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Personalization as driving belt for digital transformation? A reality check.

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Personalization as driving belt for digital transformation? A reality check.

  1. 1. 5th RICHMOND MARKETING FORUM 5th RICHMOND MARKETING FORUM GRAND RESORT BAD RAGAZ 29TH JUNE – 1ST JULY 2017
  2. 2. 5th RICHMOND MARKETING FORUM PERSONALIZATION AS DRIVING BELT FOR DIGITAL TRANSFORMATION? A Reality Check. Dr. Thomas Walter Senior Principal Consultant, Namics AG
  3. 3. 5th RICHMOND MARKETING FORUM PERSONALIZATION AS DRIVING BELT FOR DIGITAL TRANSFORMATION? A Reality Check. Dr. Thomas Walter Senior Principal Consultant, Namics AG
  4. 4. 5th RICHMOND MARKETING FORUM Your symptoms come with googling. stomach  pain  a,er  ea/ng  
  5. 5. 5th RICHMOND MARKETING FORUM Googling for „personalization in marketing“ will lead you towards „information“ like the following:
  6. 6. 5th RICHMOND MARKETING FORUM The challenge lies in filtering “signals from noise”.
  7. 7. 5th RICHMOND MARKETING FORUM Let’s  have  a  closer  look     on  what  is  happening  on     the  market  right  now.  
  8. 8. 5th RICHMOND MARKETING FORUM
  9. 9. 5th RICHMOND MARKETING FORUM My Perception. Personalization is like teenage sex.   –  Everyone  talks  about  it.     –  Nobody  really  knows  how  to  do  it.     –  Everyone  thinks  everyone  else  is  doing  it.       –  So  everyone  claims  they  are  doing  it.1    
  10. 10. 5th RICHMOND MARKETING FORUM Contrary, you are ... –  In  marke/ng  for  some  years.     –  Decision  makers  with  own  budgets.   –  Reluctant  to  hear  yet  another  sales  presenta/on.     –  Used  to  sweet-­‐talk  of  providers,  so,ware  companies,  agencies,  etc.   –  Aware  of  panic-­‐mongering  studies  that  ‘proof’  that  you  definitely   have  to  invest  know.   –  S/ll  curious  what  is  really  behind  the  issue  of  ‘personaliza/on’  and   the  if,  the  why  and  the  how  you  should  tackle  it.  
  11. 11. 5th RICHMOND MARKETING FORUM 04.07.17   Hence, it‘s time to take a step back, and do a reality check.
  12. 12. 5th RICHMOND MARKETING FORUM MARKETING   REALITY    
  13. 13. 5th RICHMOND MARKETING FORUM Conferences   Mee5ngs   Keynotes  Reports   TYPICAL   SCENARIOS  
  14. 14. 5th RICHMOND MARKETING FORUM Mee5ngs   Keynotes  Reports   “Personaliza5on  is  about   the  ‘segment  of  one’,  a   totally  individual  offering  to   each  client.”   TYPICAL   SCENARIOS  
  15. 15. 5th RICHMOND MARKETING FORUM Reality Check (1/4). Myth     “Personaliza/on  is  about  the   ‘segment  of  one’,  a  totally  individual   offering  to  each  client.”   Reality     ?  
  16. 16. 5th RICHMOND MARKETING FORUM Basic idea: Good personalization does the job of a client advisor. Understanding  the  context:   1)  Our  new  showroom   2)  They  checked  out  model  i5   3)  We  close  in  20  min   Understanding  the  segment:   4)  male,  30-­‐35,  European   5)  cloths/  style  speak  of  wealth   6,  7)  a  couple,  but  not  married   Knowing  the  customer:     8)  His  Name  is  Thomas,  he  lives   nearby  and  he  bought  an  Z3  only   two  years  ago.       5   7   4   6   3   2   1   8  
  17. 17. 5th RICHMOND MARKETING FORUM The challenge: Finding a sweet spot for the amount of personalization somewhere between 1:n and 1:1. 2)  But  if  “1:1“  means  managing  and  producing   individual  experiences  for  every  customer,  our  costs   in  marke/ng  would  explode.  Then  again,  there  is  no   u/lity  for  us.   1)  A  watering-­‐can  approach  is  no  longer  accepted  by   the  customer.  Hence,  any  ini/al  invest  in   personaliza/on  will  take  us  away  from  1:n  and   hence,  gain  our  u/lity  for  marke/ng.   3)  A  sweet  spot  of  personaliza/on  the  amount  where   you  get  the  most  u/liza/on  for  your  marke/ng,  a   point  where  marginal  gains  reach  zero.   *  let’s  say  X  =  personaliza/on   2  1   3  
  18. 18. 5th RICHMOND MARKETING FORUM Example: The sweet spot for the car salesman/ client advisor might be, to consider 4 segments. Configure your convertible now! Website Test-drive this limousine around your neighborhood Website Test-drive your recently configured i5 model now! Website These suplements for your Q5 help to avoid winter-risks. Website Segment: «fun-Lover» Segment: «comfort lover» Segment: «converted: model configured» Segment: «connected: model purchased»
  19. 19. 5th RICHMOND MARKETING FORUM Case Study: Pathê. Create the personalized cinema experience!  
