Picture the following situation: you are the marketing manager of a construction company, and you are in charge of designing the launch campaign for your newest development: apartments from 70 to 120 square meters, well located in Rio de Janeiro, close by the sea and with a view to Copacabana fort. Working with your agency, you design 3 different approaches when deciding where to allocate most of the budget dedicated to the campaign:
1 - They buy ad spaces on TV Globo, at peak hours, to impact as many people as possible. After all, the more people are exposed to it, the more chances there is of someone being interested.
2 - They decide to work in partnership with luxury, fashion and personal finance micro-influencers, creating organic ads on their podcasts, YouTube channels and social networks. You end up impacting fewer people, but get a more assertive audience.
3 - Through a layer of Artificial Intelligence and Machine Learning, it creates a personalized CRM for the base of potential customers that you have stored, offering the best plan for the requirements of each one through a predictive algorithm, and dynamic price based on power purchasing.
Which option you choose?
I believe option 3 is the on to go. Even if option 2 is somewhat good because it already targets an audience with potential, it doesn't personalize the offer - which we know is what any customer wants nowadays: a perfect offer for your tastes, at the right time, and at the right price. And since we're talking about customization, this is precisely the main theme of today's episode - a theme that Bozoma is a great expert on.
Bozoma Saint John is the Chief Marketing Officer at Netflix, formerly Chief Marketing Officer at Uber and Apple, and is a self-proclaimed "badass", as the new course she's teaching at Harvard Business School is called "Anatomy of a Badass"….to sum up, she's amazing!
In terms of marketing, she is perhaps the world's greatest reference, and when we go deep into the hottest discussions about marketing, we will always get to the point of "personalization or customization". After all, as consumers we have always wanted to be treated in a unique way, but until Digital, Big Data and Artificial Intelligence came together, we were unable to communicate in a customized way with the customer. Thinking about TV ads? Well, Bozoma has very strong and clear opinions about personalization, and she tells us all about it in the next sentence:
“Personalization is the key: I don't care if it's an SMS, an email or Facebook ad, if you don't customize it for me, well, I don't want to see that. I'm a "let's not do that massive marketing" kind of thing. (INTERVIEWER) Do you think this is one of the main vulnerabilities of TV commercials? They try to reach everybody and in the end they reach nobody? (BOZOMA): Absolutely: TV ads, billboards, all types of mass media, they must be the anchor. That is, when I have your attention thanks to them, then that's when I have to speak because this is important to you. That's why SMS, email, and social media, and anywhere where it can be more personalised, it helps to cut to the chase in how I communicate with you."
Let me start by telling a story that happened to me. A few years ago, when I was still working on Tinder, I signed up for the Nubank card. I was super excited to receive it, as I admired the work that David Velez, Cristina Junqueira and the team were doing - and I'm a fan to this day, even more so now with Anitta on the board, which I thought was a great insight, whether in terms of marketing and of Branding insight.
By the way, let me open a parenthesis here: I see many parallels between Anitta and Bozoma, you know? One goes a lot into the other's territory, that is, Bozoma is not a singer but she is a great marketer who loves pop culture, and Anitta is a singer who loves marketing and knows how to do it better than many Communication undergraduates. They are both badass, empowered women. What Anitta is doing in the Brazilian marketing sector, such as innovating in collaboration formats with brands - for example, becoming the creative director of Skol Beats - in addition to building her own personal brand, is extraordinary. I can confirm Anitta's incredible marketing vision for having held a meeting with her years ago, and I think that today I can count on it without any problems, to discuss a campaign for Tinder where she would assume a relationship with her on Tinder. We already know that Anitta's love life doesn't have much room for dating, right, and that's why the campaign was lost, but since then I've only admired her ability to understand the new marketing. Closed parenthesis.
Back to our story, I applied for a Nubank card, but it was denied. I received a response email that surprised me, which said that I did not meet the criteria. I admit that I was initially worried, because maybe Nubank knew something about my financial life that I didn't even know, but then I got upset and wanted to understand better about the card approval algorithm. Anyone who follows me here knows that I'm very active on Linkedin, and that's why I posted about my rejection, asking if anyone knew the reason for that denial. The result? There were thousands of likes and more than 500 comments from people saying that the same thing had happened to them too, sharing their theories about the algorithms with me, and so on. In other words, a great social media engagement. But that's not the story, the story is about what happened the next day.
The next day I received an email in my inbox with the title: "Andrea, it's a Match". The sender was Banco Neon, a competitor of Nubank. The email said: "Hi Andrea, how are you? I heard that someone swipe left on your credit card order. It's their lost, at least that's what I think . My name is Neon, etc etc etc, and it ended with a Call-to-Action button with the words "If it matches, click and open your account". Needless to say that I rushed to post on LinkedIn about this, with the following caption "Banco Neon, please do promote whoever sent me this email". The post went viral on marketing Whatsapp groups. I even got to meet the guy who wrote the email, and whether or not he was promoted I don't know, but the fact is that on that moment he was a marketing genius that knew how to customization + speed and generated connection and engagement. The result for Neon was a spontaneous buzz without having spent a dime, but only thanks to the personalization of a email, which made me connect more with them than with Nubank, while encouraging me to share as it was so unique and original.
