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Please don’t take it too personally

09. July 2016, Editorial

Retail is focused on personalisation. It’s often good, sometimes bad, and now and again totally ridiculous.

Thema:

Personalization
Trade

They know our names, know when we’ve moved to another city and where we would like to go on holiday next. It’s sometimes creepy how accurately businesses know about us and our habits. Sometimes it’s even shameful: when a retailer sends coupons for chocolate because one of its data analyses spits out the customer’s relationship breakup. Personalisation done well or overdone – businesses walk a fine line. Because many customers want to receive individualised offers, but they don’t want to feel like they are being stalked. Retailers, in turn, want to optimally use the data they collect but can forget respect and distance in the process.

Personalisation is a fine line. It can quickly become too much. But too little is also not desirable.

Personalisation functions best when it is not obvious. Customers use discounts and sales offers without thinking a lot about it, they’re just pleased to have the right voucher. Sandra McDill of iProspect, a giant marketing company, says: “Good personalisation should be helpful and honest. It leaves customers with a positive feeling about the brand and ensures that the customer allows further data collection about him or herself”. Sensibly handling the data is, however, essential. According to a study from 2015, 60 per cent of American customers receive real-time promotions but only a fifth want to reveal their locations. A whole 90 per cent want to be able to limit the information they share and prevent it from being shared with third parties. Almost exactly as many would like to be able to determine how their data is used themselves. This control over one’s own buying profile is a good way to meet everyone’s needs. Also recommended: Explaining how recommendations come about. Amazon.com does this for instance. By clicking on “Why recom­mended?” customers can find out why certain products were recom­mended to them.

Customer want real-time discounts, but don’t want to reveal their location.

The retailer Target, by the way, has developed a particularly clever system and also provided a shocking case example of how personalisation can be overdone in business. And: Even how intimate areas of the private sphere can be influenced. More than ten years ago, Target began analysing information from its pregnant female customers (in other words, customers with purchasing power and, especially, desire). The result: When certain products were purchased – Target had specially selected 25 – the company could assume that the customer was pregnant and sent her corresponding coupons. And more: The purchases even allowed it to calculate the approximate birth date – in other words, Target was always changing the coupons to correspond to the current needs of the pregnant woman. But, among the customers in the target group receiving the discount coupons were also youths. They hadn’t mentioned their unplanned pregnancy to their parents yet. Oops.

Target is both a good and fairly bad example of personalised coupons.

Now, Target only sends coupons for pregnant women in combination with other less obvious coupons. Such as dishwashing soap. Cat food. Lawn mowers. So that it looks like it’s purely coincidental. Not only because of the faux pas described above, but also because other customers found what the company knew about them creepy. In principle: All offers that have reference to health data are viewed suspiciously by customers. Health is going a step too far. However, it should be remembered: From 2002 to 2010, Target was able to increase sales from 44 to 67 billion dollars with its audacious marketing ploy. But maybe that’s just because pregnancy is its own topic.

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