  20. 20. 5th RICHMOND MARKETING FORUM From insight to action. First step: Deepening our understanding about the customer. Exemplary  user  journeys  of  cinema  visitors  based  on   mul5ple  qualita5ve  interviews     (32  interviews  a  45’  conducted).       First  insights  (exemplary):     •  The  unique  atmosphere  of  the  cinema  is  central  to  the  overall   cinema  experience.   •  The  cinema  experience  is  a  shared  experience.   •  …     Derived  hypothesis  (exemplary):     •  The  customer  journey  is  determined  by  the  context  of  the  visit.   Therefore,  the  context  is  essen/al  for  segmenta/on.   •  …       INSPIRATION & CONSIDERATION EVALUATION CONFIGURATION & PRIMARY TRANSACTION PREPARATION & SECONDARY TRANSACTION MOVIE EXPERIENCE BONDING & ADVOCACY ACTUAL USER JOURNEY OPTIMAL USER JOURNEY ACTUAL VS. OPTIMAL USER JOURNEYUSER JOURNEY - EXPERIENCE SHARER Movie Phase 1 4 3 External trigger (e.g. radio movie evaluation, TV ad or friends talking about a particular film) 6 Tickets Arrival at the theater Pathé.ch is checked - watch the movie 2 - visits Pathe.ch on mobile - goes straight to Pathé Dietlikon Programm page Find fitting time, place and movie -Alignment with family and friend(s) using Whatsapp - buy tickets at the counter Contextual Activities5 Acitivties afterwards no movie found no interesting things to share Concessions are purchased has a seat with a person in front of him weather is good - buy tickets online and print them at home In the mood to go out with friends (going to the cinema is a lead option) Google Research - remembers several movie names - checks further information about the movie on Google (focuses on results appearing first) - interested in ratings and pictures - checks Pathé webpage again for movie schedule Weather is bad - goes to Pathe.ch directly for movie schedules as it is his favorite cinema Checks Pathé.ch Tickets3 - go for food close to the theater - go shopping - go for drinks - buys popcorn and a drink 7 8 no convenient time, place or movie are being found F-08 Group recommendations - Movie recommendations for groups based on their profiles (preferred movies, directors or actors) F-12 Date, place and movie alignment - Integration of Whatsapp: Export text and links to Whatsapp - Finder-functionality (e.g. Doodle) on website - Organisator gets reward F-07 Groups - Adding friends to the profile - Invite friends to the website - Group promotions Movie Phase 1 4 3 7Tickets Arrival at the theater Pathé.ch - watch the movie 2 - goes straight to the movie overview page Find fitting movie, time and place - Alignment with family and friend(s) using Whatsapp - buy tickets at the counter or vending machine Acitivties afterwards - enjoy the theater atmosphere - sharing the theater visit on Social Media - talk about the movie with group/friends/co-workers - further activities with group (e.g. go clubbing) Concessions are purchased - buy tickets online In the mood to go out with friends (going to the cinema is a lead option) Tickets5 8 9 Contextual Activities 6 - go for food close to the theater - go shopping - go for drinks - sharing the theater visit on Social Media F-14 Share Ticket - Share tickets and reservations with friends/groups using Mail or SMS F-15 Split the bill - Paymit integration F-17 Movie rating - Push notification (Whatsapp, Mail, SMS): Step 1: How did you enjoy the movie? Step 2: Whats next External Research - Cineman, Google - Checks further information about the movie (trailers, plot, rating etc.) - forwarded directly to the respective movie detail page Pathé.ch Weather is bad F-16 Share activities - Branded photo-corner with speech bubbles, movie utilities or movie characters Option A: Selfie-stick/Pathé employee Option B: Photobox - Gifarator - enjoy the theater atmosphere - sharing the theater visit on Social Media - talk about the movie with group/friends/co-workers - further activities with group (e.g. go clubbing) F-13 Free view - Possibility to temporarely reserve the seat in front of you as well (until the auditoria is booked to a certain point) F-01 Newsletter - Weather (rainy or hot) or season based - Time based special offers - Loyality program F-04 Drive to online - Incentives through loyality program and promotions F-04 Drive to online - In case of line suggest to use the online channel INSPIRATION & CONSIDERATION EVALUATION CONFIGURATION & PRIMARY