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Sep 14, 2021

Gift Wrap a Personalized CX for Consumers this Holiday Shopping Season

While there is still about a week to go until the official start of fall, it is never too early to start thinking about holiday shopping. With the approaching change of season a tipping point for many to start thinking about the holidays, Redpoint set out to find out what is top of mind for consumers. In a survey of more than 1,000 U.S. consumers conducted by Dynata, new research found that a personalized omnichannel customer experience is high on consumers’ wish list.

The overwhelming majority of consumers (80 percent) agree that they are more likely to shop with brands that show them they understand their needs by sending relevant, personalized offers this holiday season. Because dynamic customer journeys are now the norm, with consumers interacting with brands across multiple channels and engagement touchpoints, relevant personalized offers must be understood to mean that a brand possess a deep understanding of individual customers. A deep understanding, in turn, means knowing everything there is to know about a customer – preferences, behaviors, devices, household status, social footprint, transactions, etc. Importantly, customers expect this deep, personal understanding to be consistent across channels. In the survey, 78 percent of respondents reported being frustrated when a retailer’s communications and marketing messages are inconsistent depending on the channel they visit (in-store, online, social, call center, app, etc.).

Survey findings also validated that dynamic customer journeys are indeed in fashion this holiday shopping season. Only small percentages of consumers said they will shop exclusively online or in-store this season (8 percent and 16 percent, respectively). Conversely, 27 percent of consumers plan to shop equally in-store and online, and 29 percent said they will conduct online research followed by in-store evaluation and purchase.

Unwrapping the True Meaning of Personalization

What does the research portend for brands aiming to deliver consistent messaging in line with consumer expectations? Importantly, there can be no data siloes between physical and digital channels. Consider, for example, the fallout if a team responsible for website personalization makes a personalized product recommendation for a known customer – based on an online session – when there is no integration with the physical store. If the consumer is one of the nearly one-third of consumers who said they will conduct online research followed by an in-store purchase, they may be frustrated if the recommended product isn’t available at any store in their vicinity. If the brand knows where a customer lives, and knows the customer frequently starts a journey online but completes it in-store, recommending a product the consumer cannot easily purchase with a quick trip to the nearest store will create friction in the customer journey. (Consumers ranked out-of-stock items as their No. 1 frustration when holiday shopping.)

Alternatively, let’s look at the type of personalized experience (using a product recommendation engine as an example) that is possible with the deep, personal understanding that is reflected by consistent messaging across channels. Perhaps an online session starts from an unknown device. Yet through advanced identity resolution capabilities that combine probabilistic and deterministic matching, a brand knows almost instantly the household dynamics from where the device is being used. Based on the session activity that is consistent with a member of the household, the same matching capabilities let the brand know who is using the device.

Now it is a known customer journey. If, instead of data siloes, the website personalization team has access to an instantaneously updated, unified customer profile, it will know the customer recently called the contact center to inquire about a recently discontinued product.

With automated machine learning, intelligent orchestration and a real-time decisioning engine running behind the scenes, the recommendation engine generates products that are hyper-personalized for the individual consumer. This is a key distinction between token personalization and the deep, personal understanding that customers expect – and respond to. In the former, a product recommendation engine may recommend a product that customers who bought the discontinued product also bought. Or, because the customer is a woman between 35-49, the recommendation engine offers products that women in that broad segment generally favor.

Advanced personalization through automated machine learning eliminates the need to rely on look-alike audiences, assumptions or other arbitrary associations. Instead of static rules, next-best actions – in this case real-time product recommendations – are based only on what the data say is important. A hyper-personalized product recommendation might be scarves that match color choices and styles expressed in a loyalty survey, or a selection of limited-edition kicks for someone identified as a sneakerhead. The living, breathing, real-time unified customer profile that is unique to each individual – a golden record – lets marketers or any business user know why a specific customer is associated with a certain audience cluster. When rules are derived from the data – and not hard-coded – marketers are able to orchestrate next-best actions to customers with minimal presumptions. Also in line with customer expectations is the fact that a recommendation – or any personalized experience – is delivered in the cadence of the customer, which means that it is in sync with the dynamic nature of a customer journey. Real time – whether seconds, minutes, hours or days – is defined by how and when a customer chooses to engage with a brand, which makes every action appear perfectly timed with an individual customer journey.

Paying More for a Personalized Experience

Additional survey questions polled consumers about privacy concerns, the impact of global supply chain challenges and shopping preferences. As for preferences, 60 percent of consumers said that they will use a buy online, pick-up in-store model (BOPIS) this holiday season, showing again that combining the digital and physical shopping experiences is becoming more a rule than an exception.

One interesting finding from the survey gets to the heart of what the possession of a deep, personal understanding of the individual customer really means to retailers from a monetary standpoint. Two-thirds of customers (66 percent) said they expect to pay more for gifts this holiday season, and 37 percent of those consumers have budgeted for an expected increase. It stands to reason, then, that if consumers are ready and willing to pay more they will be even more inclined to divert that business to brands that show they understand their needs.

A bountiful holiday for retailers, then, depends on delivering the level of personalization that customers have come to expect. An omnichannel customer experience starts with knowing everything there is to know about a customer, and an understanding that from the customer’s perspective a holistic experience feels as if they’re being communicated to with one voice – irrespective of channel or engagement touchpoint. That is holiday magic.