Conditional Love: The Relationship Between Data and Personalization that Keeps Customers Faithful

Media Thumbnail
  • 0.5
  • 1
  • 1.25
  • 1.5
  • 1.75
  • 2
This is a podcast episode titled, Conditional Love: The Relationship Between Data and Personalization that Keeps Customers Faithful. The summary for this episode is: <p>Digital marketing pro are waking up to the fact that digitally-savvy, channel-agnostic consumers no longer choose who they do business with because of products and services a company offers, but rather give loyalty to those that deliver the "assortment of conditions" under which the individual wants to buy.</p><p>In this session, we'll reveal how the exchange of value and real time engagement creates perceivable value and relevancy to each consumer’s buying journey through personalization.</p><p>Those that do are better able to win, serve, and retain customers heading into 2023. In this session, guest speaker and Forrester VP/Principal Analyst, Brendan Witcher, will reveal:</p><h5>Takeaways:</h5><ol><li>What makes customers choose who they do business with (really!)</li><li>How a model for deep understanding of the customer is the only path to differentiated personalization</li><li>What approaches to personalization cause companies to achieve good, better, and best results</li><li>Why data and personalization are keys to unlocking potential of your loyalty programs and marketing</li><li>Which companies are successfully using data and advanced levels of personalization to win customers today</li></ol><p><br></p>
"It's what you know for sure that just ain't so" that gets marketers into trouble.
01:50 MIN
Do we really know what the customer is looking for?
00:49 MIN
Ask the right questions to avoid a disconnect between what the executive team believes and what the customers really value or else your entire strategy will be off.
01:49 MIN
61% of customers are unlikely to return to a website that does not provide a satisfactory customer experience, & "satisfactory" can mean different things to different people.
02:45 MIN
Over 80% of consumers are willing to share personal data to get a better experience.
00:32 MIN
The better you know your customer, the better you can serve and win them.
00:48 MIN
Are you using the right tools but on the wrong customer at the wrong time and place?
01:35 MIN
Digital sameness is pervasive because of a lack of customer knowledge.
01:02 MIN
"Good is the enemy of the great."
00:51 MIN
92% of companies are investing in personalization vs. 30% of consumers say the information they get from brands is relevant to their interests.
02:16 MIN
How to be customer-obsessed and not "company-obsessed" with a data-led strategy (not "data-driven").
03:05 MIN
Consider this to define your data strategy: if you knew X, you could do Y for your customers.
01:49 MIN
The 6 Cs of customer data elements, starting with #1: Characteristics
01:56 MIN
#2: Considerations --understanding the customer's intent
01:29 MIN
Your best customers are not the people currently buying from you - growth is converting them from someone else.
01:07 MIN
#3: Curiosities -- Understanding the specific attributes the customer cares about to create real differentiation for them.
02:02 MIN
#4: Conditions: Understanding that individual products that consumers want to buy have their own conditions associated with them.
02:22 MIN
#5: Context -- understanding their buying mechanism, typical buying window, etc. to connect with the customer at the right time.
01:29 MIN
#6: Conceptions -- We're on the cusp of being able to understand customer's emotions in the moment using AI so keep this on your roadmap.
01:25 MIN
The data you're chasing must be actionable & serve a business purpose or you're wasting your time.
03:07 MIN
Execute better on the information & assets you already have, with individualization through a one-to-one relationship across all channels.
02:35 MIN
Build digital touch points that deliver an experience AND gathers customer data.
01:11 MIN
When selecting a martech vendor, companies say that ease of integration with other data sources and systems is one of the most important factors.
01:03 MIN
The pandemic has made us channel agnostic, digitally savvy, & more comfortable sharing data, preparing us for a future of in-line commerce.
02:16 MIN
Companies need to change their culture, organization, technology, and metrics.
00:42 MIN
5 key takeaways: (1) break company assumptions, (2) don't get too far ahead or behind of the customer, (3) fish where the fish are, (4) don't rush to check the box, & (5) don't focus on surprising & delighting your customers - fix their pain points!
