Get Started in Hyper Personalization

The internet is becoming a more popular place for consumers to spend their time. Recent surveys show that consumers spend an average of six hours per day on digital media. This is in addition to sixteen hours . Online shopping has been accelerated by the Covid-19 pandemic. Many consumers indicated that they would continue to shop online.

Businesses are paying attention. Gartner reports that seven out of ten boards have increased their digital business initiatives and nearly half of them anticipate changing their business models as a result. Companies will need to understand their customers better to drive growth. These are those who spend more time online and are willing and able to pay for the content and services they require. It is crucial to create personalized offerings that capture consumers’ attention and help them spend their time online.

Personalization isn’t a new concept. Nike’s NikeID program (now Nike By You), allows customers to personalize shoes and sportswear since 1999. The technological ease required to do this is what makes it different. Machine learning and AI technologies are rapidly spreading. Data abundance is a result of digitally-based interactions. Consumers are more willing to trade their personal data for tangible benefits like highly personalized interactions. Companies can now leverage their customer data and create personalized interactions in real time.

Hyper Personalization: The Netflix Way

Businesses are using both implicit and explicit methods to profile customers in order to provide personalized service. Netflix is the perfect example. It was the first company to use data science to provide high levels of personalization in media entertainment. Two important ways Netflix uses data analytics to achieve business success are highlighted below. First, they can offer personalized recommendations to their subscribers to keep them interested. The second is the ability to use data to develop their content strategy.

Netflix uses explicit data to feed into its recommendation system. This was made popular in 2006 by the Netflix Prize contest, which offered US$1m to the winner of a 10% improvement on its algorithm. While explicit user ratings still play an important role in Netflix’s recommendation systems, Netflix recognizes that the implicit signal is stronger. Netflix can track when people start, stop, fast-forward, rewind and rewind videos. It can also identify time, place, and device from which they are streaming. Netflix uses implicit data analysis to match viewers to programming that suits their moods and times of day.

Netflix recommends pre-existing content to its subscribers. However, it also uses implicit data to create original content. The company’s flagship production, House of Cards, was built on the analysis of data Netflix already had regarding consumer viewing habits. The company analyzed data such as ratings and viewing history to determine which actors and producers were most popular. After triangulating that viewers who viewed the original BBC production of House of Cards also enjoyed films starring Kevin Spacey, and films directed or produced by David Fincher, Netflix approved.

Netflix’s strategy to use their data to guide programming decisions paid off. The House of Cards received three Emmy Awards in 2013 and enjoyed strong subscriber growth. This strategy was replicated by Netflix with The Crown,a historical drama that portrays Queen Elizabeth II’s reign. It launched in 2016. Andy Harris was the CEO of Left Bank Pictures, which produced The Crown. He explained how Netflix had already analyzed their audience data and were ready for him to pitch the idea.

Getting Started

Netflix creates highly customized experiences for its subscribers by combining real-time data with artificial intelligence. Popularly known as “hyper personalization,” this advanced way of marketing is on the radar of pioneering marketers, according to consulting company Accenture. Hyper personalization requires regular access to customer data.

It is crucial to develop a personalization strategy for mechanics by first identifying customer needs and creating personal journeys. Implementation requires the sourcing of the right data, technology, and architecture once the strategy has been developed.

The most important thing to remember is privacy. Personalization means that more data is collected from customers, whether or not they consent. Even if the user agrees to give their data, it is still a breach of privacy. It is important for companies to consider whether privacy loss by the user is necessary to achieve their business goals. What amount and what type of data are really necessary? Privacy and personalization are a series of trade-offs which must be carefully considered and communicated clearly.

Traditional marketing is losing its relevance as more direct-to-consumer, digital-first brands enter the market. Hyper personalization can be a way for companies to stand out in a highly competitive digital marketing market. It allows them to provide their customers with precisely what they are looking for.

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