Personalization, Going Beyond the Technology

How to engage customers without letting technology get in the way of

the relationship

Edward Chenard- Started big data, data science and personalization at Best Buy, was working in big data at GE before it was called big data.- Set up one of the first hadoop clusters in Retail and the Midwest.- Won tax innovation credits for my work on personalization-Tekne finalist for big data innovation- 20 years business experience, 10 years in personalization- Managed teams as large as 300 with product portfolios of over $4B- Developed products to eco-systems

edward@echenard.com

Twitter: Echenard

Slideshare: Echenard

The SituationHow Companies Personalize Is Not Personal

The Situation: Customers want a personalized experience, yet 2/3 complain that companies rely too much on technology creating what is not a personalized experience.

How Companies PersonalizeGoogle vs Facebook

How Google Personalizes

• Google uses search and

clickstream history

• The Google Self is often vain, focused on embarrassing things and searches for things it would be reluctant to share in a social setting.

• The Google downside is that it is less able to draw on your social side, but it is able to draw on your private self more than a social site might.

• It is geared to our more Pavlovian selves.

How Facebook Personalizes • Likes, Posts and who you interact

with.

• The Facebook self is often aspirational, more of a performer and tends to be more pro-social.

• Facebook’s downside is that it is more of a public self, it draws less on your private self as we are unwilling to share this in a social setting

• It is geared towards our more sharing side.

Ultimately, neither one is a true representation of an individual

What is PersonalizationSimple Definition, Many Answers

An Experience Where the User and the Media Define a Tailored Experience

Personalization is often defined as the implicit and explicit use of data about an individual to tailor an experience for that individual.

Essentially, the individual becomes the content with relevancy, intent and time becoming the key kpis in which we measure how we successfully addressed their needs.

How companies develop a personalization experience differs, without a clear understanding of these different methods, personalization can deliver the wrong experience to the wrong persona.

Personalization requires a theory of what makes a person – of bits of data, are most important to determine who someone is – and major players of the Web have quite different ways of approaching the problem.

A good personalization strategy is an equation of psychology (the what) plus technology (the how), in that order.

Defining the StrategyElements of a Personalization Strategy

A Roadmap to Deliver the What and the How of Personalization is Needed

The follow theories and concepts are the foundation to build the strategy of personalization. These are common components that will be the core of our strategy.How we Personalize • Combine the strengths of Google

and Facebooks methods with psychograph techniques.

• Listen, Adapt, Respond

• Services co-created with customers and are interpedently with wider service networks.

Benefits

• People will log in more

• Higher conversion and AOV

• Better emotional bond between company and customer

Psychograph Self

Facebook Self

Google Self

Clash between Today and Future

Aspirational You

Present You

1-1

What is Personalizationhow to disrupt the market

Persuasion Profiling Persuasion profiling: Suggests that the kind of arguments you respond to are highly transferrable from one product category to another.

i.e.: If you like discounts you will respond well to them for shoes or TV’s. If you want the most popular and trendy product, you will want them for clothes and tablets.

Combining persuasion profiling with new methods of sentiment analysis, it is now possible to guess someone’s mood and target the right message to them based on their mood, time of day and the kind of argument they best respond to.

Ex: People use substantially more positive words when they feel happy. Analysis of twitter or FB can show this via sentiment analysis, based on the time of day, we can know what your typical aspirations are then coupled with the argument you tend to like, we can send an email to you about a product that will feel just right for you that is timely and relevant to your mood. Amazon can’t do this.

In research, this has seen a 30-40% increase in sales.

What is Personalizationusing social graphs

Persuasion Profiling Coupled with Social Graph

The US Army uses social graphs for recruiting, they are quoted as saying they have “terrific success with social graphs.

- If your 6 best friends enlist, us are likely to consider it too.

Likewise, if your friends or neighbors are buying Samsung products, you are likely to consider Samsung products too. - Using social graphs to influence is becoming the new way to target customers.

When combining social graph with persuasion profiling we not only know what you will consider based on social influence, but we know what message to send you and how to send it and when to send it, increasing our likelihood to increase conversion.

Persuasion Profiling with Social Graph in Action

What is PersonalizationPeople Do Not have One identity

Fundamental Attribution Error and Day Parting

Most personalization programs attribute peoples’ behavior to their inner traits and personality rather than to the situation they’re placed in.

Characteristics in people are fluid: Not all situations are the same, we need to match the personalization technique with the situation. The individual is the content, the tools are the context.

To be competitive, our personalization needs to be focused on day-parting strategies.

Day parting is why we don’t hear beer commercials at 8am, we have different needs and aspirations at different times of the day.

With only one identity, we lose the nuances that make for a good personalization fit. With day parting, we understand people change and we change with them fitting the content with the context.

How to Deliver PersonalizationTo go Beyond Digital You need a Broader Strategy

Personalization is different, while most services are designed to be consistent and uniform, personalization is co-created, meaning, interact anytime anywhere.

Technology as a communication tool first

Personal interaction augmented by data

Deliver value first

Be Open

Be clear and consistent

Develop real fans

April 10, 2023 11

ACTION IS THE SCARCEST RESOURCE

How to Personalize

Framing Personalization

12

Personalization

Strategy: Customer and Business Value

Analytics: Who, How, Where?