03:04 MIN

Brendan: Hi, my name is Brendan Witcher. I am Vice President, principal analyst here at Forrester, and I'm here to talk to you today about work that I did, research that I did around the idea of conditional love, or what is the relationship between data and personalization that keeps customers faithful. Now, as an analyst, one of the things I'm always searching for and trying to understand is, what are the things that we may not be looking for? The things that we are curious about that we say, " Well, is this something that I'm forgetting? Is there something that I'm missing? Is there something that I need to do?" It's encapsulated in some way in this quote here that Mark Twain's given credit for, and it actually was featured in the opening scene for the movie, The Big Short. That line is, it ain't what you don't know that gets you into trouble. It's what you know for sure that just ain't so. You can focus on that last part. It's what for sure that just ain't so. And that really clued me in to what's going on in the industry right now because I've been an analyst for about eight years. Before that, I was head of strategy for Guitar Center. Before that, I was in marketing at Harry and David. I know that over the years I've heard numerous companies say, Well, we know the customer, we understand the customer, we know what they want, we know what they need. Then kind of glaze over that. It's an priori statement, this sort of idea of, because we know this, we can do all of these things. But as an analyst, I started to ask myself as I was covering things like personalization, other things, I started to ask, but do you? Do we know the customer? Ironically, Mark Twain actually never even said this statement. So in some ways this statement in of itself is a problem, but it gets to the point that we're saying, which is that it's what you don't know that you think is true, that can get you into lot of trouble. I'm going to show you later why that causes such problems for some organizations and why getting to know the customer better is going to be the key to being successful in all these initiatives that you're working on as an organization today. So this just ain't so reality. We really don't know what we're doing. I wish we did, but it's not our fault. We don't have to blame ourselves. We can blame this person, the customer. We can blame it all on the customer. And why? Because they're dynamic, they're unique, they have special needs of what they want and don't want an experience. It goes not only to the individual customer, but it goes to what they're going to buy, what they're interested in. What are they looking for? What channel are they using? There's so much to it. Now you may say, Well, Brendan, you're kind of saying the same things I hear all the time, and that's true. But let's dig a little bit deeper if you don't mind. When I say, who is this person? Now you would tell me probably things like, Oh, it's a female and they're buying online and they have brown hair, things of that nature. But do you really know who they are? Do you know what they need, what they want, what they're looking for? You can just fade the graphic, this graphic on that one. All right, I was recently working on a project with a client and I asked them, Well, why are your customers buying from you? What are they looking for? What do they need? When I was talking to the executive team, many of them said, " Well, we know that our data shows and our customers love us because of our unique products are focused on quality and our alignment with the customer's values," which sounds really good. It sounds really fun and interesting and sounds like something that most companies would say. Well, this is actually easy data to get to because you can just ask your customers, Do you love us because of our unique products, our focus on quality and our alignment with your values, yes or no? So that data comes back as yes, and then you can just move on. The problem is this doesn't really tell us a whole lot about the customer. In fact, as part of this project that I did, this consulting project that I did, I went out and interviewed some of these retailers, very best clients, and I asked our customers. I said, " Why are you shopping with this brand?" Again, these are their very best customers. They said, " Well, I love going into their stores. Even though they have a website, if I didn't live near their store, I would likely stop shopping with them." Now, I want you to take a look for a second and compare these two things. You start to realize, wow, there's a huge disconnect here between what the executive team believes and what the customers really value. And what does that mean? It means that the messaging you send out is going to be off. It means that the things you talk about to the customer are going to be off. Your belief system is off. You're designing around customer experiences and values that the customer just says, Yeah, that's nice, but actually this is the primary reason that I'm shopping with you. Without that vision, without that view, without that understanding, we can very easily get into trouble. You can see how strategies start to develop in the wrong kind of way. When we don't understand the customer, so I know a lot of people will say, Oh, Forester analyst is going to speak. They're going to give us this silver bullet for solving all of our problems, blah, blah, blah. But actually that never happens. The reason that never happens when it comes to the customer is because we are dynamic, because we are unique. As I said earlier, let me show you what I mean by that. 61% of consumers say I'm unlikely to return to website that does not provide a satisfactory customer experience. Honestly, that is not a very interesting statement or data point for that matter. You probably could have guessed that 61% would say that, probably may have even higher, but I put this up there not for the stat. I put this up there because it's a very important word in this survey question, and that is the word satisfactory. What does satisfactory mean? Well, to the company it may mean one thing. You're trying to define for the customer what is satisfactory, but in fact, we get to define that, consumers get to define that. We get to say what is satisfactory to us. Now, why is this so important? Because actually what can be satisfactory can be very different from person to person to person. For example, I'm an analyst, and so that means if I want to buy something, even a pen, and I'm not actually kidding here... If I'm going to buy a pen, I want to see comparison charts and product reviews and all these things even to buy something as banal all as a pen. But I do that with everything, refrigerators, stoves, whatever it is, airline tickets. I want to understand all that I get with flying on this airline. Or a hotel room. Do they have certain elements? I want to do research. That's who I am. My wife, and I know this because we share a credit card and I can see the statements, she'll buy anything you put in front of her if you give her a discount on something because she values coupons and discounts and offers. For each of us, it's a unique thing that we're looking for. What makes us loyal to a brand is not going to be same from one person to the next, which is why there's never going to be one thing to win every customer. Some customers want video and experience, some customers want product reviews. Some people want same day delivery. Some people want someone to help them with buying a 529 college savings plan. Some people want them to help with an insurance policy, be able to do video chat in the experience. Some people want to talk to a local associate that works in a local physical location through the app. There's all these things that each of us say we want, but we don't want all of them. That's the important part. Not all of us say, Well, that's an important part of the experience. Take same