What is Predictive Personalization?

While many marketers and brands are talking about consumer experiences and personalization in their digital marketing efforts, there are few brands that are doing this effectively and at scale.

The topic of predictive personalization can be confusing and might seem intimidating for marketers, but regardless of where your brand is on the personalization journey, it's important to get started. This guide to predictive personalization can help you get a better understanding of what predictive personalization is, what it means for your consumers, and how you can get started.

What Does Personalization Mean?

First, let’s start with the basics. Personalization refers to tailoring consumer experiences to the preferences of an individual consumer. Curating experiences for individual consumers relies heavily on personalization AI and data science – the goal is to use the data you’ve collected on your audience to curate relevant and meaningful experiences across channels like your website, SMS, and email campaigns. The more personalized the experience is, the more likely consumers are to sign up for your CRM, make more purchases, and remain loyal to your brand.

So, what’s an example of personalization? 

Imagine a hair and beauty brand’s historical data shows that Julianne visits the website to view products designed for curly hair, but their data on Maria shows that she adds lots of hair coloring products to her online shopping cart. Knowing this, the AI that enables predictive personalization can automatically curate website experiences that are tailored to Maria and Julianne’s preferences. With the right set of content personalization algorithms, they’ll see personalized content and product recommendations based on the data that the brand has at its disposal. 

How Does Predictive Personalization Work?

Personalization engines can take the data that you’re already collecting about your consumers and make the analysis process easier, allowing you to pull actionable insights about your audience and improve the consumer experience.

Predictive personalization is somewhat self-explanatory – you’re predicting what content or products an individual consumer wants to see when they visit your website. This relies on the combination of historical data with real-time contextual information about the consumer, such as location, time, date, and weather.

If an alcohol retailer’s historical data shows that Michael purchases whiskey from their website every two weeks, it would be a safe assumption that the pattern would continue and he might purchase whiskey two weeks from his most recent purchase. This is where it’s important to combine historical data with real-time contextual data. For example, if it’s Labor Day weekend and the weather is warm and sunny, Michael might be more likely to purchase a seltzer, beer, or lighter spirit than whiskey. While the historical data may show that Michael almost always purchases whiskey, the ability to provide personalized product recommendations can improve his consumer experience and may lead to more purchases in the future. 

The Most Powerful Tool in The Marketer’s Toolbox

If you’re trying to improve your brand’s consumer experience, enabling predictive personalization is a good place to start. Not only can it keep your consumers loyal, it can yield big returns for your business in terms of engagement, CRM registrations, and sales.

Now, think about curating an experience like the ones mentioned above for every one of your consumers at the same exact time. With the right personalization algorithms and tools, you can curate a different experience for each individual consumer – if you’ve got 100 consumers, your solution should be able to produce 100 variations of the consumer experience. If you’ve got one million consumers, you should be able to produce a million variations. 

Of course, predictive personalization is impossible to do manually. With thousands or millions of consumers, curating experiences for every single individual isn’t feasible – that’s where the right personalization tools come in. It takes time to implement a predictive personalization engine, and without a robust personalization strategy, getting those efforts off the ground is hard. 

With the right vendor or software solution, marketers can enable truly relevant and personalized digital consumer experiences across their website and other channels like email and SMS. 

To learn more about how to get started with predictive personalization, get in touch with us today!