TRANSACTION PREPARATION & SECONDARY TRANSACTION MOVIE EXPERIENCE BONDING & ADVOCACY ACTUAL USER JOURNEY OPTIMAL USER JOURNEY ACTUAL VS. OPTIMAL USER JOURNEYUSER JOURNEY - EXPERIENCE SHARER Movie Phase 1 4 3 External trigger (e.g. radio movie evaluation, TV ad or friends talking about a particular film) 6 Tickets Arrival at the theater Pathé.ch is checked - watch the movie 2 - visits Pathe.ch on mobile - goes straight to Pathé Dietlikon Programm page Find fitting time, place and movie -Alignment with family and friend(s) using Whatsapp - buy tickets at the counter Contextual Activities5 Acitivties afterwards no movie found no interesting things to share Concessions are purchased has a seat with a person in front of him weather is good - buy tickets online and print them at home In the mood to go out with friends (going to the cinema is a lead option) Google Research - remembers several movie names - checks further information about the movie on Google (focuses on results appearing first) - interested in ratings and pictures - checks Pathé webpage again for movie schedule Weather is bad - goes to Pathe.ch directly for movie schedules as it is his favorite cinema Checks Pathé.ch Tickets3 - go for food close to the theater - go shopping - go for drinks - buys popcorn and a drink 7 8 no convenient time, place or movie are being found F-08 Group recommendations - Movie recommendations for groups based on their profiles (preferred movies, directors or actors) F-12 Date, place and movie alignment - Integration of Whatsapp: Export text and links to Whatsapp - Finder-functionality (e.g. Doodle) on website - Organisator gets reward F-07 Groups - Adding friends to the profile - Invite friends to the website - Group promotions Movie Phase 1 4 3 7Tickets Arrival at the theater Pathé.ch - watch the movie 2 - goes straight to the movie overview page Find fitting movie, time and place - Alignment with family and friend(s) using Whatsapp - buy tickets at the counter or vending machine Acitivties afterwards - enjoy the theater atmosphere - sharing the theater visit on Social Media - talk about the movie with group/friends/co-workers - further activities with group (e.g. go clubbing) Concessions are purchased - buy tickets online In the mood to go out with friends (going to the cinema is a lead option) Tickets5 8 9 Contextual Activities 6 - go for food close to the theater - go shopping - go for drinks - sharing the theater visit on Social Media F-14 Share Ticket - Share tickets and reservations with friends/groups using Mail or SMS F-15 Split the bill - Paymit integration F-17 Movie rating - Push notification (Whatsapp, Mail, SMS): Step 1: How did you enjoy the movie? Step 2: Whats next External Research - Cineman, Google - Checks further information about the movie (trailers, plot, rating etc.) - forwarded directly to the respective movie detail page Pathé.ch Weather is bad F-16 Share activities - Branded photo-corner with speech bubbles, movie utilities or movie characters Option A: Selfie-stick/Pathé employee Option B: Photobox - Gifarator - enjoy the theater atmosphere - sharing the theater visit on Social Media - talk about the movie with group/friends/co-workers - further activities with group (e.g. go clubbing) F-13 Free view - Possibility to temporarely reserve the seat in front of you as well (until the auditoria is booked to a certain point) F-01 Newsletter - Weather (rainy or hot) or season based - Time based special offers - Loyality program F-04 Drive to online - Incentives through loyality program and promotions F-04 Drive to online - In case of line suggest to use the online channel
  21. 21. 5th RICHMOND MARKETING FORUM Next: Testing our hypothesis reveals two essential factors why people actually go to the cinema. Movie Passion: „I go the cinema because movies are a passion of mine“ Average Visitor Count: „How many people accompany you to the cinema?“ Visit Frequency: „How often do you go to the movies?“ Experince Sharing: „I go to the cinema to spend time with others.“ Leisure Routine : „Cinema is part of my leisure routine“ Cherry Picking: „I prefer to watch certain movies at the cinema“ Atmosphere Affinity: „I go the cinema to enjoy the special atmosphere“ Source: Pathé Online Customer Survey 2015, n = 9980, CH-DE/CH-FR Movie&CinemaFocus   Social Focus   Based  on  mo/va/on  for  cinema  visit  (6  items),  visit  frequency  &  group  size.    
