Introduction
In today’s busy world, we are constantly bombarded with ads and recommendations that don’t really speak to us. As a result, many of us feel overlooked and unappreciated as customers. With the rapid growth of AI technology, the need for personalized experiences has become more important than ever. Mark Abraham, an expert in the field, explains what true personalization looks like and how businesses can make it work.
What is True Personalization?
True personalization is more than just suggesting a product based on something we’ve clicked on. It’s about learning from each interaction and making the next one better. Abraham explains that brands should take what they learn from one interaction and use it to create a more tailored experience for the next. When done right, this approach makes customers feel understood and builds lasting loyalty.
However, measuring personalization can be tricky. To solve this, Abraham’s team created a “personalization index,” a tool that scores companies from 0 to 100 on how well they personalize customer experiences. This index has helped businesses across different industries see how they are doing.
The Results of the Personalization Index
Some companies scored very high on the index. Netflix, for example, is known for its personalized movie recommendations, and Starbucks offers tailored drink promotions through its app. But it’s not just the big players. Smaller companies like SonderMind, a mental health app, also scored well for matching users with therapists based on detailed assessments.
On the other hand, industries like financial services, insurance, and healthcare lag behind in personalization. Abraham’s research shows that companies leading in personalization grow faster, and their customers are more satisfied and loyal. These leaders could see a potential growth of two trillion dollars in the next five years, simply by focusing on personalization.
Less is More
Surprisingly, one key finding from Abraham’s research is that sometimes, less is more. Sending fewer, but more relevant, ads and messages builds trust with customers. This strategy shows respect for their time and attention. Fidelity, a financial services company, is a great example of this. Instead of flooding clients with generic emails, they take the time to learn about their clients’ goals and send only relevant communication, improving engagement and satisfaction.
Personalization in Practice: Fidelity’s Example
Fidelity’s approach to personalization involves two steps: first, understanding their clients, and second, using that knowledge to create meaningful interactions. They collect data through personalized surveys, such as asking what clients are grateful for, and then use this information to offer tailored suggestions. For example, if a client has just had a baby and updates their life insurance beneficiaries, Fidelity might offer advice on starting a college savings account. This personalized approach boosts both customer satisfaction and transaction rates.
The Role of AI in Personalization
As AI generates more content than ever before, businesses must ensure they are not overwhelming customers with irrelevant information. AI can help brands create vast amounts of content quickly and at a lower cost, but this can be a double-edged sword. The risk of overloading consumers with content makes effective personalization even more crucial.
Abraham stresses that when brands truly invest in personalization, customers are more likely to share their data. If people feel respected and understood by a company, the percentage of customers willing to share their personal data can jump from 30% to 90%. This data helps brands further improve their personalization efforts, creating a win-win situation.
The Power Is in Our Hands
As customers, we also play a role in pushing for better personalization. It’s important to give feedback and, when necessary, walk away from brands that don’t respect our time and preferences. Companies are paying more attention to customer sentiment, and our feedback helps them improve.
Rebuilding Personal Connections
Abraham points out that, historically, businesses were much more personal. Local shop owners knew their customers by name and understood their needs. With the rise of big companies and digital ads, we’ve lost some of that personal connection. It’s time for both businesses and consumers to work together to bring back that personal touch.
In conclusion, AI offers a huge opportunity for brands to improve customer experiences through true personalization. By focusing on understanding and tailoring their services, companies can grow while building stronger, more personal relationships with their customers. It’s time to expect better, more personalized experiences and to reintroduce that personal touch to the way we do business.