day delivery. That may be important to some of you in some of your buying, but I don't think there's anybody out there that says, I only buy with companies, for example, in retail that give same day delivery. That just would be unreasonable. So it isn't a requirement to buying, but for some customers it is a preference for their buying. And by understanding and knowing what the individual customer wants, we're able to get to a better level of personalization and creating rich, relevant value added experiences for that customer. Now, when I was in retail, I used to say, Okay, well we know the customer because we knew their age and their gender and their zip code and the last product they purchased. We check the box on knowing a customer. But the customer is so, so, so complicated, and the reality is that we're in a good position now because consumers today are willing to share more information than ever before. In fact, over 80% of consumers say, I'm willing to share personal data just to get a better experience. So we're comfortable sharing. I'm going to show you some examples of this later so you understand what I mean by that. But just take a look at this chart here. You can see that when you think about your understanding the customer, think about your customer database as an example. If you went into your database, do you think you would have all these elements about the customer? Probably not. And what does that mean? Well, it means that you probably can't create great experiences for your customers because it is almost ridiculous to say we can create great experiences for customers that we barely understand. That is almost the definition of insane in my book. You need to know your customer, and the better you know them, the better you understand them. That's when you can serve them better and that's when you can win them. That is a hard truth that a lot of companies just don't realize. In fact, they often use opinions and things of that nature. I'm going to get into that a minute for driving their data strategy and for understanding their customer. But in truth, surprising and delighting the customer, that's just not going to happen. Nobody goes home and says, Bank of America really surprised and delighted me today. Or Best Buy surprise and delighted me today. We don't talk like that. Nobody talks like that. We are just saying, That was nice, that was good, that's work for me, that sort of thing. So that's what we should be hoping for. But at the end of the day, what really happens is that companies have the right tools. They feel like they're doing the right things. I bet that's you right now. You're like, I feel like we're doing the right things, but for some reason it's just not having the impact that I would've thought. And part of that is because the application of the things that you're doing using the right tools, but you're using them on the wrong customers at the wrong time, at the wrong place. So you're doing all the right things, check the box. But it's this disconnect between understanding the customer and what you're trying to accomplish that causes customer experience to look more like this. Your strategy kind of falls apart. As I showed earlier when I was talking about that brand that believed customers were shopping with them because they aligned with their values and their quality and all those sorts of things, when in fact consumers said, I really value the experience of the store. And if you keep helping me with that and improving that for me, and reminding me that this is why I choose you, then I'm you're likely to stay more top of mind with me as a company. This is the kind of thing that companies need to let go of. I know it's hard. I know it's difficult, and I don't mean to sound like Dr. Phil here, but the truth is you got to let go of some of this belief that you know the customer because, if you do that, it does open the door. It opens the aperture, if you will, of the way you can view them, the way you can understand to the level and the degree that you can serve them. Now, the hard reality is that digital sameness is pervasive because of this lack of knowledge. Let's take a look what I mean. In 2021 in the US for example, 68% of consumers basically ranked experiences they were getting as an overwhelming, These are fine, they're okay, they're not great. Only 23% say good. We can't even round up to 1% that say excellent. So when I said we're not surprising and delighting customers, I wasn't kidding. The data shows we are absolutely not delivering experiences of surprise and delighting anyone. You know when we surprised to delight people? Technically when we solve a problem they didn't expect us to solve. That's when we surprised and delight customers. But in general, when I buy something or I get something or I get a service or whatever it is, I don't really say, Yeah, that's wonderful. Because you gave me this experience. I'm going to suddenly give you all my business. So why can't we get past this? Why are so many companies sitting in this okay state and even good, but nobody's getting to excellent or great? Well, this is not a new concept. Actually, Jim Collins in his book, Good to Great, outlines this in the very first sentence of the book. I like the book, but if you just understand this first sentence, you understand the majority of the book. I'm going to save you 275 pages of reading here. The idea is that good is the enemy of great means that once we do things good, we tend not to make them great. We tend to say, Oh, that's good. That's what everyone else is doing. So it's good enough. Let's move on to something else. Well, what does that mean for you? It means you're not differentiating your experiences at all. It means that you're just doing what everyone else is doing. So do you have a competitive advantage? No, you don't. You really don't. You really don't have an advantage over your competitors because you're just meeting the mark with where they're at. So this is the problem. This is where we say, Okay, can we say that we surprise and delight. No. Can we say or differentiate experiences? No. What is the answer to that? Well, the answer to that is to rethink the way you approach things. So one of the challenges that I find companies have is that they have these initiatives that are all about creating great customer experiences, but they don't really deliver on those promises. For example, you may say, Well, everyone's doing personalization. In fact, the data would show that 92%, which is nearly everyone, say we're investing in personalizing the customer experience. Check. All good. The challenge is that 30% of consumers say, information I get from brands is relevant to my taste and interest. By the way, that number's down from prior years. So which number's right? They can't both be right. It's either personalized or it's not. Well, it's the 30% of course, because who gets to determine if it's personalized? Not the company. It's the customer. The customer gets to say, that was relevant, that added value to my experience. That's up to them. So it looks like you're winning, when in fact the data shows that you're not. So one of the things that's really a problem is that companies say we're doing personalization, we're putting a name on a homepage or an email or we're making product recommendations that an algorithm says should meet a certain amount of customer's needs. What ends up happening is you move on to the next thing. Again, the good to great problem is in full swing here. What happens is that consumers get these experiences, and 70% of the time, if you looked at it from the opposite of 30%, they're not getting personalization. They're getting marketing, just general marketing that isn't of relevant value to them, which is why we're not getting these huge lists from creating personalization. So in a nutshell, what I'm trying to say to you is when you're trying to do personalization, you're trying to get it better, you're not going to hit the mark as often if you don't know the customer, you don't understand them. So all your personalization efforts, all these efforts to create great experiences hinge on the ability to know the customer. Now I know I'm willing to say that is a very unsexy topic. The idea of data collection and learning about the customer. Don't we all just want to create these great experiences, that sexy experiences everyone talks about on CNBC and the Wall Street Journal? Sure, of course we do. But the truth is that we can't do it unless we do the unsexy work of learning about the customer first. So we got to make data sexy. So that's the key and that's the goal. So how do we do this? Well, we do this first by understanding the difference between customer obsession and company obsession. 