The truth is that, as people and consumers, we have always wanted to be treated in a special, unique way. Why do you think Starbuck puts our name on the cup? Personalization, of course, and in terms of brand love and spontaneous social media posting, they far surpass Dunkin Donuts, their biggest competitor. In the digital world, personalization can be in communication, just as in the example above, but it has a big problem: doing it individually and manually, as in the case of Neon, it is something doable with some customers, but how do you do it with hundreds of thousands of customers as in the case of a retailer, or with millions as in the case of a bank or a telecom company? That is the great challenge of today's world. How do you customize to the fullest on a larger scale? We do know that technologies such as Artificial Intelligence and Machine Learning, coupled with sophisticated data collection technologies, such as WiFi 6X by Oi Soluções, which was recently launched and helps shopkeepers to measure everything that happens inside their stores, tend to help us enormously.
But before that, let's start the discussion by understanding why personalization is so important in business today. Fundamentally, it's because personalization leads to relevancy, and relevancy is the key to competing in an overcrowded marketplace. Where does relevance start from? It starts with the ability to engage people in a personalized way: only then can you connect in a deeper and more human way with them. At Coveo's Relevance 260 conference, Bozoma Saint John and another great marketer, Seth Godin, had an extraordinary conversation about personalization, it was one of the best events I've ever attended. Godin said we need to serve people in individual ways - by responding to what they know they want and anticipating their needs. The personalization of the online experience is becoming the personal physical experience, he said, that is, consumers increasingly want to enter a physical store and have a personalized experience there too, in a true omnichannel. And this overlap between worlds is happening in the other direction as well - they want the digital experience to feel more like the physical one. He teased the panel: “In the online world, which is inherently two-dimensional, what do we do when someone comes along? Do they feel welcome? Do they feel like they are in a store? Do they feel respected? Are we treating them with dignity? Do they feel like you are customizing the experience for them? We can actually do a lot of these things with technology."
To deliver the experience economy, companies need to use data to serve people in very personalized ways. This requires a balance between privacy and personalization, as companies not only collect data, but analyze it to meet personal experience expectations. The personalization kind of freaks people out, because if you walk into a store or an e-commerce store that you've never been in and they know your name, you're like, 'Holy crap, how did that happen? 🇧🇷 Relevancy is the key to removing that unpleasant feeling because when it's personalized it's what the consumer wants. Relevancy changes the experience to deliver exactly what the consumer wants. Seth Godin put it very interestingly, "It's not about them, it's for them."
And you can see that personalizing the experience positively impacts the business: a recent statistic from Accenture points out that 91% of consumers say they are more likely to shop with brands that provide offers and recommendations that are relevant to them, while another from Adobe said that 66% of consumers say that encountering non-personalized content would deter them from making a purchase. Adweek has shown that personalization can reduce customer acquisition costs by up to 50%, and can increase the efficiency of marketing spend by up to 30%. In other words, personalization is everything we want, and everything that the client and consumer needs. Now think about a marketing model where ads on TV are completely massive, and where you still have to deal with advertising breaks, where most people tend to switch channels. Think about Instagram and Facebook feeds: if we are impacted by an ad that is not relevant, we just scroll down. Obviously it is not assertive, on the contrary: it pollutes, stresses, frustrates the consumer, as we receive offers for things we don't need. For example, you don't have a pet, but you keep being exposed to pet food promotion in the ecommerce where you are registered? It happens all the time! And it reminds me more of a fishing session with a net, where you throw a net and see who lands in it. Segmentation and clustering are ways to make marketing less massive, but that's still far from personalization.
The new marketing as we've seen it is personalized, but we still have to address the big problem: how do we scale this into huge customer bases? Well, our old friend Artificial Intelligence and our old friend Machine Learning are going to help us with that. Artificial Intelligence can leverage many variables that reveal how, when and what customers buy things. Variables can include factors such as contextual data, behavior, demographics, expressed interests, customer reward programs, seasonal data (such as Christmas and summer trends) and even information about the local weather, while Machine Learning can identify patterns - such as customer needs - build on that and use them to make predictions. And finally, ever-increasing GPU-based computing power allows us to build increasingly complex (and often more accurate) models for a wide variety of tasks. Take this case: Hilton hotels, for example, uses a robot concierge named Connie to make guest experiences as personal and enjoyable as possible. This two-foot-tall robot is in the lobby to greet guests and answer questions, in some units. By knowing which guests are entering the hotel, these robots can learn over time to greet and provide more specific services based on the user's personal preferences.
That is, in general, we have seen that personalization is fundamental for the business since it is fundamental for the customer, and that today with the combination of Big Data, Artificial Intelligence and Machine Learning, it is increasingly assertive as it is climbed. Why? Because the more interactions, the more the machine learns.
That's why I want to leave you today with a practical challenge: choose a variable related to your customer (it could be name, price preference, it could be size if you're selling clothes), and make sure you're personalizing the experience for him or her. Ask yourself: am I communicating with him or her always taking this variable into account? Am I displaying suggestions based on this variable? If I'm not doing this, what further process or technology can I use to introduce this personalization element?
Think about it as homework, and tell me later at @aiorio_br.
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