Why context is more important than data in personalization

Personalization is often treated as a data problem. Do you have enough qualities? Are your parts complex enough? Is your technology stack capable of supporting it?

While those questions are important, the secret sauce is understanding the context behind a person’s interaction with your brand at a particular time. A casual traveler might visit an airline’s website one day to research a family vacation. The next time they see, they might book a flight to work. Their thinking profile hasn’t changed, but what their content – and what they want from you – has.

The real work of personalization begins when you marry behavioral categories with specific context. We call these situations, and they are the bridge between knowing your customer and actually helping them.

Context-based design that maximizes personal experience

Scenarios connect behavioral segments to specific, real-world situations, describing a specific situation, what the other person is trying to do and what might happen next. They are deliberate and decisive, mapping decision points and possible paths.

In a retail example, a business might focus on a customer trying to return an online purchase to a store, mapping two paths – one before the product’s return window is technically closed and the other after the return window closes. Regardless of the component, the intended result is the same because the context is the same.

In both cases, you want to think about how each part of your behavior will react and what information they might need to feel comfortable moving forward. The goal is to design a path to a target outcome that is as unproductive as possible. The way we deliver each time – or, perhaps, even how many times there are – changes based on the stage.

At the operational level, each branch of the situation has the potential to introduce the need for new processes, new content and sometimes new channels or tools. These are mapped and documented. They become part of the overall design.

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From theory to practice: Conducting a workshop

How exactly do you create these conditions? In my work, I start with workshops that involve a cross-functional team that understands your business, your customers and your operational realities. My team creates 5-10 strawman scenarios and brings them to the workshop. Together, we move between each other, checking accuracy, frequency and impact.

Some cases are being fixed. Some are cut off completely. The goal is not to include everything. It’s about focusing on the moments that will have a real impact on your customers and your business. Ultimately, you have to prioritize. Choose more than three to start. Then the real work begins.

Here is a simple overview of the process:

• Start mapping: In each case, you plan to experience it as it is, the default way things work today. He writes every step from the customer’s point of view. What do they see? What are they doing? Where are they stuck and why?
• Find opportunities within the current experience: Where are the gaps? Where does the experience break down? Where can you add value, remove friction or anticipate a need before the customer sees it?
• Design what it will be: Start with the right basic feeling — default. Once you have the default information, start layering your segments. Within any situation, different segments will need different things.
• Stress test: You don’t just design in a vacuum. You prototype, talk to customers about the segment and validate your assumptions against actual behavior. You want proof that the feeling you’re designing is actually felt.

Don’t boil the sea: Prioritize important moments

Not all cases can start at the same time. Once you’ve mapped out what you’re going to have, you need to prioritize. What can happen inside faster than on the road? What level of effort is required? What is the timeline? And, most importantly, what is the consumer’s desire for this change?

You also need to define success. How will you know if this situation-based personalization is working? If your call center makes 100 calls a day from customers who can’t return something to the store, maybe the goal is to cut that down to 50.

Build your success metrics around real results, not vanity metrics. Did they engage with the message about return policies? Did they complete the refund without needing support? Did they buy again? Any of those results can be considered successful, depending on the goal.

Customers who use effective, context-driven personalization are 2.3 times more likely to confidently complete key purchase decisions, according to Gartner research. That kind of improvement translates directly into customer satisfaction and marketing ROI.

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The reality of personalization working at scale

Here’s where it can get tricky. When you’re talking about hundreds of cases and five or more segments in each case, you’re building a complex system. That system requires real muscle to work.

On the content side, you need to change the tone, messages and images to match different segments and contexts, which is no small feat. It may also require operational changes beyond sales. Maybe you never allowed online orders to be returned to stores, so now you need to change the policy. You need to train the staff to facilitate that return. You need to update your point of sale system.

You may find that, to deliver personalized experiences at this level, you need a technology infrastructure that you don’t currently have. Real-time data becomes critical. You may need a customer data platform to integrate information across systems. You may need SMS capabilities or emotional intelligence technology in your call center. Other segments or situations may present specific needs, including new data sources, integrations or tools.

Personalization is not a marketing exercise. It affects operations, technology, data management, training, policy and more. It requires cross-functional collaboration and a willingness to change the way your business actually operates, not just how it communicates with customers.

McKinsey research shows that personalization can reduce customer acquisition costs by up to 50%, increase revenue by 5 to 15% and increase marketing ROI by 10 to 30%. But the key statistic is this: Companies with fast growth rates earn 40% more revenue from personalization than their slow-growing counterparts. The difference is not just doing it personally but doing it right, at scale, with the operational and technical infrastructure to support it.

Why is it worth the effort

I know this sounds like a lot. Corner. The good news is that we now have AI and machine learning that can help pattern match, test, iterate and respond much faster and with greater accuracy. Research from Forrester shows that travel-focused organizations are now managing travel at a higher level, using AI-enabled tools to assess impact, prioritize situations and assist in scenario planning. And, of course, AI will play an important role in the content supply chain to help create and evaluate message and content diversity. These gaps have previously been barriers to even attempting this type of personalization.

But like I said before, you still need smart people and a plan. Even with AI, there is real work to be done. Another is to continue to treat personalization as a high-level strategy, change the wording in the subject line of the email and call it a day. That approach does not build trust. It does not create credibility. And increasingly, it doesn’t drive results.

When you design for context, when you create experiences with situations that reflect the reality of your customers’ lives, you are doing something very different. You show them that you see them, that you understand the problems, trade-offs and downsides of their experiences. That creates an emotional connection and drives long-term value.

Behavioral isolation gets you to the door. Conditions open it and invite your customer to enter. Together, they transform personalization from a buzzword into a business advantage.

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