2014, the selling strategy used to be, well, we need to be customer obsessed. Everybody said that. Forestry even said that, everyone was saying that, right? But what we found is that as companies started saying this, they said things like, Well, we want to make it convenient, simple, and easy for customers to buy our products. So first of all, convenient, simple and easy, these are banal platitudes that mean almost nothing. When we ask consumers, when you shopped online the last time you shopped, why'd you do it? They'll say it was convenient, simple and easy. So same customers the last time you shopped in stores, why'd you do it? It was convenient, simple and easy. Have you learned anything? No, you haven't learned anything about the customer. You don't know anything about the customer. So this is not a north star goal that you should try to achieve. You need more nuance than this, more details and that matters. The other part, and you may not have noticed it, but the words right at the beginning of this sentence become a problem. We want to make it convenient, simple and easy for customers to buy our products. We want is a very different statement than our customers want. I often find that companies misunderstand the differences between company obsession and customer obsession. I want you to leave this session today and listen for the words that are used around your organization. How many times do people say, we want to do this for the customer, we want to do that for the customer. So that's all well and good, but what does the customer want? And not just the customer as in an aggregated general, all customers are exactly the same kind of view, but rather what does the individual customer want? We know that X customers want this and these customers want that, and Z customers want that. So we know that each customer has their own unique wants and needs and we're going to be able to serve them. It's not what you want to do or what I want to do. It's what the customer wants to experience. And if you're never going to learn that, you're never going to be able to deliver that experience. So a lot of people are sitting in this company obsessed state and they never get to that customer obsessed state, which requires you to have an engagement strategy. Not just a selling strategy, but an engagement strategy that finishes a sentence. We need to be customer obsessed, but that requires you, requires you to be a data led organization. When I say data led, it's a little bit different than data driven. Data led organizations, what they'll do is they'll wait for the data. They'll look at data and they'll say, Okay, I'm learning something here. I understand the strategic decisions we should be making and I'm going to move forward. A data driven company I have often found will use data after they've already made a strategic decision. In fact, 48% of companies self- identify as companies that will make a strategic decision and then go out and find data to prove that that decision is correct. You can see the flaws in that thinking, right? Because we know how business operates and often they'll throw out data that says, I disagree with this because it's already been socialized and it's already been shared. So this creates a big problem for organizations because they can't really go back on what they said they're going to do, because they've already announced it, and yet they have to find a way to justify it. And they often do it by finding data that even tangentially or even peripherally proves that this is the moves they should be making. So how do we get to a better state? How do we get to a better way of dealing with the customer? We have a plan about understanding the customer that has structure to it. Now you're thinking I'm going to show you this big hairy model, and I am in a second, but I'm going to say first it really just comes down to this. It is this simple. I know it looks like, oh, that's it. A Post It note with a couple of words on it? Yeah, it is, because what you can do with this is just amazing and impactful. So when I'm doing advisory with our clients and I sit down in a room with them and I say, Okay, I'm going to do a little exercise here. What I'd like you to do is I'd like you to take this post- it note. Yeah, I really do bring post- it notes, and I have them fill out the X and the Y. If we knew X, meaning something about the customer, we could do Y. That would be the value or relevancy we're going to be delivering for them. So we can learn something about them. They only shop on the weekends or that they always buy for somebody else or they're not actually customers. They're gifting, or that they really value buy online, pick up in store, or they really value coupons, or they like to use their mobile device for shopping, but they really do like to shop online instead. They want to browse in their mobile and shop out... There's so many things that I can come up with here. So I'm not going to waste all our time going through all the iterations of that. But at the core of it, when I get done with them filling out maybe four or five of these things, I then collect them. I go around the room and collect them. Remember these are Fortune 100 companies. So I put them up on the wall and I say, Congratulations, you just start your first data strategy ever. A lot of times they're trying to do things using their opinions, and this was the first time in many cases where they've sat down and said, But what does the customer want? What do we need to learn about them? Not the customer, the aggregate customer, but what does an individual customer maybe want that we need to learn about so that we can better provide a service for them? It's a simple exercise, but it gets you to the core of what you need to do. Now there's other parts and pieces of this that go beyond that moment. It's actually just a first step in a multi- step workshop that I do. But at its core, this is what it gets to. If you can start here, this is a good way of doing it. Now I'm going to show you the big hairy model of how to put this all together for your organization and how to think about this. All right, so here it is. I probably oversold it. It's not as complicated as I made it out to be and that's a good thing. But here's the thing. You need operational guardrails and customer data elements to be able to execute on this. So let's go through the sexy stuff first, which is the customer data elements. You can see those are on the right hand side and they consist of the six Cs; characteristics, considerations, curiosities, conditions, context and conceptions. What are these things? We're going to go through them one at a time. Then afterwards I'm going to talk about these operational guard rails, which are not as sexy at all, but they're going to be something that you need to do in order to make sure that your company's working on the right thing. Not working on just getting more data, but getting the right data to execute what you need. So let's kick it off going right into customer data elements. And note these are in order from easiest to hardest. In fact, many of you are probably