Hyper-personalization in Customer Service: still a distant reality

When GDPR came into effect mid-2018 in the EU, it was expected that similar policies will soon be implemented across to globe. It was largely believed that concerns over privacy and data usage are going to increase, and companies will soon be scrambling to gather potent customer data.  Yet, here we are, in the era of hyper-personalization, where companies are collecting more and more data about their customers in the guise of providing better customer experience. However, the biggest use of hyper-personalization we see is only for pushing relevant marketing content to increase sales.

For those who are new to this term, hyper-personalization was intended to improve the abysmal click-through-rates experienced by not only generic, but even segment-based marketing initiatives. Apart from the basic personal information voluntarily given, companies gather data about customers’ behavior, such as date/time of engagement or purchase, device used, search terms, brand affinity, etc.  Then, using AI and ML models, they send hyper-personalized marketing content, increasing the chances of a transaction. That’s why Netflix recommended you to watch a brainless comedy on a Saturday evening, which you thoroughly enjoyed. And there are many others. Here's an image that can simplify the concept for you:

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While I have always been impressed by these companies providing me with customized offers that take me closer to making a transaction (or the proverbial “sale”), I have not seen much of it being used to provide stellar customer service. I am still going through the same lengthy process to raise a query about returns, despite following a specific “preferred” path in the past. The models are not recognizing that I prefer a phone call when I’m looking for help on a mobile, whereas on my laptop, I’d rather chat. The hotel didn’t reserve a queen bed for me, though I travel with a kid; the airline didn’t block an aisle seat, though that’s what I have always chosen; the bank didn’t offer to send me a new card, though I have faced multiple card errors. Even all the material I have read, point towards how companies have been able to increase their click-through-rates, conversions, and engagement.  No one seems to have accurately measured how ‘holistic customer experience’ has changed, which, quintessentially, includes service.

Success stories of hyper-personalization are plenty. Not only businesses, even customers have been benefited, as they can now get what they want without much effort. Many companies are publicizing how their customers love these personalized recommendations. But if the customers realize what more could have been done, and that the company is not doing it, the comments won’t be as rosy as they are now. Companies that engage hyper-personalization should educate their customers about what data is collected, and how it’s being used. Further, ask them what more would they like to see happening with this data. This avoids companies conveniently assuming they are “servicing” the customer by making relatable offers. What are the customers getting in return for letting you have their data? You saved a few clicks and made it easy for them to spend more?  If the customers’ perennial quest for “What’s-in-it-for-me” is not duly fulfilled, soon they may shun your offers for a competitor who focuses on serving the customer better. Worse still, they may choose to support the demand for stricter data policies.

This in no way is a tell-all piece on how to improve customer service using hyper-personalization. It’s just my take on what I would like to see happening in this space. It remains to be seen which of the hyper-personalization pioneers will take the big step in this direction. Would love some references for further reading; please put them in the comments.