One time, as a high school student in Mandan, North Dakota, I received a bunch of offers to buy a condo in a 65+ community in Arkansas. I felt slightly bad for this real estate developer who couldn’t bother to apply basic age segmentation to the marketing list he bought. As it turns out, my best friend had submitted my name as a joke, indicating my interest in purchasing a condo…and he lied about my age. Super funny, Shawn!
Oh, how far we’ve come! The idea of applying basic age-gender-geographic segmentation to a direct mail or email list seems so rudimentary in the context of more modern data science techniques. Today, companies are serving up offers, content, and advertisements that seem to fit consumers’ own unique blend of preferences, past purchase behavior, and even future desires.
Show me the money!
It’s no wonder why. Let’s review a few key findings from a recent report by The Boston Consulting Group:
- Personalized experiences, powered by technology and data, drive revenue increases of 6-10%
- $800 billion is up for grabs over the next 3-5 years for companies who successfully create tailored brand experiences
- Half of the survey respondents spend > $5 Million / year on personalization campaigns
- Most “personalization leaders” are tech companies and digital natives
You might be thinking, “I can’t compete with that!”
Yes, you can!
There has never been a better time for companies of any size to use data science and machine learning techniques to power more intelligent, beautiful brand experiences for their customers. You absolutely are ready to use data science to capture your fair share of that $800 billion-dollar pie.
How might we?
At Sprocket, we view the future through the lens of “How might we…?” In this case, how might we use data science and machine learning to create an individualized experience for your customers? Here are 3 ways:
1. Loyalty programs – Customer loyalty programs have been around for long enough that we now have empirical evidence to support them. Well-designed programs can generate positive results for companies (e.g., repeat purchases, larger lifetime value, increased revenue, reduced defection rate, etc.).
There are countless ways to reward consumers for their engagement with your brand. Why not reward them in a way that resonates with them? It’s one thing to offer a wide variety of ways for a customer to redeem their loyalty program points, but it’s gangbusters to remove the friction of making that decision by proactively suggesting a redemption that is likely to resonate with an individual customer.
At Sprocket, we have over 2 decades of experience in creating and revamping highly successful loyalty programs. We’re also highly skilled at state-of-the-art data science techniques. We’ve seen firsthand the power of matching the right reward with the right customer. We’d love to help you realize the full potential of your loyalty program.
2. Customer Service – What was your worst customer service experience? How about your best one? What differentiated them? As a customer, what is the value of feeling heard and understood? How frustrating is it to have your customer service experience draaaaawn oooouuuut because a representative is suggesting irrelevant add-on products and services? How amazing does it feel when a company suggests that last missing link that helps you make the most of the product or service you’re buying? Data science techniques can help you understand your customers at a deeper level, which allows you to make intelligent suggestions and provide a much more tailored customer service experience.
At Sprocket, we call this the “holy grail.” Our proprietary method combines customer persona development with unsupervised machine learning to uncover customer motivational and behavioral segments that can be fed right back into your CRM.
3. Brand Experience – How do you get your customers to branch out and experience the breadth that your brand has to offer? So many times, customers are “one-and-done,” or they stick to a narrow band of products or services your company has to offer. How do you get them to move out of their comfort zone to try something new?
We pair empirically-supported behavioral economic techniques with custom machine learning recommender engines to create a powerful mechanism for guiding customers deeper and broader into your brand, without pushing them too far out of their comfort zone. There’s nothing we Sprocketeers like more than to combine 2 seemingly unrelated types of nerdiness to create something magical.
Let’s do it!
There’s $800 billion up for grabs. Some of that should be yours! We believe that our combination of imagination, design thinking, and data science can help any company move toward a more individualized customer experience. Let’s do it!