  22. 22. 5th RICHMOND MARKETING FORUM An additional cluster analysis allows us to define statistically relevant customer segments. Social Focus Movie  &   Cinema  Focus   Source: Pathé Online Customer Survey 2015, n = 9980, CH-DE/CH-FR SocExg.=  Social  Exchange  (“I  like  to  talk  with  others  about  movies  and  share  my  opinion”),     SocInfl.  =  Social  Influence  (“It  is  o,en  my  idea  when  I  go  to  the  cinema  with  others”) Movie Passionate 15 % SocExg.: 80 IDX SocInfl.: 91 IDX Social Movie Passionate 35 % SocExg.: 111 IDX SocInfl.: 122 IDX Experience Sharer 38 % SocExg.: 110 IDX SocInfl.: 108 IDX Cherry Picker 12 % SocExg.: 81 IDX SocInfl.: 87 IDX Social Focus Movie  &  Cinema  Focus  
  23. 23. 5th RICHMOND MARKETING FORUM Further analysis detects, that those segments correlate with customers locality. Social Focus Movie  &  Cinema  Focus   Movie Passionate 15 % Social Movie Passionate 35 % 38 % Cherry Picker 12 %* Source: Pathé Online Customer Survey 2015, n = 9980, CH-DE/CH-FR *High probability underrepresentation due to sample bias (Newsletter, Website, Social Media) Rather  located  in  the  german   speaking  parts  of  Switzerland   Rather  located  in  the  french   speaking  parts  of  Switzerland  
  24. 24. 5th RICHMOND MARKETING FORUM Personalization means: If customers are that different in requirements we need to personalize our offering. Exemplary  challenge:  How  do  people  want  to  select  a  movie,   pick  the  cinema,  the  date  and  the  /me,  …  ?   OPTIMAL USER JOURNEY F-08 Group recommendations - Movie recommendations for groups based on their profiles (preferred movies, directors or actors) F-12 Date, place and movie alignment - Integration of Whatsapp: Export text and links to Whatsapp - Finder-functionality (e.g. Doodle) on website - Organisator gets reward F-07 Groups - Adding friends to the profile - Invite friends to the website - Group promotions Movie Phase 1 4 3 7Tickets Arrival at the theater Pathé.ch - watch the movie 2 - goes straight to the movie overview page Find fitting movie, time and place - Alignment with family and friend(s) using Whatsapp - buy tickets at the counter or vending machine Acitivties afterwards - enjoy the theater atmosphere - sharing the theater visit on Social Media - talk about the movie with group/friends/co-workers - further activities with group (e.g. go clubbing) Concessions are purchased - buy tickets online In the mood to go out with friends (going to the cinema is a lead option) Tickets5 8 9 Contextual Activities 6 - go for food close to the theater - go shopping - go for drinks - sharing the theater visit on Social Media F-14 Share Ticket - Share tickets and reservations with friends/groups using Mail or SMS F-15 Split the bill - Paymit integration F-17 Movie rating - Push notification (Whatsapp, Mail, SMS): Step 1: How did you enjoy the movie? Step 2: Whats next External Research - Cineman, Google - Checks further information about the movie (trailers, plot, rating etc.) - forwarded directly to the respective movie detail page Pathé.ch Weather is bad F-16 Share activities - Branded photo-corner with speech bubbles, movie utilities or movie characters Option A: Selfie-stick/Pathé employee Option B: Photobox - Gifarator F-13 Free view - Possibility to temporarely reserve the seat in front of you as well (until the auditoria is booked to a certain point) F-01 Newsletter - Weather (rainy or hot) or season based - Time based special offers - Loyality program F-04 Drive to online - Incentives through loyality program and promotions F-04 Drive to online - In case of line suggest to use the online channel
  25. 25. 5th RICHMOND MARKETING FORUM Example: Personalized decision making process for the segment “Social Movie Passionates”.
  26. 26. 5th RICHMOND MARKETING FORUM Additionally, personalization means using the customers context. The  customer’s  allocated  segment  (like  “social  movie   passionates”)  can  be  defined  by  the  customer’s   loca/on  or  a  recently  selected  cinema.  Based  on  such   segment  a  feature  (like  the  movie-­‐sheduling)  might  be   more  visible  in  western  Switzerland  than  in  eastern.     Addi/onally,  the  move-­‐scheduling-­‐feature  adopts  the   customers  context,  defined  by  the  used  technology.   Hence,  the  feature  offers  to  use  Whatsapp  if  the   customer  uses  a  mobile  device  and  Doodle  if  the   customer  uses  a  laptop.  
  27. 27. 5th RICHMOND MARKETING FORUM Reality Check (1/4). Myth     “Personaliza/on  is  about  the  ‘segment  of   one’,  a  totally        individual  offering  to  each   client.”   Reality     -­‐  If  your  product  doesn’t  allow  1:1   personaliza/on,  the  idea  of  having  a   “segment  of  one”  is  a  myth  (e.g.  cinema,   car,  banking).   -­‐  Personaliza/on  o,en  works  best  on  the   basis  of  segments.   -­‐  Therefore  it  is  key  to  understand  you   customer’s  needs.   -­‐  Try  to  define  your  sweet  spot  between  1:n   and  1:1  and  start  crea/ng  personalized   experiences  for  each  segment.  
  28. 28. 5th RICHMOND MARKETING FORUM Keynotes  Reports   “Personaliza5on  is  about   the  ‘segment  of  one’,  a   totally  individual  offering  to   each  client.”   “Personaliza5on  is  about   the  ‘segment  of  one’,  a   totally  individual  offering  to   each  client.”   TYPICAL   SCENARIOS  
  29. 29. 5th RICHMOND MARKETING FORUM Reality Check (2/4). Myth     “Personaliza/on  is  too  complicated   for  us  and  we  ain’t  got  the   organiza/on  for  that.”   Reality     ?  
