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Opinion: The Power of ‘You’

The potential impact of personalised marketing over the web is enormous, but companies must move quickly to seize the opportunities presented by a truly integrated multi-channel sales and customer services strategy, says Mark Simpson, Founder and Managing Director of Maxymiser.

As businesses increasingly focus on ecommerce as a means of driving new revenues, Amazon continues to be a great example of best practice, in terms of its sophisticated ability to recognise and deftly exploit consumer’s browsing and buying habits – contrasting with most other web sites, which still struggle to make full use of the wealth of customer data they have access to.

Of course, Amazon has the advantage that its route to market is one-dimensional, being 100% web-based. For most online businesses, this is just one of several channels – but therein lies the challenge. As hard as some have worked to blend their operations and business data across their bricks and mortar, call centre and web operations, plenty of gaps still exist – and it’s customers who are slipping through the cracks.

Failure to join up customer relationship management (CRM) activities with online visitor behaviour is a colossal waste of an opportunity. It also leads to frustrated and disgruntled customers who have to keep spelling out their details and preferences as they switch between channels.

For the business, it means failing to register that, for example, the car insurance customer on the phone was browsing life insurance offers yesterday.

An oasis in the recessionary desert

The web is the only sales channel to have grown during the recession, while high-street business has contracted significantly. It is now such a powerful, commanding route to market that, in some pre-Internet sectors, over 90% of business is now done online. One of the best examples is the airline industry, where players like EasyJet that would once have conducted most of its activities using call centres, now handles 96% of its transactions online.

Yet, while Internet businesses have come a long way in catching up with their more traditional sales outlets in terms of the breadth and sophistication of their product ranges and the way these are displayed online, they have failed to join up their CRM activities, which limits their impact as they try to personalise promotional offers.

Steps are being taken – it is now quite easy to mimic Amazon’s highly successful activities with returning customers (‘Here are some personal recommendations based on your last purchases’) – but they are not going far enough.

Take a bank, which, through its branches or via direct mail, might use its customer relationship management (CRM) system and propensity modelling to address gaps in a customer’s portfolio of financial products, to suggest an upgrade to a new account, an insurance policy, or a favourable new credit card rate.

What if that same bank was aware, though, that a customer had visited its mortgage calculator facility the last time they were on its web site? This would present a fantastic opportunity to make a timely, customised offer, even having this as the focal content of the landing page shown to the customer next time they are online to transfer money or pay a bill.

Financial services leads the way

These are the opportunities now being investigated by the financial services industry in particular, which has become the first sector to seize the opportunities presented by a truly integrated multi-channel sales and customer services strategy.

The retail and travel sectors are hot on their heels however, as well as the media industry, including the newspaper groups, which have been struggling to redefine optimal business models. The ability to adapt what these organisations show people according to their known preferences could be a powerful tool in building and strengthening their customer bases as they shift online, particularly if this can be dovetailed with offline activities.

The potential impact of personalised marketing over the web is enormous. Not only is the web responsible for the strongest growth in sales recently, it has also been responsible for making customers more fickle than they have ever been before. This flightiness presents a risk (of losing customers easily), but also a significant opportunity (of impressing them by doing something different and special, thereby luring them away from the competition).

The reality is stark. E-business owners have about seven seconds to capture the attention of an online visitor and engage their interest. If this opportunity is lost, the customer will move to a competitor. If they experience more relevant, personalised content and a pertinent offer there, they may never come back – however loyal to the brand they may have been previously.

Joining the dots

It is imperative, then, that companies join up their customer data across all of their channels, so that branch staff know what customers have been doing online, and web pages work as an extension of interactions that may have begun elsewhere.

Although the majority of organisations appreciate the value of doing this, only a tiny minority have followed through. Market analyst firm, Forrester, notes that organisations have wanted to personalise their web marketing for as long as 15 years: what’s stopped them is simply that they haven’t known how to go about it. But now the building blocks exist to get them started – allowing them to model what customers do as they navigate a site’s web pages, and segment this data so it can be exploited in tailored promotions both on the web, either during a current or future session, or across other channels. Nirvana is a fully joined-up CRM solution that feeds into specific online offers.

As with all of these opportunities, the danger is that by hanging back and seeing what others do first, companies risk losing the advantage to the competition, whose better developed personalisation capabilities may have enabled them to move swiftly and offer a killer deal.