The Power of Personalization in the Age of AI | Mark Abraham | TED

What is True Personalization in Customer Experience?

The Incident and Initial Thoughts

• A personal anecdote begins with the speaker being attacked by a dog while running, leading to a visit to urgent care.

• The speaker reflects on the frustrating experience of filling out forms at urgent care despite having been there multiple times before, highlighting inefficiencies in customer service.

• Examples of poor personalization are shared, such as irrelevant email recommendations for deceased pets and inappropriate ads based on past purchases.

Understanding True Personalization

• The speaker emphasizes the need for brands to provide better customer experiences through true personalization rather than mere customization.

• True personalization involves using insights from previous interactions to enhance future ones, making them more efficient and relevant.

Measuring Personalization

• Introduction of the "personalization index," a scoring system (0 to 100) that evaluates how well companies personalize their services.

• Notable companies like Netflix and Starbucks score high on this index due to their effective use of customer data for personalized recommendations.

Impact of Personalization on Growth

• Companies at the bottom of the index often belong to industries like financial services and healthcare, indicating widespread issues with personalization.

• Research shows that companies excelling in personalization can grow significantly faster than their competitors, capturing substantial market opportunities.

How Can Brands Implement Effective Personalization?

The 'Less is More' Approach

• A key finding suggests that effective personalization means reducing unnecessary communications—fewer ads and offers lead to greater trust from customers.

Case Study: Fidelity Investments

• Fidelity exemplifies successful implementation by genuinely understanding client needs through personalized surveys and one-on-one meetings.

Benefits of Personalization in Customer Engagement

The Shift to Personalized Communication

• Companies are moving towards personalized communication strategies, such as offering tailored educational content based on the customer's investment knowledge.

• Fidelity's approach involved reducing generic outreach and focusing on triggered, personalized messages, leading to increased customer engagement and opt-in rates.

Impact on Business Transactions

• Contrary to concerns about reduced transactions from less spammy communication, Fidelity experienced an increase in brokerage transactions with their new strategy.

• Despite this success, only 10% of companies are considered personalization leaders, indicating a widespread issue in effective customer engagement.

The Problem of Spam and Content Overload

• With 360 billion emails sent daily and declining conversion rates, businesses face challenges in capturing consumer attention amidst content saturation.

• Consumers are more willing to share data when they receive personalized experiences; personalization can increase data sharing willingness from 30% to 90%.

Consumer Empowerment and Feedback

• Customers should actively communicate dissatisfaction with brands through feedback mechanisms like surveys to improve digital relationships.

Underlying Issues of Impersonality

• There is a growing sense of anger among consumers towards large corporations and government entities due to feelings of being unheard in an impersonal world.