Hyperpersonalisation: How companies are putting people back at the centre of things
E-Commerce
Every person is unique – a distinctive individual with their own preferences, needs and wishes. Ideally, we would like to be treated in the same way in our interactions – not as a mere ‘customer’, but as a human being. In the business world, however, it is all too often different: standardised mass approaches and impersonal interactions often make us feel like a mere number in the system, just a means to an end in a company’s process. But in the digital age, there is a strong trend that is reversing this development: Hyperpersonalisation. In this blog post, we explain what the term means.
To every soul belongs another world; for every soul, every other soul is a back world. Appearances lie most beautifully between the most similar.
Friedrich Wilhelm Nietzsche
What is Hyperpersonalisation?
The prefix ‘hyper’ is borrowed from the Greek and means ‘above’ or ‘more than right, good or normal’. This is exactly what describes the hyperpersonalisation approach: it goes far beyond the ‘normal’ by using advanced technologies such as artificial intelligence (AI) and big data to gain deeper, more individual insights into a person’s behaviour and preferences. The goal of hyperpersonalisation is to provide each customer with a tailored experience that is tailored to their specific needs and interests in real time and across all touchpoints.
Hyperpersonalisation vs. Personalisation
Hyperpersonalisation is more than traditional personalisation. Instead of a general marketing approach that is often only based on simple, historical data such as names or previous purchases (for example in email marketing campaigns), hyperpersonalisation advocates perceiving people as individual beings and offering exactly what they actually need or want at that point in time. It’s about not only knowing who the person is, but also understanding what they need at that moment – and doing so in a way that offers real added value. Hyperpersonalisation is therefore a further development of conventional personalisation. It makes it possible to be successful in areas where conventional approaches reach their limits.
Why do people want to be treated like this?
As individuals, we want our uniqueness to be recognised – especially in a world where we are increasingly confronted with impersonal mass interactions. A personalised experience shows customers that they are valued and understood. It strengthens customer loyalty as customers feel respected and the centre of attention.
Imagine you walk into a shop and the sales assistant remembers your last purchases, knows what you might like and recommends a product that exactly matches your current needs. This is the kind of service that makes hyperpersonalisation possible online – through data analysis, machine learning and intelligent algorithms.
How does Hyperpersonalisation work?
To implement hyperpersonalisation, companies rely on a variety of data sources and technologies:
- Behavioural data: Companies analyse how users move around their website or app, which products they look at, which content they consume or which items they put in their shopping basket without buying them.
- Demographic data: This includes information such as age, gender, place of residence or occupation. This data helps to make predictions about which products or services could be relevant for a particular person.
- Real-time data: Thanks to modern technologies, companies can analyse real-time data and deliver personalised offers and recommendations in the shortest possible time.
- AI and machine learning: By using artificial intelligence and machine learning, companies can recognise patterns in customer behaviour and make predictions about which products or services are particularly relevant to them.
- Omnichannel approach: Hyperpersonalisation goes beyond the individual channel. Companies collect and process data across different channels – from social media to emails and website interactions – to create an end-to-end personalised experience.
To summarise: As soon as the necessary data has been collected and bundled, the AI takes over the analysis. As the AI learns continuously, it becomes better and better at understanding customers. Hyperpersonalisation unfolds when the individually tailored content is played out in real time (e.g. personalised emails with customised images or videos, tailored landing pages, real-time notifications on prices or offers, etc.).
Advantages and challenges of Hyperpersonalisation
For companies, hyperpersonalisation not only increases customer loyalty, but also brings economic benefits:
- Higher conversion rates: Customised content, products or services increase the likelihood that users will actually complete the purchase. This customisation in turn reduces returns.
- Less wastage: Marketing measures can be used in a more targeted manner, resulting in lower costs and greater effectiveness. This improves the ROI of marketing.
