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.
You might ask what the difference is between personalization and authenticity in CRM and the answer is subtle. For a long time I have felt—and said—that we over emphasize personalization when what customers really want is authenticity. But examples are hard to find, especially in our current culture where personalization is strongly emphasized and authenticity draws quizzical looks. Perhaps you are feeling that way right now.
Nonetheless, earlier this month in its August 10 and 17 double vacation issue The New Yorker served up a perfect example. For reasons that I don’t understand but am eternally grateful for, this magazine has, for many years, been an unofficial source of great material for the social CRM age. Malcolm Gladwell (author of many articles and books like Outliers and The Tipping Point) is an editor there as is James Surowiecki, author of The Wisdom of Crowds.
The article that impressed me comes almost literally out of left field. In “Learning to Speak Lingerie” Peter Hessler takes us on a trip to visit with Chinese lingerie entrepreneurs establishing a beachhead for their wares in upper Egypt. The Chinese are learning Arabic and have no familiarity with Islam or any other religion. They sell lingerie to women (accompanied by men and in one case a significant fraction of a woman’s whole family) who are dressed in traditional headscarves or more.
Despite the handicaps of language and culture, the Chinese are making inroads into the market and at one point in the article, I think you can see the handicaps working to advantage so that Chinese men are more effective at selling lingerie to Egyptian women than Egyptian men are.
Consider this: Through a translator, an Egyptian woman speaking to the reporter said, “I can’t describe how they [Chinese merchants] do it. But they can look at the item [of lingerie] and give it to the woman [i.e. a customer] and that’s it.”
That’s interesting but what comes next is key: “An Egyptian man would look at the item, and then look at the woman, and then he might make a joke or laugh about it.”
Wow! It feels creepy just reading that last sentence. Talk about personalization gone bad. The Chinese don’t have that problem in part because they’re still learning the language but also because they are focused on being authentic and in this case it means providing just enough service to help with selection and not trying to get into the mind space of the customer. Hessler documents this when he continues to quote the Egyptian woman, “When you buy something, you feel the thoughts of the person selling it. And with the Chinese their brains don’t go thinking about women’s bodies.”
This struck me as highly rational and to the point of good CRM. We make a big effort to personalize customer encounters and truth be told some of our efforts are really good and deserving of praise. But as in the example above, one person’s personalization can easily lead to another person’s feeling an insult with a resultant no sale.
That’s why my position is to favor authenticity whenever possible. It’s never perfectly clear when a customer will feel the love or something else so the question must be, why take the chance?
My suggestion to would-be personalizers is to first understand the moment of truth that your customer is actually in—it might not be what you think. Then work within the moment of truth to ensure that you are providing the authentic moment that customers want. You can’t do this unless you turn your data gathering and analytics toward metrics that tell you concretely how you’re doing. A man selling lingerie might be in particular danger of not understanding the customer’s moment of truth and personalizing it with an off-base comment (or offer) will only exacerbate an awkward moment.
Most products and services don’t serve intimate and private needs but they still come with moments of truth and customers still look for authenticity within them. I still believe that personalization is a decision on the part of the customer not the vendor. It often happens well past the halfway point of an encounter when the customer decides that, yes this fits my need in this moment of truth. That decision is often subliminal, but it certainly happens.