What’s behind the rise in personalized products?

Custom shoes, personalized drinks and special menu offers. In a world where carbon copies of products are everywhere, retailers have to make their products stand out and provide customers with a unique shopping experience.

The need to differentiate is even greater when consumers are cautious about their spending. Businesses have to work harder as they compete for that all-important dollar, so price wars among retailers are common.

PersonalizationInternational business magazine Forbes has listed customized products and personalized services as one of the ten biggest business trends of 2024.

It’s clear—and has been for years—that personalization appeals to consumers who want to care about and understand their favorite brands. In fact, they are ready for consumers Pay more for experience.

How businesses learn what customers want.

Companies are increasingly using what marketers call Personalization at scale By analyzing large amounts of data about individuals to provide products tailored to their specific needs, behaviors and preferences.

This historical and Real time data Consumers’ online shopping and browsing behavior, use of mobile apps, internet searches, online shopping carts and Brand loyalty Cards

E-commerce retailer Amazon personalizes product recommendations based on customers’ browsing and purchase history, offering them items they’ve bought or at least seen.

Similarly, entertainment streaming platforms Netflix and Spotify analyze their users’ viewing and listening history to understand their preferences and recommend new content.

Coffee giant Starbucks interacts with its loyal members through games. Mobile app and rewards loyalists with exclusive offers and exclusive product trials. Games are personalized for each user based on data collected from their past visits and interactions with the app.

of coke Share a coke. The campaign, launched in Australia in 2011, was a successful example of the bond brands can create with consumers simply by adding a person’s name to the product.

gave Company branded Its bottles and cans are branded with 150 of the most famous names in Australia and urges consumers to share a Coke with someone whose name is emblazoned on the label. The list of names was later expanded.

L’Oreal’s The most recent innovation is their in-store technology that digitally scans each customer’s skin. The data obtained is used to create a customized foundation (from 72,000 possible combinations) to match an individual’s shade, hydration level and desired coverage.

Nike produces custom shoes in thousands of styles, colors and icon combinations as they continue to acquire data integration platforms that help accelerate the collection and analysis of consumer data.

Consumers want more from their shopping experience.

In the pre-digital era, personalization was based on broad demographics and direct consumer feedback. This often results in personalized store interactions, or tailoring store services, between salespeople and VIP customers. Personalization was only affordable to the high net worth.

But the digital age has made personalization accessible to all consumers, not just the elite. Today’s shoppers expect unique experiences and will vote with their dollars. It is supported. research Showing personal experiences increases company sales.

gave The Covid-19 pandemic Personalization only became more important for companies as consumers switched to new stores, products, or shopping methods, proving brand loyalty was a thing of the past.

Consumers now expect more value from brands. They want to feel recognized and understood on an individual level and not part of a crowd. Personalization at scale allows consumers to feel empowered with their choices. This feeling of Psychic ownership Designing your “own” product can result in greater value and brand value. love.

Why Personalization Works for Big Brands

Personalized offering companies at scale Many benefits. This can reduce customer acquisition costs and increase revenue. Personalized experiences, when offered to millions of consumers, are difficult for competitors to replicate, especially when brands use proprietary technology.

Personalization also means less waste because brands produce what consumers “really” want rather than what they “think” consumers want. After all, consumers who seek products that are unique to them are less likely to part with something they perceive as their own creation.

However, using predictive algorithms to help brands analyze past behavior (what you and others like you have bought/seen) and come up with choices (at scale) can be imperfect. Is.

Dating app Tinder’s reliance on algorithms to decide which photos users see has been criticized. poor “Swiping right,” with very low mutual interest rates between users. Understanding human behavior requires intuition as well as algorithms.

If personalization isn’t new, why the sudden hype?

Brands are increasingly embracing digital disruption. The digital revolution brought an influx of consumer data, but despite early algorithms, it was difficult for companies to make sense of the vast amounts of raw data.

Artificial Intelligence (AI) and Machine learning It has revolutionized brands by making them usable. AI-powered methods To understand our customers and present relevant content. In return, users get to contribute to the design of their products.

Big brands like Nike and L’Oreal have the right formula for personalization and their customers are enjoying a unique experience. That’s good news for big brands with big budgets and access to data, but for smaller brands with fewer resources trying to capture customer attention.

As AI technology advances, we will begin to see. Open source software With publicly accessible data that allows even the smallest brands to access and learn how to customize each experience.

This article has been republished. Conversation Under Creative Commons License. read Original article.