- Better customer loyalty: A personalised customer experience strengthens loyalty and reduces the likelihood of customers switching to the competition. According to the PwC ‘Global Service Study 2023’, 60% of respondents report that their loyalty to a company decreases if there is no hyper-personalisation.
- Increase relevance: Customers only receive offers and information that are of interest to them. This makes contact more relevant and less intrusive.
As attractive as hyperpersonalisation sounds, there are also some challenges that companies have to overcome:
- Data availability and data protection: The basis of hyperpersonalisation is access to detailed customer data. However, as data collection increases, so do the requirements for data protection. Companies must ensure that they comply with the provisions of the GDPR (General Data Protection Regulation) and maintain customer trust.
- Technological infrastructure: Hyperpersonalisation requires the use of modern technologies such as AI, machine learning and big data analysis. Companies that do not have the necessary infrastructure could find it difficult to implement these strategies effectively.
- Balance between personalisation and privacy: Finding the right balance between personalised experiences and protecting privacy is an art. Too much personalisation can come across as intrusive and put customers off.
Who does Hyperpersonalisation?
There are several companies that provide hyperpersonalisation as a service or part of their offering. Here are some examples:
- Amazon: Amazon relies heavily on hyper-personalisation by analysing the purchasing and search behaviour of users in order to offer individually tailored product recommendations and personalised content.
- Airbnb: Airbnb offers users the opportunity to discover local attractions that are customised to their interests. Based on their previous behaviour and decisions, the app presents personalised recommendations for attractions in their area or current location.
- Netflix: Netflix uses hyperpersonalisation to generate tailored film and series recommendations based on users’ viewing behaviour and preferences.
- Sephora: The cosmetics brand Sephora offers personalised product recommendations and beauty advice by analysing data from its customers’ purchasing behaviour and preferences.
- Spotify: Spotify uses hyperpersonalisation to create personalised playlists such as ‘Discover Weekly’ and ‘Daily Mix’ based on the listening behaviour of its users. Even tickets for live events and concerts can be purchased on Spotify that match your interests.
Elements of Hyperpersonalisation
Three key factors play a central role in realising hyperpersonalisation in your online store:
- Engagement: In order to offer hyperpersonalised offers and content, you need your customers’ data. It is therefore crucial that they are willing to share this information with you – which is only possible if they feel addressed by relevant added value.
- Relevance: The content displayed, such as recommendations or search results, must be highly relevant to your customers in order to attract their attention and motivate them to make repeat purchases.
- Trust: Since your customers’ data is extremely sensitive, trust plays a central role. Responsible and transparent handling of the information provided is essential in order to build and maintain this trust in the long term.
Conclusion: Hyperpersonalisation as the key to individual experiences
Hyperpersonalisation offers you the opportunity to address people on a deeper, more individual level and create tailored experiences. By understanding your customers’ needs and preferences, you can strengthen their loyalty and be more successful in the long term. However, despite all the enthusiasm, the benefits of hyper-personalisation should always be used within a responsible framework – as in the current example of the sports shoe manufacturer Nike.
Until recently, users were able to personalise Nike shoes with a controversial party slogan – an unwanted hijacking by political supporters that cast Nike’s brand in an undesirable light. Nike reacted quickly and stopped this possibility, which shows that companies need clear rules and filters to prevent abuse. This demonstrates the need for proper contextualisation: it is not enough to simply use data to enable customers’ every wish – it must also be placed in the right social and ethical context. Companies must ensure that their hyper-personalised offers and options correspond to their own values and do not support any questionable messages.
Contextualisation does not just mean providing contextualised content and offers in real time. Contextualisation also means not viewing hyper-personalised content in isolation, but always in the overall context – taking social, cultural and ethical implications into account. Only in this way can hyperpersonalisation be used sensibly and responsibly.
Overall, hyperpersonalisation offers enormous opportunities, but the right contextualisation and clear ethical guidelines are crucial. You should be careful not only to create hyper-personalised experiences, but also to always offer them in a respectful and responsible framework.
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