This is part of a series of posts on modern approaches to customer loyalty aimed at improving it through customer engagement. A fuller discussion is available in my new book, You Can’t Buy Customer Loyalty, But You Can Earn It.
Lots of CRM vendors talk about personalization but their idea of how to do it leaves a lot to be desired. They do personalization very late using a just in time approach to accessing customer data to support a sales or service encounter in the moment. This certainly is important and it achieves the goal of personalizing the encounter by producing a catalogue of data including the customer’s history, demographics, and other relevant information. With it a customer-facing employee or automated process can make intelligent decisions in the moment and offer, among other things, next best actions or offers. So there’s a lot to like with this form of personalization.
But why wait until you’re in the moment of truth to personalize? This kind of personalization implies, or should imply, another form that’s further upstream from the moment. In my last two books I’ve written a lot about moments of truth. Briefly, they should be predictable and every business ought to know what they are. Typically, customers experience moments of truth, times when they want or need something from a vendor that the vendor should be able to provide.
Moments of truth are driven by reasonable expectations that are based on marketing, brand promises, or the nature of a product or service. For example, there is an expectation of ease of use for most electronics today. That’s a vague idea but its based on the vendor’s responsibility to research customer attitudes and habits, to start with, and to design solutions to the expectations that arise from them.
When a vendor takes on understanding moments of truth and succeeds the results can be powerful. One of my favorite examples is Starbuck’s loyalty program mediated by its mobile app. Starbucks started by trying to figure out how it could enhance its customers’ store experience and discovered that at busy times, customers had to wait in two lines that could be rather long—one line for ordering and another for pickup. Eliminating the wait time became one of the drivers for the mobile app that lets people order from their phones even while en route to the store. Upon arrival it is now a simple matter of picking up the order.
With its app, Starbucks gave customers the ability to customize or personalize their visit, the onus is on the customer and there’s little need to crunch massive amounts of data.
Proactive personalization doesn’t require a mobile app though many businesses have made great use of the smartphone as a platform. Another great example of personalization is Hilton Hotels and its HHonors app. With it, customers can reserve a room, see a map of the property and select a room, order services, and even turn the phone into a room key. Similar to Starbucks, Hilton puts control of many aspects of the experience in the palm of a customer’s hands.
As we’ve seen personalization can mean many things and it’s not always about data or certainly not just data—it implies relationships. For this reason community can have a big impact on how a vendor approaches customers. In most of my research it is hard to come across any situation where a vendor maintained tight control of the information customers could access. In most cases personalization involved giving up that control in favor of giving customers the ability to control their destinies. It involves an amount of trust but I can’t think of a situation where trusting customers wasn’t a good idea.
A case in point is SOL Republic.
(Cross-posted @ Beagle Research Group)