  30. 30. 5th RICHMOND MARKETING FORUM How complex is personalization and how do we start to personalize? We  suggest  to  consider  the  following  aspects  in  order  to  start  with  your   personaliza/on  project.     Business goal framework Data basis Customer segments Customer journeys1 2 3 4 Goals Sucess- Factors Digital Activities Performance Metrics Key Performance Indicators
  31. 31. 5th RICHMOND MARKETING FORUM Typical goals that are set for personalization endeavors. Fostering Online Sales Strengthening customer loyality Generating leads Becoming „Top of Mind“ Becomeing more efficient Knowing our customers
  32. 32. 5th RICHMOND MARKETING FORUM Essential step: Finding and defining your data sources that are the basis for personalization. Technical     Context     •  Device-­‐Type  (Tablet)   •  Device  (iPhone  6)   •  Browser  (Firefox)   •  Carrier  (Vodafone)   •  Connec/on  (3G)     Local       Context     •  Geo-­‐IP  (city    country)   •  GPS  (near  POS)   •  Wlan  (indoor)   •  Beacons  (indoor)   •  Weather  @user   Time     Context   •  Time    at  the  customer   •  Day  of  week  (Mo-­‐So)   •  Season  (holiday)   •  Visit  dura/on     •  Time  on  page     •  Avg.  /me/  page   Customer     Behavior   •  Referrals  as  Links,  URLs,   Campaign-­‐IDs,  Social   Plaqorm,  internal  Blog,   etc.   •  Likes,  clicks,  views,   Usage  of  services   (booking,  configurators,   etc.)   Customer     Loyality     •  Returning  (y/n)   •  Visit  #  (2.,5.,  etc.)   •  Involvement  (clicks)   •  #  pages/  session   •  Video  watched     •  Newsar/cle    liked   Defined  Customer   Segment   •  Private  customer   •  Corp.  Ins/t.  Clients   •  Young  Families   •  Moved  recently       •  Internal  user   •  Mult  service  user   CRM     Informa5on   •  Name  (Login)   •  E-­‐Mail   •  Company   •  Last  Contact   •  Slaes  history   •  Topic  interest     Market  specific   informa5on     •  Market  size  (#user)   •  Market  share  (%)     •  Opponents  (URLs)     •  Demographics  (age)   •  Historical  development     3rd  party  -­‐   Informa5on   •  External  Segment-­‐Info   from  3rd  party  cookies   •  Traits  like  „father,,  car   fana/c,  interested  in   funds,  reads  NYT,  Sport   lover,    ...“   Company  Specific   Informa5on   •  Point  of  Interest  (POI)   •  Opening  /mes   •  Client  advisors/    POI   •  PIM  (Product-­‐  Info)   •  PIM  (categories)   •  Discount  &  Promo/ons       Social  CRM   Informa5on     •  Topic  interests   •  Likes,  shares,  tweets   •  Social  Engagement   •  Social  Graph   •  Social  Rank   •  Family  situa/on     Unstructured     Data   •  Mails  (Text)   •  Comments  (Text)   •  Clicktale  and  browser   usage  (App  usage)   •  Feedback  (Text)  
  33. 33. 5th RICHMOND MARKETING FORUM Defining the output channels, spots where you want to offer and deliver personalization. Webseite/  Elements   •  Page  types  (Home,  spez.   Topic  Home,  About-­‐us-­‐ Page,  etc.)   •  Components  (Text/   Image,  Teaser   Download,  Contact-­‐Info,   etc.)   Custom  Web-­‐App   •  Search/  Input  field   •  Extended  search     •  Search  results  incl.   Images,  tables   •  Promo-­‐Teaser   •  Watchlists   •  Configurators   Customer  Portal   •  Login-­‐page   •  Home   •  Bookmarks   •  Navigator  Apps   •  Customer  center   •  Easyorder   •  Logout-­‐page   Newsleher/  Mail   •  Gree/ngs/  Welcome       •  Text/  Image   •  CTA  (Buvons)     •  Deeplinks  to  Pages   •  Avachements  (pdfs)   •  ...   Mobile  App     •  Search/  Input  field   •  Promo-­‐Teaser   •  Watchlists   •  Configurators   •  Push-­‐No/fica/ons   Mobile  Portal   •  Login-­‐Seite   •  Home   •  Push-­‐No/fica/ons   •  Bookmarks   •  Navigator  Apps   •  Customer  center   •  Logout-­‐page   Social  Media   •  Facebook   •  Twiver   •  Instagram   •  LinkedIn   •  Xing   •  etc.   Shop   •  Home   •  Product  finder   •  Teaser/  Promo   •  Basket/  checkout     •  Search  results   •  Register-­‐page   •  Logout-­‐page   Digital  Signage     •  Screen  (total)   •  Text/  Img   •  Welcome-­‐Message   •  Loca/on-­‐specific  device   •  Teaser   Company  Specific   Informa5on   •  Point  of  Interest  (POI)   •  Opening  /mes   •  Client  advisors/    POI   •  PIM  (Product-­‐  Info)   •  PIM  (categories)   •  Discount  &  Promo/ons      
  34. 34. 5th RICHMOND MARKETING FORUM Crossing data basis with output channels creates a nice playground for brainstorming. Let’s  consider  the   car-­‐selling  example:     How  might  we  make  the   customer  experience   more  personal  using  the   Hero  visual  teaser,  if  we   already  know  that  the   customer  is  within  the   “fun  seeking”  segment?   ?  
