Cultural differences are shaping consumer expectations
Online shopping is continuing to grow massively and consumers spend more time online than ever, according to Katharine Hulls, VP of marketing for Celebrus Technologies, and Ruth Gordon, director of digital marketing for Teradata, who here examine the differences and similarities between consumers in the UK and Germany when it comes to the way they react to good and bad personalisation by marketers.
The two companies recently conducted research that showed some 53% of German and 47% of UK consumers go online more than 10 times a week to shop, browse for different products and services or to manage an account they have registered with a brand. As such, expectations of the online experience are growing.
Getting the balance right
Our research revealed that the vast majority (63%) of consumers across every age group like to receive personalised offers. However, there are clear differences in attitudes across the age groups. Unsurprisingly, it is those under 25 who are more excited by the personalisation delivered by brands, with 79% of consumers aged 18-24 finding personalised brand communications helpful. However, as many as 26% of the 65+ age range said that personalised offers make it easier for them to find what they want - proving that regardless of age, personalisation has its benefits.
These personalised experiences are working for brands - over two thirds (67%) of consumers said they would positively interact with a brand in response to a good personalised experience. Interestingly, the reasons for enjoying personalisation are split pretty evenly across categories; 24% of consumers feel that personalised offers make it quicker and easier to find what they are looking for, while 23% enjoy receiving bespoke offers and/or coupons and 21% of consumers say that product or service recommendations give them new ideas.
The value of these positive interactions is clear, they increase sales. Over a third of consumers would purchase from that brand again and 27% would recommend the brand to friends/ relatives. They improve relationships; consumers are far more willing to engage with the brand following a good personalised experience, with 21% saying they would complete a product review and 15% would engage more readily with brand communications such as email or SMS.
The price of getting it wrong
Don't forget, though, that poor personalisation can be damaging. Failing to communicate with the customer in the way that appeals most to them, or delivering a poor experience, can be seriously detrimental for brands.
For example, the research highlighted that UK consumers are far less forgiving when it comes to a poor personalised experience than their German counterparts. 36% of UK adults claim that a bad experience would mean they would not buy from that brand again, 30% would complain to family and friends (very detrimental as 'word of mouth' has a significant impact on brands) and around a quarter (24%) would complain directly to the brand. When the same question was asked of German consumers 17% said they would not buy from the brand again, 20% would tell family and friends and just 11% would complain directly.
It is critical that brands get the balance right. With 55% of consumers citing email to be the preferred communication medium it is vital that brands do not abuse this channel - while consumers are happy to receive email it would appear that over-emailing, combined with poor personalisation, will not only negatively impact a customer's views of the brand, but is damaging to future relationships.
Know your customer
The positive and negative implications of personalisation both in the UK and Germany are clear and the onus is on organisations to get the right communication to customers. Those that get personalisation right can inspire consumers and have a positive impact on customer loyalty. However, attitudes to personalisation differ significantly between nationality and it is important for brands to be aware of this, so as to ensure they are marketing to their target audience correctly.
The research also indicates that consumers are particularly concerned about their data being passed over to third parties - just 15% would be comfortable with data being passed on to other brands. This is mainly due to the fact that consumers feel that they will be spammed with irrelevant offers - in fact, 19% of German consumers report that whenever they have shared this kind of information in the past they have been deluged with spam. Brands can combat this by making sure that their data usage and sharing policies are clear to the consumer - if the customer knows what they are signing up to, and they can control their data, trust can be built and with that longstanding relationships.
The business cost of poorly judged and incorrectly directed personal communications is becoming significant. Consumers are becoming increasingly positive when it comes to personalisation and brand interaction - due to brands getting better at using past consumer behaviour and contextual information to ensure that the interaction is relevant. Consumers are therefore demanding individualisation and they expect brands to at least be making a good attempt to treat them correctly. In order to get personalisation right, brands need to understand and respond to their customers at an individual level; a broad segmentation approach is no longer sufficient.
The full research results have been made available for free download from the Celebrus web site as part of the an eBook entitled 'Balancing the Personalisation and Privacy Equation' - click here (free registration required).
Sources: Celebrus Technologies; Teradata / The Marketing Factbook.
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