Personalization and the age of relevance
Matt Ramerman, President of Sinch’s mobile marketing business unit, Sinch Engage, recently joined MEF features editor, Tim Green, for a web chat. Entitled Strengthening Customer Relationships Through Mobile Engagement, the discussion took a deep dive on how personalized video messaging is engaging consumers, not just at the top of the sales funnel, but throughout the customer journey.
For Matt, the era of loyalty marketing as we know it is well and truly over, now it’s relevance that should be the primary objective for enterprises. Here are the key takeaways from the session:
Customer relationships and loyalty
Loyalty marketing no longer works. Consumers don’t actually display loyalty to brands based on discounts or fremium offers, rather, they seek out the best deal for them and are fickle about it. For enterprises this ultimately becomes a race to the bottom, undercutting competition while eroding profits or average revenue per user.
The concept of loyalty in itself should of course be a goal, but it’s the mechanics of loyalty campaigns that need to change. Real loyalty is more complex and growing, it involves zoning in on the notion that not all consumers want to buy the same thing, in the same way, every time. Rather, marketers need to look at how they can meet individual needs and interests through personalization, by creating unique experiences that directly address customer preferences – relevance.
Ultimately relevance leads to a strengthening of the brand relationship. Apple’s iPhone for example is not just a great product - the company delivers a great experience end-to-end, and Apple customers will pay a premium for it because it’s superior in both quality and experience.
The technology in our pockets
The proliferation of smartphones and formerly feature phones, has had a major impact on consumer marketing and communication. Engagement is instant, personal and effective.
Importantly, this means that enterprises can now move away from discounting to scrutinizing what the customer journey looks like, and what the opportunities are to offer an amazing and relevant experience within that journey. Taking this approach actually balances the dependence on discounts with real loyalty and repeat custom.
Personalized messaging engages consumers like no other channel
In 2010 brands were moving aggressively toward making their own app. Time has taught us that consumers aren’t keen. They don’t like branded apps and tend to disable them after a short period of time. The alternative was email, yet the email inbox is crowded and hard to get any cut through. Mobile messaging on the other hand, in the form of SMS, has traditionally delivered open rates of 90% plus.
Taking this a step further, delivering a mobile message as a short video makes that interaction even more engaging because it leverages emotion, simultaneously making a complex message very simple to understand. Further still, making that video relevant to each and every individual - addressing customers by their name and accounting for their preferences - purchase history for example - makes the engagement extraordinarily strong.
There are two parts to personalized content and data.
- Explicit. I know your name, I know you buy certain products and therefore have certain preferences that you have already indicated. These are known data points. Using this data allows us to segment and make simple inferences based on these explicit data signals.
- Implicit. Observing purchase behavior or how a consumer is using a service. For example, the Sinch Engage platform runs customer segments through a churn propensity analysis. This provides signals that mark an individual as a higher risk to leave a service – a mobile phone contract for example. In which case, if we are sending an offer or want to display a new handset, we might price that in a certain way to drive a personalized incentive to that individual. We can also run behavioral data through a purchase propensity analysis that would tell us how we might customize an offer.
1. On-boarding for a wireless carrier
On-boarding a new customer that has recently signed up for a service is a classic CRM strategy. The objective might be a warm welcome to the service, an acknowledgement of what a particular customer has signed up for and some basic orientation around next steps. The communication is based on explicit known data - in this example, a customer’s tariff plan, their name and services that they have or have not signed up for after activation.
In this case, the welcome message was delivered over MMS as a video, but equally, it could have been delivered over WhatsApp, RCS or purely SMS with a link to a video.
2. Upselling for a retailer
In this example, upselling leveraged implicit data analysis where customers were filtered based on cart abandonment, i.e. they looked at a particular garment but did not purchase it. Customers were also part of the mobile loyalty program, which meant they were opted in to receive notifications and offers.
Sinch Engage was able to showcase the product they had been looking at in video format, link the message to a store that was close to them based on their ZIP code and provide the option for a direct purchase.
3. Enhanced customer experience for an airline Sinch Engage is currently involved with many airlines that use SMS for flight notifications. The platform ingests the same notification data but instead of a few lines of text, the consumer is presented with dynamic rich media. The original metadata can also be augmented with third party data so that where in the original information we knew the flight, its destination and the departure time, dynamic rich notification enables Sinch Engage to add things like the weather of the destination location.
In terms of the customer journey, messaging is already well ahead of other channels just because the engagement levels it provides is established as the number 1 consumer preference. When you couple that with personalized video, the results are significant.
Sinch Engage has achieved a 20% plus reduction in churn - as an indicator of customer retention for subscription services like mobile carrier contracts. On the revenue side, conversion to purchase rates can be 100% greater than alternative channels like SMS or email.
Personalized video provides such a visceral medium for promoting and showcasing products and services. It’s very hard to beat!
You can view the webchat in full here, or if you’d like to get into more detail check out our eBook on Personalization: Messaging and personalization – Transitioning from loyalty to relevance or the Personalization pages on the Sinch website.