  35. 35. 5th RICHMOND MARKETING FORUM Personalization means creating more content and thinking about texts, images, videos, etc. in different shape, style or tonality. Element: Hero Visual on Home Text element & picture element Situa5on     Segment   Default   Journey     Stage  1   Journey     Stage  2   Journey     Stage  3   Default   Segment  1   Segment  2   Imagine  you  want  to  personalize  the  homepage  hero  visual  for  3  specific  segments  and  4  stages  within  a   defined  customer  journey:  Instead  of  1x  you’ll  now  need  to  create  12x  text  &  image.  
  36. 36. 5th RICHMOND MARKETING FORUM Typical counter-argumentation at that point: “Ok, but we do not have all that information to create those segments.” Simple trick: Enhance your data basis and ask. hvps://www.namics.com/project/swiss-­‐life-­‐themenfinder/  
  37. 37. 5th RICHMOND MARKETING FORUM Another one: “Ok, but it will take ages to implement and test all those personalized experiences, and we ain’t got people, time and money for that. Simple trick: Use the right tool.
  38. 38. 5th RICHMOND MARKETING FORUM Final one: “Ok, so who can do the job? My analytics guy or the SEO guy or the content guy or who? Consulting answer: It depends. Personaliza5on  (3)    
  39. 39. 5th RICHMOND MARKETING FORUM Reality Check (2/4). Myth     “Personaliza/on  is  too  complicated  for  us   and  we  ain’t  got  the  organiza/on  for  that.”     Reality     -­‐  Execu/ng  personaliza/on  is  not  too   complex,  but  it  takes  some  effort.   -­‐  We  suggest  to  start  with  following  your   business  goals  and  then  finding  the  best   possible  personalized  experiences   based  on  your  data   -­‐  Everyone  has  data,  no  user  is  really     anonymous  nowadays   -­‐  Create  a  central  role  within  the   marke/ng  department  and  also  invest   in  tool-­‐handling.  
  40. 40. 5th RICHMOND MARKETING FORUM Keynotes  Reports   “Personaliza5on  is  about   the  ‘segment  of  one’,  a   totally  individual  offering  to   each  client.”   “86  %  of  all  marketers  say   that  personaliza5on  is  the   key  to  more  sales.”   “Personaliza5on  is  too   complicated  for  us  and  we   ain’t  got  the  organiza5on   for  that.”     TYPICAL   SCENARIOS  
  41. 41. 5th RICHMOND MARKETING FORUM Reality Check (3/4) Myth     “86  %  of  all  marketers  say  that   personaliza/on  is  the  key  to  more   sales.”   Reality     ?  
  42. 42. 5th RICHMOND MARKETING FORUM Where do statements like that come from and do they even make sense? It  is  easy  to  create  a  link  between  a   personalized  offering  and  the  wishful   scenario  that  economists  call  perfect   price  discrimina5on.     Best  example:  A  bartender  offers  beer  based  on   a  customers  preferences  but  also  defines  the   prize  of  each  bovle  individually  based  on  age,   context  and  journey  stage,  e.g.  1st  beer:  CHF  10   as  a  customer  might  look  rich  and  thirsty   enough,  2nd  beer  CHF  7,  3rd  CHF  7  again  as  the   bartender  knows  that  the  customer  is  always   having  a  4th  one  for  that  price,  etc.  un/l  he   reaches  his  reserva/on  price.    
  43. 43. 5th RICHMOND MARKETING FORUM At best, personalization is aligned with the aims of price discrimination.
  44. 44. 5th RICHMOND MARKETING FORUM Basis argumentation: You will boost your conversion funnel due to a personalized offering. Multi-Funnel w/ personalized offerings Won Won Won Won Funnel w/ unpersonalized offering (1:n) Lost LostWon ?  
  45. 45. 5th RICHMOND MARKETING FORUM Case Study: Smart. Create the personalized car purchase decision.  
  46. 46. 5th RICHMOND MARKETING FORUM Basis for all ROI calculations. Understanding of the customer journey and the conversion funnel. Contacted dealer Product detail page Signing up purchase First visit to website Car configrator Saved configuration Test drive Customer Relationship Management Customer
  47. 47. 5th RICHMOND MARKETING FORUM Calculations are usually based on a standardized conversion funnel (reach to conversion). Funnel w/ unpersonalized offering (1:n) How  it  is  calculated:       Effect  and  costs  of  all  marke/ng   ac/vi/es  will  scale  by  the  basic  reach.     Example:  If  10.000  website  visitors   (reach,  R)  result  in  50    test-­‐drives   (conversion,  C),  then  the  conversion   rate  (cr)  is  0,5%.     Hence,  if  the  cr  remains  stable,   20.000  visitors  will  result  in  100  test-­‐ drives.   Conversion   Reach   R   C  
  48. 48. 5th RICHMOND MARKETING FORUM Our goal: Convert a passerby into signing-up for a test-drive (ultimate online conversion). Passerbys 1. Website visit Default Experience Wide target group message (suitable for multiple segments), default teaser.
