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Personalized marketing rooted in customer insight

Knowing as much as possible about customers is the first step in personalized marketing. But these practices mean nothing without customer trust.

Today, more than ever, companies need to make decisions based on the needs of their customers. This extends to almost every aspect of the business, from the products offered to customer service. Companies that want to personalize their offerings need customer data to do it, but they won't be successful without a strong foundation of trust among customers.

As companies strive to foster deep customer engagement and achieve personalized marketing, they must continually listen to their customers, understand their individual needs and build experiences that separate them from competitors. The voice of the customer must inform everything the company does, as organizations must use customer insights to understand how different customer segments define what constitutes a positive experience. When companies know what their customers want, then it's up to them to put those insights into action to improve the customer experience across every touch point.

Personalized marketing drives engagement

Even when a company puts a plan into action, it cannot be a one-time act. High-quality experiences must be maintained and experientially adjusted throughout the customer relationship to constantly remain relevant to consumers.

"We work hard to first understand the needs of the customer," said Mike Rude, who works to improve the customer experience at FedEx. "Focus on understanding what the customer wants and how to use technology to deliver on those expectations."

Online retailer Gilt uses customer insights to drive deep personalization across all channels and touch points. As a result, the company has increased orders, decreased unsubscribe rates on its emails and achieved higher repeat-purchase rates. "All communication is personalized," said Welington Fonseca, former vice president of marketing and digital analytics. "Sales [are presented according to] the highest affinity to a consumer's past behavior and preferences (browse, purchase, favorite brands, wish list) with all other sales ranked according to relevance based on previous shopping behavior and collaborative filtering."

Elements of human data

Gathering data on your customers is crucial to any personalized marketing campaign. But companies need to know what kinds of customer data is important to collect so they can market to the right people at the right time.

Some of the opt-in, self-profiled customer information business-to-business (B2B) and business-to-consumer companies include the following:

Things customers care about. Examine customers' key issues, needs and expectations when it comes to your company's products and services. What are your customers' problems and how do you aim to solve them with your products? What is lacking in your products or services that can be fixed so that your customers don't defect?

Information on the decision-making process. In B2B sales, knowing the roles and job titles of influencers and decision makers is crucial. You want to get as close to the leaders as you can to gather information on their pain points and on what they're looking for in a product so you can tailor your pitch to appeal to them.

How they want to communicate. Maybe your customers prefer to use email rather than making a phone call. Either way, your messaging and media preferences should mirror that of your customer base. Know which channels your customers are most comfortable with using and develop a presence on those channels that meets their expectations.

Who they are. Learn your customers' self-described personality types, attitudes and interests. Whether you want to appeal more to a certain type of person or branch out and gain new customers who you haven't typically dealt with, you must proactively identify your customers' interests and deliver them relevant content based on that data.

Four levels of customer trust

But customers won't give up this information to just any company; companies have to earn it. Customers want their personal data to be safe, so their demands to companies are based on trust.

Do what you promised. Deliver on your fundamental brand promise. Failing to is a deal-breaker for many customers. A company's brand promise must remain consistent to customers from their first interaction throughout their lifecycle.

Treat me fairly. Fair customer-focused pricing and customer service policies.

Protect my information. Explain the reasons for the opt-in information requests and assure customers of the privacy and safety of their data.

Improve my experiences. Use customers' stated preferences and aversions to dramatically improve their experiences. Conduct research with an eye toward continually improving the customer experience based on evolving customer needs.

But companies must recognize that different customer segments will react differently to various aspects of the customer experience. Different segments will have varying definitions of what constitutes a high-value, personal experience. A deep understanding of customers' needs and expectations of service will enable you to learn what human data customers want you to use to significantly improve their customer experiences.

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