’. From a design perspective, is the personalisation imperative all about making creatives – sensitive and unpredictable as they can be – think about numbers?
Not at all, says Head of Insight & Analytics at Track Aotearoa Matt Jarman. “A statistic or provocation can ignite the work, ignite the thinking and give creatives a real tangible datapoint to leverage. That’s often what motivates creatives and gets them really excited.”
What that datapoint is could be anything – a social media post, user feedback or competitive intelligence. “We’re not talking about ‘average age is this’ and ‘number of kids’,” says Matt.
“That’s interesting contextual stuff, but the real question is: are there data points or statistics or pieces of insight that makes the creatives go, ‘Actually, that’s interesting, that gives us a hook and a good jumping off point’.
“The role of data is almost the raw material that fuels the work we do. It could be that initial jumping off point, it could be the heart of the work, where you’re trying to capture more information from
the consumer so you can better understand them from a comms perspective, or it could be used almost as an overlay, so that different groups see things in slightly different ways.”
Case in point: Track Aoteora’s work with Westpac on its ‘First 100 Days’ initiative. First impressions matter,
but journey mapping had revealed inconsistent experiences across the bank’s new sign-up customers.
With regulatory demands and legacy systems failing to nurture new customers, a new onboarding strategy focused on better understanding the individual customers’ needs was recommended.
Using customer data insights to personalise the work and inform the creative, Track Aotearoa radically redesigned WestPac’s onboarding process, centring it around customer experience during their first three months. Westpac’s new multi-channel contact onboarding solution recognises each action a new sign-up takes and provides new users with exactly what they need, when they need it, including personalised checklists, next-step prompts, personalised support and more. The results: a significant (38 precent) reduction in churn, increases in customer satisfaction feedback and improvements in additional customer needs being met.
Right place, right time
From streaming platforms to financial services, the right communication at the right time is a powerful tool. “When someone’s in that buying mindset at the sharp end of a transaction, their mind and their wallet
is open,” says Commercial Director at Rokt Andrew Evans.“If you can present the right opportunity for that individual customer, as opposed to a one-size-fits-all approach, you can increase attachment rate, increase engagement and increase profit.”
Using its customer data platform, user journey data and machine learning, Rokt leverages post-purchase ‘thank-you’ pages to show personalised third party offers and promotions. Personalisation is powered by more than 50 data points that are available in real time during the transaction, including age, gender, location, purchase value, product selection, device and more.
But it’s about more than just “picking an advertiser offer and throwing it at the user,” says Andrew. “It’s the design of the placement, it’s the wording of the copy that’s used, it’s the imagery. Using machine learning, we piece together what’s going to have the best chance of engagement and the best chance of adding value to that customer.”
Buying a ticket to a show? The Rokt platform aims to offer the most relevant next best action possible. How about pre-booking parking just down the street from the gig? With sufficient relevance and timing, the possibilities are endless.
“It comes down to consumer behaviour, an individual’s engagement with a certain offer over another, across millions of individual customers, allowing us to create those personalised journeys,” says Andrew.
Some of these offers are overt, some are subtle, and even small changes can produce big results. “The switching of the order of some buttons for an individual, or the colourway, or the font, or the imagery, or one word in the copy – any one of those things can massively change the engagement and adoption of a next action for a consumer,” says Andrew. “Being able to do that in real time and not just making a decision for your whole customer base – that’s where true incremental value can be unlocked.”
Challenging the data
With personalisation the order of the day, is ‘data’ in all its forms therefore the cure-all for connecting with customers? Not quite.
“We all have our biases and false assumptions, so good data keeps you honest, but you’ll only get good data by asking the right questions,” says Managing Director at EightyOne Matt West. “From a pure design perspective, it’s quite a unique skill to have – seeing another dimension of possibilities beyond traditional visual and verbal. It can be another highly effective weapon in the armoury of building empathy with the audience. In that light, data should be empowering, rather than restricting, because it’s usually smashing the available data together from different angles that leads to an unexpected insight that reframes the problem and unlocks a more unique solution.”
Paradoxically, that might be getting harder now, he says. Simply put, with the number of data sources available, there’s a drowning risk.
“The real value in data is simplicity – seeing where the good data is for the problem at hand and eliminating the rest. And that value will only increase as the tidal wave of available data gets bigger and bigger.”
Being able to pick good data from bad, glean genuine insight from it and actually using it in a unique way that connects with people? That’s something more than art or science, says Planning Director at Proximity New Zealand Kate De Marco. “Intelligence and creativity coming together is where the magic lies – that’s where you can create an experience that really connects with people.”
She says the market still has a way to go. “Too many businesses are still using data to purely serve their business needs. They’re asking, ‘How do we sell more?’, ‘Who can we sell more to?’. The question needs to become ‘What do our customers need?’”
It’s time to change our thinking, she says.“If you can successfully make that switch in mindset, it makes you look at the data in a totally different way. It makes you realise that if you really understand the customer’s needs through the data, you’ll naturally sell more. If you’re solving their problems, they’ll come to you and you’ll retain them.
“If you look at the data by itself, it appears factual and rational, but we know people aren’t factual and rational. They’re emotional and driven by a lot of different influencing factors. Combining those things together – humanising the data – that’s what’s really important.”