Stats That Show the Importance of Personalization for Customers

Stats That Speak for Themselves: Stats That Show the Importance of Personalization for Customer Experience

In the digital age, customers and consumers are becoming increasingly accustomed to having algorithms do the work for them. This means having the capabilities to use artificial intelligence to collect data about your consumer and customize their experience accordingly. Whether it's through products you present to your customers, titles for a streaming service like Netflix, or other customized options, giving the customer a tailored feeling helps ensure retention.

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Background: The importance of personalization

In the past, the competitive framework meant that most businesses just had to worry about other companies with similar offerings in their general region or vicinity. With the advent of the internet, brick-and-mortar is becoming increasingly irrelevant, and there is a growing need for businesses to restructure and adapt to a more digital world.

Along with that comes increased competition—instead of operating as a closed unit within your community, many small business owners are now finding themselves fighting tooth and nail for brand recognition in the Wild West that is the World Wide Web. One of the biggest things a business can do to come out on top in this environment is offer a personalized experience to their customers.

This isn't just based on anecdotes—there is measurable data to support the conclusion that tailoring content and offerings to your client's wants and needs helps increase engagement and encourage repeat business. This article will list some of the most staggering statistics that help illustrate just how critical collecting and utilizing customer data for personalization is.

Stats about personalization

According to a 2017 study conducted by Segment, 71% of customers report feelings of dissatisfaction when their shopping experience is not adequately customized to their individual needs. Regardless of the quality of your products—whether goods or services—presentation is key when it comes to engagement and retention in the fiercely competitive world of commerce.

SmartHQ study

A study by SmarterHQ showed that 70% of millennials—defined as those born after 1980 but before 2000—reported frustration when they received emails and snail mail from companies that were not tailored to their unique consumer profile. Businesses can do more in this area to ensure that their customers feel seen when sending out correspondence, helping to ensure that this correspondence results in conversions.

In a crushing blow to small businesses everywhere, in the same survey as the one listed above, this same age demographic reported checking Amazon for alternatives if the company they were shopping with did not present adequately customized results. At 47%, that means that nearly half of millennials will shop on Amazon if other businesses fail to deliver products in a personalized manner.

The number of consumers who believe that retailers need to improve on their personalization efforts is inching towards half, with 36% responding "Yes" when asked whether or not retailers need to do more to offer increased customization to consumers by Retail Touchpoints. This shows a growing sense of dissatisfaction in the "Digital Native" generation when it comes to the level of personalization offered by most companies.

Accenture study

Perhaps the most staggering statistic on this list, and the one that best demonstrates the need of retailers to respond to the consumer's demand for personalization, is that 91% of respondents said that they are more likely to shop with businesses and brands that offer better personalization over ones that are not, according to a study conducted by Accenture in 2021.

This proves that many businesses are misusing their email blasts and wasting valuable time and resources on marketing efforts that don't result in conversions. A SmartHQ study showed that 72% of applicants would only engage with emails personalized to their needs—meaning many will not click the call-to-action (CTA) buttons on these email blasts because they have not reached the correct audience.

According to Accenture, 74% of customers also believe that the ability to create "living profiles" makes a brand or company more appealing than those that only allow consumers to fill out a few basic questions. This means allowing customers to include a comprehensive list of preferences so they can easily have items and services that match their needs—suggested to them on your website. 

This shows that customers are tired of scouring the internet looking for something they need under piles of things they don't. Businesses that can fill this gap by finding something to suit the customer's needs simpler and faster have a high-value proposition to offer consumers.

Conclusion

It isn't easy finding new ways to do business in the competitive landscape that's quickly becoming a highly corporatized society. That being said, customers will engage with brands and companies that treat them like people instead of numbers. If you want to set yourself apart, it means meeting the needs of a market with a growing number of customers seeking better personalization.

This may mean turning the way you do business on its head and restructuring from the top down, for example, building better algorithms and product filters to help customers find what they need quickly. This helps reduce bounce rate and prevents customers from choosing another website that will succeed where you may have failed—such as Amazon.

Another way to achieve this is by sorting customers into groups and targeting your correspondence based on how these groups behaved in your analytics. As you enact these changes, you will see the improvement in your performance indicators. Rather than working hard trying to sell customers something they don't want, you'll be presenting yourself as an option to customers who are looking for something they do want.