Poorly-targeted and unrelated marketing materials are driving customers away from their favourite brands, according to new research by AI marketing experts Emarsys.
Its survey of more than 2000 UK consumers, published today, reveals how far brands are from being able to deliver on the promise of marketing - that of true personalisation or individualisation, at scale - with only 6% of consumers believing the product and service offers they receive are specifically relevant to them.
Poor attempts at personalization are having an adverse impact on customer experience. An alarming 2 in 5 consumers (41%) swear they won’t purchase from a brand again if they receive haphazard marketing materials, causing irreparable, long-term damage to thousands of brand-customer relationships. Over 60% demand that offers they receive be tailored to them and their interests precisely, so it’s no surprise that two thirds (66%) admitted they would ignore all future marketing from a brand if it sent them hit-or miss offers.
While the findings indicate brands are struggling to get the formula right, they also demonstrate the market opportunity for businesses that put personalization at the heart of their strategy and provide more tailored content to consumers. When it comes to customer loyalty, over half of respondents (57%) admitted they would be more likely to repeat purchase if they received more loyalty-based discounts from a retailer, while 41% would be more likely to buy from a brand again if they received bespoke offers which were truly personalized and unique to them.
The problem that most brands encounter though is that human-driven personalization just doesn’t scale. That is, segmentation and personalization designed and executed by marketers doesn’t provide the level of individualization, at volume, that consumers demand. However, for marketing departments and brands that are mature enough and ready, AI and machine learning can scale to audiences large and small, as it learns the preferences of each individual and tailors accordingly.
Whilst there is a lot of hype around AI and machine learning, the study illustrates that consumers generally have few hang ups on the subject. It reveals that consumers are not concerned about being marketed to by AI, provided it improves their customer experience. More than four in five (82%) are now aware of the use of AI in their shopping experience, and almost half (47%) are happy with brands using the technology instead of humans to personalize marketing experiences, if it improves the offers and recommendations they receive, with a further 43% indicating they are happy with it being used to determine what discounts they receive.
The research also showed that email (60%) is still by far the preferred channel for consumers to receive offers and recommendations, ahead of post (23%) and social media (19%).
Discussing the results at Emarsys’ global client event, Revolution, Grant Coleman, VP and Market Director for UK and Nordics at Emarsys, said: “Personalisation is the Holy Grail of good marketing, but what’s clear from this research is that marketers’ current, human-driven approach simply doesn’t scale, leading to irrevocably damaged relationships with customers and ultimately churn. Additionally, while marketers are grappling with making sense of data sets and tech stacks, they are not fully focused on developing distinctive creative content, the sort that delights and differentiates. AI tips this balance in their favour, doing all the legwork so that communication is always tailored across every channel along the purchase lifecycle, eliminating the risk of upsetting valued patrons.”
Rajan Balasundaram, Vice President, Solutions and Strategic Services at Emarsys, added: “Brands that can make full and fast use of the data and technologies available to them will not only provide consumers with far more individual customer experiences, but also ensure they as marketers reap the full benefits of the systems they have invested in. As this study shows, consumers aren’t fussed about what’s feeding the machine - they just want a shopping experience which works for them and provides value to their individual needs.”
About the research
This research of 2,002 UK consumers was conducted by Opinion Matters on behalf of Emarsys in August 2018. Opinion Matters abide by and employ members of the Market Research Society which is based on the ESOMAR principles.