What is hyper-personalization?

Hyper-personalization is a form of marketing that uses artificial intelligence (AI) in conjunction with real-time data to create products, services, or content that is customer-specific and highly granular. Often the process is automated; however, there is scope for in-person hyper-personalization as well. Hyper-personalization is also referred to as one-to-one marketing.

One example of hyper-personalization is specialized social media ads, like the ones that offer custom hair solutions. With one quick and a short quiz later, you are presented with the option to buy a super-bespoke concoction that will banish bad hair days forever for your specific hair needs. This is a basic example that can be found online.

Customers in every sector are spoiled by choice, with many brands paying money to buy seconds of their attention. Whether customers are scrolling through Instagram or walking into a clothing store, they are on the lookout for products and services just for them: ones that will elevate their buying experience from average to awesome. Brush up on your hyper-personalization strategy to avoid alienating this discerning group and gain brand loyalty in a world full of advertising noise.

How does hyper-personalization differ from traditional personalization?

A typical example of traditional personalization is adding a person’s first or last name to a standard email such as “Dear (first name)” and a standard message. This is a common brand interaction.

Hyper-personalization goes to another depth entirely. It harnesses the power of AI and machine learning (ML), in addition to other devices powered by the Internet of Things (IoT). These tools garner a large amount of data about every customer interaction to build a thorough profile of that customer. It enables the seller to know, for instance, at what times of day a customer is likely to be online or scrolling through Facebook and when to time their ads accordingly. Also, it helps brands accurately time their push notifications to maximize the chances of the customer acting on them.

Where traditional personalization will show you online ads based on what you bought last fall or what other people are buying, hyper-personalization will take all the data from your prior purchases to figure out your preferred color palette, your height, body structure, location, shopping times, and payment method of choice to craft a pitch just for you.

Essential elements of a winning hyper-personalization strategy

With hyper-personalization, you aim to treat every visitor to your store or eCommerce site as a unique entity with specific messaging. Here are some strategies that will enable you to craft personal content:

Good product and company knowledge

For starters, you need an in-depth knowledge of the workings of your own company, your product info from start to finish, your logistics, your USPs, and so on. With this knowledge you can create meaningful and worthy messaging.

Excellent data and privacy policies

Your customers should know that you are a trustworthy steward of their personal data, whether they have volunteered it or whether your AI and ML setup are gathering it in the background. Your company policy on data should be transparent and meet all standards.

Know your audience

Gather insights from the data collected to build a life-size profile of your buyers, and segment them into various groups based on their characteristics. You need to do this to generate content to apply to their varied sensibilities, likes, and dislikes, to “nudge” them in the buying direction.

Harness the power of big data

Use analytics and data mapping to create a hyper-personalization framework that helps you deliver the best buying experiences to your customers.

Deliver promises

Have resources in place that will help you implement your strategy seamlessly and then deliver on your promise once the purchase has been made.

From an automation perspective, the four pillars of creating a hyper-personalization strategy that works are:

  • Gathering data
  • Segmenting your customers and creating customer personas
  • Using metrics to measure the success rate of messaging and outreach
  • Analyzing your findings to fine-tune content

Why early adopters of tactical hyper-personalization have an edge over the competition

There is an early-mover advantage to hyper-personalization. Customers are more likely to conduct business transactions with a company that offers personalized experiences, but not many companies are taking heed yet. Customers want to feel valued and heard, and when they are, they will shop frequently.

Companies should embrace digital transformation and harness data to formulate hyper-personalization strategies and assign budgets. They would also do well to explore and set up product-recommendation algorithms that offer website visitors specifically curated choices.

The benefits of hyper-personalization

  1. Hyper-personalization removes specific obstacles in the buyer’s journey, providing easier, quicker access to what customers are looking for. They want to bypass pain points and get to what they need faster.
  2. Hyper-personalization shortens sales cycles.
  3. Hyper-personalization reduces consumer stress. Rather than overwhelming customers with a huge array of merchandise, present them with a curated selection of items that are likely to appeal to them. This increases the chance of purchase.
  4. Hyper-personalization promotes brand loyalty and customer retention.
  5. Campaigns can build upon themselves, or be fine-tuned, using data and analytics gained in real-time.

The challenges of hyper-personalization

While there are benefits to hyper-personalization, there can also be challenges. Hyper personalization is time-consuming and trying to achieve that degree of granularity can become expensive. The biggest dilemma for marketers is deciding when in the customer life cycle to deploy personalization strategies. Here are two options:

  • When you have all the data you need though there has been no direct interaction between your company and the target customer(s)
  • After an actual personal interaction has taken place between your company and the customer, where the customer has consciously provided information

Some companies deploy personalization strategies based on anonymous data such as IP address-based location. Others wait to interact with customers to gain a more in-depth understanding of their needs, likes, and dislikes before formulating a personalized pitch.

Customers can feel intimidated by the capabilities of technology that reads into personality traits, online behavior, and digital footprints, predicting their next move before they know what it is going to be. With permission-based hyper-personalization, customers are less likely to feel uneasy about all the details a brand knows and less likely to perceive it as a privacy invasion.

The approach you choose, whether anonymous or permission-based, will have to be well thought out and beneficial to your company and customers for hyper-personalization to succeed in the long term.

Hyper-personalization diagram