personalised service retail

Offering a personalised service in a small business is relatively easy. I have a local cafe close to where I live and I’m always pleased that they serve me coffee exactly the way I like it even before I ask for one. They know my regular order and just serve it as soon as I walk in – perhaps one day I would like a change, but it’s never been a problem yet!

But how can companies scale up this kind of personalised service? Knowing exactly what a customer usually likes or dislikes and being able to offer products that you know the customer will want; it’s one thing in a small cafe, but what if we apply the same need for personalisation to a national retailer?

The Harvard Business Review (HBR) recently published research indicating that companies that working on personalising their marketing outreach to customers achieve a return on investment (ROI) of five to eight times the same spend that is not focused on personalising the service. That’s an enormous difference for one single change in focus.

The big difference today is that it is finally becoming possible to really interact with customers in a way that is more personal. Previous efforts really just involved large-scale surveys, analysis of the results, attempts at implementing the feedback and then a repeat of the same processes. Today the possibilities to deliver reliable personalisation are far more detailed. Look at the “three Ds” outlined by HBR:

  • Data Discovery: a wide range of data can be drawn on to define the profile, interests, and needs of individual customers, allowing far more insight into when and what individual customers might purchase.
  • Decision-making: standard data models used to pump out discounts and offers based on products or regions – now more complex decision-making tools can drill down and create offers that are attractive to individual customers, based on their profile and history.
  • Distribution of content: content can now be distributed to customers using demographic and geographic filters easily. It’s even possible to filter specific “types” of customer who are presently located in, or close to, a retail store.

There is a technological revolution taking place that is allowing large companies to mine data and make decisions on what to recommend to customers, or which discounts to offer – and all of this decision-making can be focused on the preferences of the individual. Never before has this level of personalisation been possible. We are in an environment where huge national retailers might soon be able to offer a more personalised service than your local cafe. Who would have thought that this could be possible?

What do you think of the HBR three Ds? Leave a comment here if you have any ideas, or get in touch on LinkedIn.