Gartner estimates that the fragmented but quickly consolidating customer experience and relationship management software market generates $50BN in revenue per year and is growing at a 15% compound annual growth rate. If we add the additional investment in IT, human capital, and creative development, brands invest well over $100BN per year to deliver relevant and valuable experiences to their customers.
With all that spent money, why is it that 78% of customers are frustrated by untargeted and irrelevant marketing and communication from brands' campaigns? While culprits range from siloed datasets to disconnected activation channels, in our experience, the biggest culprit is the human decision process at the center of it.
Don't get me wrong. This post isn't about human vs. machine. It's about human AND machine.
The relationship between a customer and a brand is always changing. Customers continuously migrate between items they buy and the channels they buy them in. Their responsiveness to different messages and their engagement on different channels is never static. When you overlap that with all the various messages that a brand might engage a customer with to drive a specific business outcome, the number of potential customer interactions is over one billion per day per customer!
If we extrapolate this across millions of customers, we're looking at quadrillions of decisions that need to be made each day to deliver a relevant and valuable customer experience to a brands' customer base. This is why brands spend over $100BN a year on customer experience and relationship management software and other tools.
Despite this massive investment, most brands still operate in a world of traditional personalization - where marketers build campaigns, define audiences, pick channels, and activate segments. Glibly recapping on the above, with over one billion potential customer interaction combinations per day per customer, how likely is it that a marketer will pick the right one?
So what's the solution? Programmatic personalization.
Just as programmatic advertising is the automated buying and selling of advertising in real-time at a customer level using cloud-based technology and algorithms, programmatic personalization is the automated decisioning on what experience to deliver to a customer using similar cloud-based and algorithmic technologies.
This programmatic personalization capability sits between the data stack (ex. an enterprise data warehouse or customer data platform) and marketing cloud (ex. Salesforce or Adobe) to deliver the right experience for the customer. It's a complementary, not a replacement piece in a brand's existing marketing technology stack that generates an intelligence feed for more relevant and valuable customer experiences.
An intelligence feed is so important because the potential value of all the data that brands collect to engage their customers and grow their business vastly exceeds the human capacity to process and act on it.
Programmatic personalization enables brands to continuously engage their prospects and customers on a one-to-one basis with machine-optimized messages, offers, and experiences that are relevant to the customer and in line with business objectives.
Circling back to my earlier analogy, just as programmatic advertising has delivered breakthroughs in advertising efficiency, effectiveness, and ROI, programmatic personalization is doing the same. We've seen clients increase their sales lift and ROI by up to 16x vs. traditional personalization when fully scaled across millions or tens of millions of customers.
What is the role of the marketer in this brave new machine-optimized world? The human part of human AND machine will be the focus of my next article. Stay tuned.