going to say, Yeah, we already do number one. And that's probably true. You probably already have information about the customer. That includes things like age, gender, height, weight, career, income, zip code, ethnicity, marital status, family status, affiliations, even their buying history. These are factual things. The key point about this is you could probably go out and buy this information, and that leads you to the other problem, which is like I said earlier, once you're doing the things that everyone else is doing, you create no differentiation. Do you really think there are companies out there that don't have this information? You can go out and get it. It's not that hard to get. Almost everybody knows my age and my gender and my zip. That's easy. There are companies literally that can take your email address and append it to all of this data. So if we're learning the same things about the customers as everyone else, can we really create differentiation? No. This is a good first step. Don't get me wrong. If you're not doing this, get started. But actually at this level, you're not actually going to win customers any better than anybody else. The next step down though is where it starts to get very interesting. The idea is considerations. What do I want to buy or accomplish in this session? The first part of this statement or question is actually pretty easy to understand because we talk about it all the time. What is the customer's intent? I intend to buy a camera. I intend to buy a toothbrush or something of that nature. I intend to buy a 529 college savings plan or motorcycle insurance. These are all easy to get to because it takes just a few clicks. Again, for everybody, it takes a few clicks to learn that I'm interested in buying an Android phone versus an Apple phone. That's really easy. But what's really hard to understand is what am I trying to accomplish in this session? That's why I have the graphic, the data points below. If you're like the average company, your conversion rate is probably somewhere around 10% on your website, just as an example. These are the people that are committed to buying from you. You've met their needs, you've met their conditions, and they've said, You know what? I'm good. This is great, but then you have to ask yourself, but what about the other 90%? This is a very interesting phenomena that goes on in industry is that we focus on the 10% of customers who are already saying, I approve and I'm willing to buy from you. And we completely ignore what I call the consideration rate, which is the majority of your visitors to your website. Do you know why they left? Do you understand what they didn't find? Do really what they were looking for and what are the nuances of those things they were looking for? Why did they walk away? This is just a very interesting thing because... I'm going to say something fairly controversial and I hope that's okay. First of all, your very best customers are not the people currently buying from you. I know that's crazy, but it's not. Your best customers, if you truly care about growth, are going to come from the people that are buying from somebody else but have the potential to be your customer. See, that's the thing. Growth isn't about squeezing more dollars out of your best customers. You probably already have all their money. It's a Guitar Center. Our best customer isn't spending$ 40,000 a year with us. We had customers like that. But our best customer, if we want to achieve growth, is someone who's spending$40, 000 with somebody else. That's who we have to go after. That's the consideration rate. They're not converting with you and you need to go after them. So that's level two down. When you start to understand that you need to focus just as much, if not more, in my opinion, on the consideration rate, those customers that are saying, should I be buying from you or should I not be buying from you? That's a mind shift change. The mind shift change to say we've checked the box on so many people, let's move over these people that we haven't checked the box on yet. It sets you up for the next stage of saying, Okay, but what did they care about? The next layer down, again in order of difficulty, is curiosities. So for example, and I use retail a lot because I like to talk about shopping and everybody shops. So you may say, Well we know that Brendan's intent is to buy a leather jacket. Okay, all well and good. But if you stop there, good to great is again in full swing. You're doing the good to great thing. We know he wants a leather jacket, so let's start giving him promotions and retargeting him on leather jackets. You haven't learned enough yet. Think about an in- store experience. If I told an associate I'm interested in leather jackets and they go, " They're over there," would you say that was a good associate? No. You'd say it was a terrible associate. The good associate says, " Well, what do you care about? Do you care if it's real? If it's fake?" I happen to live with three vegans. If I bring home a real leather jacket, I'm sleeping on the couch. So the thing if it is like what is it that I care about? There's so many things. You may say, Okay, real and fake. That's just two. All right. How about if it's long, if it's short, if it's brown, if it's red, if it's green, if it's blue, if it's got a line or if it doesn't have a line, or if it's got that Bon Jovi frilly stuff on it, right? If it's got zippers or buttons. There's so many things that make a product unique that I'm going to care about. It can be all that. You may say, Well customer always has left navigation to go to. Sure you can do that. If you want to count on the customer to do that every single time and that's going to be your benchmark, you'll have a little bit of success there. But at the end of the day, the best way to do this is to understand what are customers really spending time on? What are they looking for? What are they putting in their cart? I often build carts. I know many people do this. They'll build carts of things that they like and then choose from the cart the item they really want to get. What is the combined characteristics of those things? Are they looking at an image? If they are, what are they zooming in on? What do they care about? Oh, they're looking at the connectors on a monitor. That must be important to them. These are all the things that we can learn in real time, and it gets below that sort of top line I'm interested in leather jacket idea. It's like, what is it that I really care about? That's that next layer down. This is where you start to create real differentiation for your customers. The next layer down is conditions. This is by far the biggest category. Why is it the biggest category? Because for each of us, not only do we have different conditions as individuals, individual products that we want to buy have their own conditions associated with them. So for example, B and H does this sort of experience where you can have a video chat with a customer about the products they sell, and they clearly sell these kinds of items. Pro stuff is going to obviously be expensive. So let's say that I'm interested in buying something photography. Well, having a video chat, that could be a condition for me. That's something... you know what? Your competitor... we all know competitors that don't do this, right. For B and H, they don't do that. That's a condition for me and that's a condition for buying. Not only is it important for me, but it's important for me because I want to buy photo equipment. Now I know nothing about photo equipment, Not at all. So if I'm going to buy a camera, I really do need some help here. That kind of an idea. Now my brother coincidentally happens to be a professional photographer. So he knows a lot about photo equipment, He doesn't need this experience, he doesn't need to do a video chat. He's going to buy, but he knows nothing about pro video. I know a lot about