  49. 49. 5th RICHMOND MARKETING FORUM Our goal: Convert a passerby into signing-up for a test-drive (ultimate online conversion). Explorers Configurator Default Experience Visitor saves configuration (stored in cookie, w/o login).
  50. 50. 5th RICHMOND MARKETING FORUM Our goal: Convert a passerby into signing-up for a test-drive (ultimate online conversion). Experience with personalized hero visual + test drive options highlighted Stage: Consider Involved Returning visit Personalized visual
  51. 51. 5th RICHMOND MARKETING FORUM Our goal: Convert a passerby sign up for a test- drive (ultimate online conversion). Location based dealer finder. Leads Händlersuche Geo-Targeting
  52. 52. 5th RICHMOND MARKETING FORUM Personalization calculated like process automation: Same reach, but higher conversion. How  it  is  calculated:     Personaliza/on  works  like  automa/on,   e.g.  prefilled  forms,  remembering  user   input,  etc.  based  on  known  data.     Addi/onal  costs  vs.  argumenta/on  for  a   higher  cr  (C  to  C’  for  the  same  reach  R).     Example:  If  10.000  website  visitors  (R)   result  in  50    test-­‐drives  (C)  for  default   visual,  but  in  100  test-­‐drives  (C’)  for   personalized  visual.  The  cr  is  boosted  by   100%.     Reach   R,  R’   Personalized funnels based on process automation. Conversion   C’   C   personaliza5on  
  53. 53. 5th RICHMOND MARKETING FORUM Our goal: Convert a passerby into signing-up for a test-drive (ultimate online conversion). Involved Visit 3rd party pages Ad w/ config. model Retargeting on 3rd party pages with configured model.
  54. 54. 5th RICHMOND MARKETING FORUM Our goal: Convert a passerby into signing-up for a test-drive (ultimate online conversion). Leads Saved config. Mail w/ config. model Personalized mailing with configured model. Invitation to test-drive at local dealer.
  55. 55. 5th RICHMOND MARKETING FORUM Personalization calculated like targeting segments: Smaller, but more precise reach, higher conversion. How  it  is  calculated:     Personaliza/on  works  like  precise   targe/ng,  e.g.  only  addressing  customers   who  are  most  likely  to  buy.       Addi/onal  costs  (e.g.  predic/ve  analy/cs),   but  the  hypothesis  is  that  a  way  higher   percentage  of  customers  will  buy.       Example:  If  10.000  website  visitors  (R)   result  in  50  test-­‐drives  (C)  for  default   visual,  but  2000  personalized  mailings  (R’)   in  35  test-­‐drives  (C’).  The  cr  is  boosted  by   12.5%.   Multi-Funnel w/ personalized offerings Conversion   Reach   R’   C   C’   personaliza5on   R  
  56. 56. 5th RICHMOND MARKETING FORUM Results of all activities: Significant leverage of the online conversion.
  57. 57. 5th RICHMOND MARKETING FORUM But on the other hand: What did it it take to “produce” a personalized offering? –  The  ideas     –  The  so,ware   –  The  people   –  The  processes   –  The  rollout   –  The  management   –  The  overhead   –  The  nerves     –  …  
  58. 58. 5th RICHMOND MARKETING FORUM Reality Check (3/4). Myth     “86  %  of  all  marketers  say  that   personaliza/on  is  the  key  to  more  sales.”   Reality     -­‐  Be  careful  with  statements  like  these:  Some   are  made  based  on  a  lack  of  understanding   (it  is  not  about  monopoly  returns)   -­‐  In  most  cases  we  see  indirect  effects  on  sales   revenues   -­‐  But  it  is  always  super  hard  to  determine   effects  exactly   -­‐  Please  do  not  mashup  sales  revenues  with   ROI   -­‐  Most  important:  Focus  on  goal   measurement.  At  best,  measure  the  success   for  each  single  step    of  the  customer  journey.      
  59. 59. 5th RICHMOND MARKETING FORUM       Nellix  are  top  of  class  when   it  comes  to  personaliza5on   –  do  it  like  them  to  be   successful.”     Reports   “Personaliza5on  is  about   the  ‘segment  of  one’,  a   totally  individual  offering  to   each  client.”   “86  %  of  all  marketers  say   that  personaliza5on  is  the   key  to  more  sales.”   “Personaliza5on  is  about   the  ‘segment  of  one’,  a   totally  individual  offering  to   each  client.”   TYPICAL   SCENARIOS  
  60. 60. 5th RICHMOND MARKETING FORUM Reality Check (4/4). Myth     “Neqlix  are  top  of  class  when  it   comes  to  personaliza/on  –  do  it  like   them  to  be  successful.”     Reality     ?  
  61. 61. 5th RICHMOND MARKETING FORUM First: Is Netflix successful? The answer is yes.
  62. 62. 5th RICHMOND MARKETING FORUM Second: Did Netflix totally reinvent personalization or recommender engines? No.
