Forget Personalization vs. Relevancy: Why Transparency is Key

Author

Jerry Jao, Contributor

May 2, 2015

I’ve written previously about the evolution of customer retention, as well as the future of effective Retention Marketing. Both topics touch on the importance of personalization in marketing; of providing value to customers on an individualized level; and of sustaining that engagement through insights gained from analyzing and understanding customer data.

While it seems the tide is indeed turning for marketers who embrace the idea of data-driven marketing and providing tailored experiences for customers, there has been some debate on word choice as of late. According to a recent article on Buzzfeed News, executives of brands like Macy’s and WalMart have shunned the term “personalization” as being too creepy; instead, it’s all about “relevancy,” presenting “relevant” products and content to customers.

The argument against “personalization” is that it has become an issue of privacy and personal data. It’s the idea that companies have become too much like Big Brother, tracking the customer’s every move and therefore anticipating their actions and purchases.

Relevance, by the same logic, has less emphasis on the personal data factor, and more emphasis on the usefulness of providing contextually relevant information. It’s engineered for the customer, but not quite personalized.  It’s cool, but not creepy.

Ultimately, the difference between the two terms comes down to nuance, and is largely negligible. Both methods involve using customer data to present the right content or offer at the time most likely to engage the customer. Both methods are about providing a one-to-one, tailored experience to the customer. One just doesn’t have the word “personal” in it, which avoids certain connotations. Simply put, it’s semantics, and a play at changing customer perception.

And frankly, it’s an insult to your customers’ intelligence.

There is no doubt now that companies have access to an immense amount of customer data. More importantly, there is no doubt that customers know that companies have access to this data. In a 2012 survey by Accenture, 86% of respondents were aware – and concerned – of how their online shopping habits were being tracked. More significant, however, is that 85% said they understood that tracking enabled companies to provide tailored content or offers. When given the choice, nearly two-thirds (64%) chose a personalized experience based on their past behavior over complete web privacy with no personalization.

This isn’t a surprise. Today’s shoppers are increasingly tech-savvy, connected, and informed. Social media and the Internet has provided them access to more information than ever. They have taken control of the purchasing experience: the prevalence of comparison-shopping, of showrooming and webrooming before purchasing, and dependence on customer reviews reflect this. Shoppers know they have choices, and aren’t afraid to take advantage.

Above all, shoppers want to be treated as people – and increasingly, as informed and equal parties to the brand-consumer relationship. As such, they’re willing to trade their information for experiences that provide value to them. A few bonus incentives would help sweeten the deal: key perks cited for allowing companies access to their data include access to exclusive deals (64%), discounts (61%), or special offers (61%), according to the 2015 Accenture Personalization Survey.

It’s clear, then, that consumers already understand what the term “personalization” means in terms of their data-driven shopping experiences. For brands, simply switching from “personalization” to “relevancy” is not a solution to being seen as less creepy. Ultimately, shoppers want value from brands, and they’re open to exchanging information for a better retail experience – as long as they’re kept in the loop.

Instead of mincing words, brands should focus on transparency. Approaching the exchange of data for value – both in the long-term as personalized experiences and in the short-term as incentives or special perks – is a win-win situation. It helps brands create long-term customer engagement and loyalty, and allows customers to feel comfortable with how their data is used.

As for the key to not seeming creepy, it’s pretty simple. Don’t be sneaky – which includes cutting out the word games.

This article was written by Jerry Jao from Forbes and was legally licensed through the NewsCred publisher network.


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