pro video. So, that means he's going to probably use the experience in that sort of a journey and I'm not going to use the experience. If you're not connecting the dots, here's what I'm trying to tell you in a nutshell. It's not about forcing a customer down a path. It's about finding certain customer pain points and soloming those pain points for a specific segment of customers, one by one by one. That's how you win markets. Too many companies out there think we're going to do one thing and 50% of the consumer base is going to flock to us. That's never going to happen. The way that you win customers is a little group at a time. When Amazon came out with this idea that they were going to deliver to garages for people's homes, everyone said, Ah, who cares? No big deal. Why is that important? You know why it's important? Because 4% of consumers say, I don't have a safe place to deliver items to my home, so I'm not going to order online. Would you take 4% of the US market? I'll bet you would. Right now, are they going to win a 4% that way? No, but they understand that you don't get to growth by winning 50% of customers in one fell swoop. You win 2% and then you do another thing and win 3%. This is what B and H is doing through this solution. They're going to be able to win a customer that has this need and this condition that the customer says, That's exactly what I needed. Thank you. Here is my money, give me my product. The next layer down is context. Again, this can be very difficult. Why? It's difficult because we don't really know a whole lot about the customer in real time. We're getting there and it's important, but you need to have real time understanding customer to really get to context. Because it matters if I'm in a store. It matters if I'm on my mobile phone. It matters am I talking to someone. Am I using language that is talking about a service or am I looking to buy something. Those sorts of things in a chat bot. There's so many so ways to get to context, but all that has to be reacted to in real time. So it's not the context is hard. It's the real time capabilities that become hard to get you to that state where you can react in the moment to the customer and not misinterpret what they're doing. Because context also requires his historical context. So for example, the context of me buying on a Wednesday night is that I go to a website and I'm looking at something on a Wednesday night. Now let me be clear, I never really buy things during the week. That would be very unusual for me. I tend to buy on the weekends. So if anybody's paying attention to my behaviors, they would say, Well, Brendan's probably not here to buy. He usually takes a lot more time than the five minutes he's spending here looking at our site. So we need to give him a great experience. But don't send him a coupon tomorrow because he'll probably come back this weekend and buy. And they're right. I probably will, and I'll pay full price because I'm an idiot like that. You don't have to buy me right then and there. You can wait because you've seen the context of the moment in relation to the historical context of what I've done. So these are the kinds of things. Again, we're getting some very difficult things at this point and we're getting to the very last one, which is the hardest of all, which is conceptions. This is how I feel about things, which is again, a little ironic that we talk about surprise and delight. Nobody knows if your customers were surprised and delighted that day. You have no idea. If Beth comes to your website, I don't know Beth, but let's say you have a Beth that comes to your website. Are you saying that you know if Beth was happy or sad? Now don't say, Oh well Beth bought, because you and I both know that you've gone to websites that had terrible experiences, and just because you didn't want to waste any more time, you bought from that company, but you're probably never going to buy again. So that's not a good proxy for happiness. More importantly, you have no idea the people you've truly upset that day. Now why is this number six and why do I even include it if we don't know? Because we're right on the cusp of being able to understand customer's emotions in the moment. But that takes computer vision, it takes natural language processing, it takes AI of unstructured data. The ability to do this, to have this sensory component of understanding a customer in the moment. If they're happy or sad, a store associate can do it because they'll have those sensory things. But our digital tools don't really have much of that these days. But if we can get to it, which we are getting to right now, it's an area to explore and keep aware of, but I've just given you so much to work on up to this point. Don't worry about learning if you're surprising and delighting quite yet. There's so many more things you can do to provide value, but keep this on your roadmap and keep a prize of the developments that are happening in this space. Now I said I had to go to some unsexy space and I am, but this is really, really, really important, particularly if you want to make sure your data teams don't leave you and go somewhere else. When you're working on something, you got to make sure the data that you're going after is going to serve a business purpose. I was working with this company one day and they said, " Oh we learned that customers want same day delivery." I was like, Okay, you're a pure play with a DC in the middle of Kansas City. Why do care? " Well, we just wanted to know." I'm like, Okay. So you wasted everybody's time learning something that you could never ever deliver on. So what it is important to understand that there's questions that I'm going to have you take a look at here. If the answer is no to any of these, you should probably rethink if you're going to go after this data, because there's probably no shortage of things you could learn and you're going to create an opportunity cost if you go after something that isn't going to mean anything for your business, but then there's something else that could, but you're not going to go after it. So let's go through the questions. Is the data reliable enough to trust that it represents these customer clearly and accurately? If the answer is no, then don't bother going after it, right? Cause then the positive could be just as likely as a false positive. Number two, can the data be used to directionally predict customer behaviors with a high degree of certainty? Again, this is about measuring business outcomes. If you do something, you should be able to know if it was successful or not. But if you can't do predictability in the data that you're finding, then maybe it's not worth going after that. Again, second guessing yourself a little bit here. These two are big. Number one of the last two is, is the data actual enough to improve our marketing and engagement strategies? Look, if you can't improve your business with something you learn, why are you going after that? You need to be able to say, if we learn that this is true, then here's the things we could do. This is why that Post It exercise right at the beginning is so important, because you have to logically assess that if we learn something, we could do something about it. That's why the X and the Y are equally important. But if you can't do anything about it, like that pure play I was talking about, then maybe don't waste your data team's time in going after that information, because they're going to know that you can't do anything about it and they're just going to get frustrated that you're asking them for information that they know you can't use. The last one is, is the data relevant for supporting our company's priorities, goals, and objectives as a brand? Let me give you a real world right now example of that. I have so many people telling me that they're researching the metaverse, which is fine. If that's what you want to do, spend your time doing that. But