  63. 63. 5th RICHMOND MARKETING FORUM Third: Does Netflix care about personalization or recommender engines? Yes, a lot!
  64. 64. 5th RICHMOND MARKETING FORUM Fourth: Are they best in class? Well, the question is: Who decides who’s best in class?
  65. 65. 5th RICHMOND MARKETING FORUM In fact, the algorithm had to fight a so called cold start problem, building up all customer profiles. Example:  Thumbs  up  for  “The  Hangover”  +  “The  Hangover  2”  results  in  a  68%  matching  for  “The   Hangover  3”,  but  a  92%  matching  for  “The  Lion  King”?  
  66. 66. 5th RICHMOND MARKETING FORUM But more importantly, does Netflix think they will ever be “finished” with personalization? No!
  67. 67. 5th RICHMOND MARKETING FORUM Current open job positions for issues like “recommendation” or “personalization”.
  68. 68. 5th RICHMOND MARKETING FORUM Final question: Do we need to do it like Netflix? –  Are  you  ren/ng  movies  or  providing  a  video  plaqorm?     –  Are  you  opera/ng  online-­‐only?   –  Is  your  business  model  based  on  subscrip/on  fees?   –  Are  you  a  VC-­‐financend,  US-­‐based  company  with  an  aggressive  growth  strategy?   –  Is  your  target  customer  segment  simply  everyone  between  20  and  55  years  of  age?   –  Does  your  marke/ng  department  include  40  people  working  on  a  single  algorithm?  
  69. 69. 5th RICHMOND MARKETING FORUM Reality Check (4/4). Myth     “Neqlix  are  top  of  class  when  it  comes  to   personaliza/on  –  do  it  like  them  to  be   successful.”     Reality     -­‐  Neqlix  is  top  of  class,  but  also  they  can   can  fail   -­‐  There  is  no  impera/ve  of  doing  it  like   Amazon,  Neqlix  or  Spo/fy   -­‐  It  is  not  the  “what  they  do”  but  the   “how  they  do  it”  where  we  can  learn   the  most   -­‐  Neqlix  again  shows  us  the  importance   of  tes/ng.   -­‐  Never  underes/mate  effects  of   “serendipity”  while  looking  for  best   prac/ces  in  the  silicon  valley.  
  70. 70. 5th RICHMOND MARKETING FORUM SUMMARY    
  71. 71. 5th RICHMOND MARKETING FORUM       Nellix  are  top  of  class  when   it  comes  to  personaliza5on   –  do  it  like  them  to  be   successful.”     Reports   “Personaliza5on  is  about   the  ‘segment  of  one’,  a   totally  individual  offering  to   each  client.”   “86  %  of  all  marketers  say   that  personaliza5on  is  the   key  to  more  sales.”   “Personaliza5on  is  about   the  ‘segment  of  one’,  a   totally  individual  offering  to   each  client.”   TYPICAL   MYTH  
  72. 72. 5th RICHMOND MARKETING FORUM Reports         Nellix  are  top  of  class  when   it  comes  to  personaliza5on   –  do  it  like  them  to  be   successful.”     “Personaliza5on  is  about   the  ‘segment  of  one’,  a   totally  individual  offering  to   each  client.”   “86  %  of  all  marketers  say   that  personaliza5on  is  the   key  to  more  sales.”   No,  it’s  not.   “Personaliza5on  is  about   the  ‘segment  of  one’,  a   totally  individual  offering  to   each  client.”   I  don´t  think  so.   No,  it’s  not.   Not  the  point.   CONCLUSION  
  73. 73. 5th RICHMOND MARKETING FORUM       Don’t  believe  in   impera5ves.  There  never   has  been  a  collapse  due  to   the  lack  of  personaliza5on.   Look  behind  the  scenes.         Reports   Pursuit  your  individual   sweet  spot,  the  amount  of   customer  segments  that  you   can  handle  in  marke-­‐   5ng.   Look  at  the  issue     step  by  step  within  the   customer  journey  that  you   strive  for.  Measure,  but  do   not  mash  up  conversion   rates  and  ROI.     Remember  your  business   goals,  take  a  look  on  your   data  and  channels,  make        a   concept,  select  a  tool     and  start.     ADVICE  
  74. 74. 5th RICHMOND MARKETING FORUM       Don’t  believe  in   impera5ves.  There  never   has  been  a  collapse  due  to   the  lack  of  personaliza5on.   Look  behind  the  scenes.         Reports   Pursuit  your  individual   sweet  spot,  the  amount  of   customer  segments  that  you   can  handle  in     marke5ng.   Look  at  the  issue     step  by  step  within  the   customer  journey  that  you   strive  for.  Measure,  but  do   not  mash  up  conversion   rates  and  ROI.     Remember  your  business   goals,  take  a  look  on  your   data  and  channels,  make        a   concept,  select  a  tool     and  start.     STRATEGY  
  75. 75. 5th RICHMOND MARKETING FORUM Thank you.

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