IT: What Tools and Why

Social Sciences: Understanding the Human Condition

- Measurable Results- Speed to market- What is important for the customer- ROI

- MapReduce, Hadoop- Cassandra, The Cloud- Pig, Hive,- HDFS

- Understanding the Customer- Social trends and how to use them- Linguistics - Cross cultural communication

- Data Scientist vs. Statistician- Where to find talent?- Retain, Train- Offshore vs. Onshore- University involvement

How work gets structured

Vision & Goals

Governance

Execution

Clearly articulated vision for personalization and recommendations, precisely defined goals with how to measure. Defined scope of the product.

Market strategy, customer segmentation, prioritization, org focus, measurement and incentive systems

Production process, flexibility at scale, efficiency, relationship management, benchmarking, metrics, initiatives

How We Need to Look at Discovery

Horizon

Future

Soon

Present

Past

Activity Centered Thinking

Signal TypesSignals have attributes depending on their representation in time or frequency domain can also be categorized into multiple classes

All signal types have certain qualities that describe how quickly signals can be generated (frequency), how often the signals vary (rate of change), whether they are forward

looking (quality), and how responsive they are to stimulus (sensitivity)

Rate of Change(Slow or Fast)

Quality(Predictive or Descriptive)

Sensitivity(Sensitive or Insensitive)

Frequency(High or Low)

SentimentExpressed as

positive, neutral, or negative, the

prevailing attitude towards

and entity

BehaviorThese signals

identify persistent trends

or patterns in behavior over

time

Event/AlertA discrete signal generated when

certain threshold

conditions are met

ClustersSignals based on

an entity’s cohort

characteristics

CorrelationMeasures the correlation of

entities against their prescribed attributes over

time

New Solutions Must Aid Human Insight

Big Data + Personalization + Amplified Human Intelligence

Last Decade

- Structured Data- Conclusive Dashboards- Small scale / sampling

A data architect built a view to reach a specific conclusion

Next 5 Years

- Any data, from anywhere- Intuitive exploration- Making sense of it

at scale

Business users easily find, explore, visualize and navigate insights

Human Motion Graph

18

Data Discoverers are setting the trend in what will be common place in just a few short years.

More people will want to use their data and the consumerization of data and technology will continue.

As this trend goes, only organization that learn to merge the various disciplines of strategy, analytics and IT, will be successful

data as a lifestyle

Data Discoverers

How to Deliver PersonalizationHow Macy’s Owns the Experience

Engage with customers to understand what they want and then deliver.

Engaged customers with rapid product teams to deliver apps that customers wanted.

Results: Better customer engagement.

Owning the complete experience, which means owning the relationship with the customer.

Convergence of active and passive marketing.

How to Deliver PersonalizationSelf Expression is the new Entertainment

Companies like Vine, tumblr and twitter are a new way to engage customers.

Social allows for moments in time to create impact.

Engage customers with sentiment analysis and targeted ads (personal and highly relevant).

Allow for rapid communication

Helps to better understand intent.

People are always using technology to help them be free, don’t disrupt but embrace this freedom and people will become customers. Perfect

Always Remember: Data, Insights, Actions

Listen

•Listen to the data streams

Share

•Share the data with the rest of the organization

Engage

•Engage to the data to find the insights

Innovate

•Innovate new ideas from the insights gained from the data

Perform

•Perform insightful actions from the data to create better customer experiences

The Business Value Framework

Timeliness Automated and prompted

More Products Production Efficiency

Ease of Data Collection

Business value

Ease of Implementation

Customer Needs

Perceived Value

Pre-recorded Different

Products

Production Flexibility

Customer’s Wallet Share

Customer Acceptance

Value PerceivedEase of Data Collection Customer’s Wallet Share

Business value

Initiatives

Ease of Implementation

Customer Acceptance

Focus on Customers

Focus on Internals

DATA IS THE COMMODITY, ACTION BASED ON WISDOM IS THE SCARCE RESOURCE

Next Steps

Early Stages Market LeadersLimited Selections and Locations

• Move Beyond your site properties into remarketing

• Recommendation: Razorfish

• Develop your own internal systems

• Recommendation: Learn from the Best

• Develop in-store customer feedback

• Recommendation: HappyorNot

• Engage Vendors With strong skills in personalization

• Recommendation, Wibidata

How to Develop Your Plan

PERSONALIZED MARKETINGRecommendations can provide complete package solutions based on a customer’s purchases or browsing history.

FAMILIAR EXPERIENCE ACROSS CHANNELSServices are developed to be similar for customers across any touchpoint, familiarity means better relationships

PERSONALIZED EVERYWHEREEvery channel that customers interact with.

ALL YOUR DATA IN ONE PLACECustomer data in one location for them to access and use will improve the overall customer experience by address a known customer want.

Common Quick Win areas for PersonalizationTHE RIGHT MESSAGE AT THE RIGHT TIME

Develop Your TeamData science is a discipline for making sense of unstructured as well as numerous data sets at scale

Strategy- Define the

goals

SocialDefine how to

engage

ITAssemble the

Technology

AnalyticsMake sense of the

Data

Linguistics

Distributed Processing (Hadoop)

Algorithms Development

Cross team Customer Experience Improvement

How Does Personalization Help with Growth

Pur-chase 13%

Time On Site 62%

Browse 25%

Areas of Growth

Impact on $ Before After

Conversion Rate 3.5% 12%

AOV $50 $65

Thank You, Questions?

Action

Wisdom

Knowledge

Information

Data