then I asked them, Well, when do you plan on launching something? They're like, " Oh, not for years. We're not going to do that." I'm like, Okay, great. Why are you learning about that now then? Why are you spending time trying to understand that? Shouldn't you try to understand why people think your emails are irrelevant? Maybe you should be learning that instead. Work on things that meet your goals and objectives today. If you have unlimited time and resources and nothing else to do, sure you could ignore this last question, but my guess is you probably have more to do than you have time to do it. So I would say make sure you're focusing in, but all four of these are very important. Again, if the answer is no to any of these questions, you might not be meeting the operational guardrails that you need to meet in order to execute on something that you can eventually take action on and, at the end of the day, drive positive business outcomes. So what can you do with all this? Because understanding the customer doesn't have a line on your P and L. No, it does not. That's very true. So what can you do with all this information? Well, you can execute better on the initiatives you probably already have. For example, personalization. Most companies are moving from segmentation to individualization. They're trying to learn about the profile of the customer. They're trying to deliver that one to one relationship with the customer. They're learning about them and understanding them, not their persona, not their segment, but the individual customer is saying, but what does this customer care about? And the only way you get to that individualized state is to be able to learn about the customer at the deep level we've just discussed. Now, I'm not saying segmentation's going away. Let me be super clear. I don't want anyone to be thinking that. What I'm saying is that companies are working towards integrating individualization in the customer journey. You may do segmentation in some places, you may do individualization other places, but the only way you get to that is with better customer understanding. It also helps support omnichannel commerce. You're thinking, what? Why? Well, because at the base of all of omnichannel is the view of the customer. I didn't run out of space left to right on this graphic. The view of the customers at the bottom, because everything else sits on top of it. You need to know that it's Brendan here, here, here, here, and here, along a path to purchase at each touchpoint in order to create a seamless, continuous sort of conversational journey for me where it makes sense. It's a one brand to one customer relationship. But at the heart of that lies that view of the customer and knowing that it's me and knowing what I'm interested and what I'm doing from moment to moment to moment. So really in fact, what's really interesting, and I've recently found out that a lot of companies don't think this way, these two initiatives really have a lot to do with each other. In fact, I often advise our clients that they should be thinking of these initiatives together. But the glue that holds these... rather the function, the mechanism that holds these two initiatives together are the dovetails that lie in the middle of this image here. And that's that view of the customer, the understanding of the customer. So in some ways, one plus one equals three because you're doing one thing for personalization, but you benefit omnichannel as well. So you can end up doing these great sort of understandings of the customer. I just picked two, omnichannel and personalization. There's call center improvements, there's in- store associate tool improvements. There's so much you can do when you learn about the customer. So no matter what initiatives you have, in almost every case that I can think of or that I've come up with, the understanding of the customer, if it's customer facing, can be improved because you understand a little bit about the customer. So the changing reality is you kind of need to take advantage of this and rethink the assets you already have. That's the good news is you probably already have so much of this in place that you can do something about. So first you need to think about your digital touchpoints. So I see so many companies out there developing experiences that occur at the glass, but you know what they don't do? They don't ask themselves, but what could we learn about the customer at this moment? Remember when I said about the Post It note, that this is one step in a multi- step exercise? The very next question I ask the audience to do is say, now where can we learn X? So where is it? Where are these moments? Because if you're building a digital touchpoint that only delivers an experience, you're building half of a solution. The other habit should say, but what can we learn about this customer in this moment? What makes natural sense to be asking or learning through digital dialogues? What is it that they're interested in? Because you already have the ecosystem in place to get to this state, whether it's text messaging, email, e- commerce apps, social media, smart TV, smart cards, smart speakers, whatever it is. Wherever you already have a digital touchpoint, the ecosystem you already have, you didn't think about as places to bring in data about the customer because that's how you get to that image I showed you earlier of that deep understanding and rich understanding of the customer. So this is good news actually, because you probably already have much of this ecosystem in place. You just need to start using it in a different way rather than just delivering experiences. Fortunately, companies today are actually making the kind of investments that allow this to happen. We ask companies, why are the reasons you picked your latest MarTech vendor? Look at what rose right to the top. Ease of integration with other data sources and systems. Look what it beat out though. It beat out standard features and functionality. It beat out ability to service my business needs. That should probably be on top, but yes, it beat out that. It even beat out total cost of ownership by nearly double. So you can see people are starting to realize the value of this connected experience and the ability to bring customer data into the entire organization. Democratize that data and help different parts of the organization create better experiences throughout the customer journey. What I mean by that is unifying that experience. So Sephora does a good job of saying, all right, we learn about you in the beauty station. We can help it build out what happens on the app. We can help develop the experience on the website. Even on the virtual try on, we can understand this. They understand that the experience is interconnected and that understanding the customer in one place allows you to be better at delivering experiences every place that the customer might engage with your brand. Will it get any easier? No, it's not going to get any easier. It's going to get harder. Why is it going to get harder? Because commerce is getting more complicated. The ability to do digital everywhere has become a reality. The one thing I can say about... there's two things I can say about the pandemic. One, we have become channel agnostic. That is absolutely true. We've also become very digitally savvy because we've done everything from doctor's appointments to yoga classes to religious services. Everything has been digitized in our lives and we're become slightly more, if not totally more comfortable with using digital tools to do different things in our lives. So that creates opportunities. Ubiquitous of digital creates opportunities to learn about the customer. But you have to find your own way of doing it. Do I think you should launch a smart speaker? Absolutely not. That's what Amazon chose to do. But you need to find out what it is that you can do to learn about the customer and understand them better and find ways of doing it. Brands are even getting in on this. Airlines are getting in on this. Everybody's getting in on this. The good news is that when companies are doing this, they're training the customer to be even more and more comfortable with sharing data. I'm sure that you as a consumer, if you really think about it, there are times when maybe 10 years ago you'd think it was odd for a company to ask you questions, but this is the experience sitting in a Jet Blue seat where they're asking me, Well, what do I like to do on vacation? Because they're trying to serve the traveler, not just the airline ticket buyer. So as you can see, this ubiquity is really causing us to be more comfortable and used to it. And like I said, brands are even getting in this too. I don't know how many of you know that app in the middle? My wife hates it. I know what this is. Tinder, right? But what is the right place to show me scope? Is it at a Red Sox game at Fenway Park on a billboard? No, it's 30 minutes before a Tinder date, right? Well, it could be flowers if you want to get more pure about it or nicer about it, but whatever. The idea is that what right place, right time, right product. This digital ubiquity in our lives has allowed us to really say, but where's the right place? Maybe I don't need to own the channel. And on top of that, maybe I need to connect into other systems and learn that the customer lives near this 7/ 11. So the customer has a date in 30 minutes. I want to show them scope 30 minutes before the date in the Tinder app and in the app they say, and by the way, that's available at my local 7/ 11. I am not making this stuff up. This is the stuff that people are actually working on today. This is what the future of engagement looks like. It's like inline commerce, the ability to be able to serve customers in different ways. You can see why is it so important to start today? Because it's going to get harder. So your reality, the first thing you got to do, got to get everybody on the same bus. Okay, look, I know you think this is a technical problem. It's not only a technical problem. If you're the one watching what I'm talking about here today and you think others in the organization need to hear it, please share this information, please bring it to them and say, we need to watch this as a group. We need to understand this and learn about it and talk about it, because most companies don't transform, not because of their technical inability, but rather because of cultural problems. Like 53% say culture limits their ability to digitally transform. And over 80%, I think it was 82% of companies said that organizational silos inhibit my ability to transform. You also need the metrics to be able to measure success. So as you can see, it's not just a technical problem. You have to do these things as well. But there are five other things that you need to do going forward that are just so important. I haven't really talked about them here, but they're definitely related to the things we just said. One is reiterating something critically important. Challenge your thinking about what each customer values and why they would actually buy from you. You've got to identify and break those company assumptions, the things that you believe to be true that are just not true. Think of the example I showed you earlier. Number two, don't get too far behind, but also don't get too far ahead of the customer. That might be an odd thing to say. It's like, what about innovation? Look, no one's going to walk into a store this year, look around and go, Oh, there's no virtual reality. I'm out of here. Or no one's going to be standing at the door going, well, that item better come by drone delivery. I'm not ordering from them again. We're not there yet. It's okay that you don't have those things, but we do have expectations of what we need today. So when you can learn about what I value and what I need, you are truly learning my sweet spot of what I want. So you're not investing too ahead of me and you're not investing behind my expectations. Number three is fish where the fish are. In other words, if you're going to learn about the customer and create better experiences, do it where it's going to have the most impact. I see companies all the time where they're improving the app experience, and then I find out that only 2% of their customers use their app. Look, you can do that if you want, but you're going to have better results if you start to improve areas where customers are already shopping with you rather than try to improve areas and trying to get customers to go use that channel, because that's a very difficult thing to do. Number four is don't rush to check that box. Please, please, please don't do that. Again, get rid of the good to great problem and start to get to great and say, You know what? How can we improve this? How can we understand this? What are the metrics we need to know? What's working, what's not? Get rid of what's not working and iterate and improve on what already does. You have to have a clear business purpose and outcome to measure against, or you run the risk of breaking the trust to your customers because you're working on things they don't care about. And you are not going to be able to create that long term loyalty. Finally, if I said it once, I'll say it again, do not focus on trying to surprise and delight your customers. We are not really influenced by that. Future actions are far more influenced by painful experiences then by pleasurable moments. I'm sure many of you drive cars, right? Think about the last time you got out of your car. Did you turn around and go, Oh, thank you car. You're such a wonderful car? Thank you for getting me where I need. No, we don't do that. We expect our car to get us where we need to go, right? We're just fine with it. But if that car breaks down on where we need to go, do we have some choice words for that car? Do we remember that experience? Yes, we will. We are far more influenced by pain than by pleasure. So you know this to be true. If you think about when you have a bad service at a restaurant, you remember that moment. You don't remember the 10 great meals. You remember that one time they were really rude to you. There's so many examples of this in our lives and that's not me. That's every study ever done about it. So if we're really going to create these great, wonderful experiences for customers, we have to learn them. We have to understand them. We have to know them. It is at the core, at the heart of being able to really nail it, no pun intended, with the customer and be able to give them the experiences they want and deliver on our promises of surprise and delight. So thank you very much for your time, and I appreciate your attention.


Digital marketing pro are waking up to the fact that digitally-savvy, channel-agnostic consumers no longer choose who they do business with because of products and services a company offers, but rather give loyalty to those that deliver the "assortment of conditions" under which the individual wants to buy.

In this session, we'll reveal how the exchange of value and real time engagement creates perceivable value and relevancy to each consumer’s buying journey through personalization.

Those that do are better able to win, serve, and retain customers heading into 2023. In this session, guest speaker and Forrester VP/Principal Analyst, Brendan Witcher, will reveal:

  1. What makes customers choose who they do business with (really!)
  2. How a model for deep understanding of the customer is the only path to differentiated personalization
  3. What approaches to personalization cause companies to achieve good, better, and best results
  4. Why data and personalization are keys to unlocking potential of your loyalty programs and marketing
  5. Which companies are successfully using data and advanced levels of personalization to win customers today