This was the question I asked students to write a paper about. I will select ar random 2 students’ papers and ask you to write a 200 word reply in a discussion form. I WILL SEND YOU YOUR PAPER TO REMIND YOU YOUR TAKE.
Select an organization that employs a highly personalized approach to selling products or services to its customers online (example, Amazon, Spotify, Netflix..). Ideally, this is one that you are familiar with.
1. What are the different ways that this organization uses personalization in its marketing effort?
2. What are some of the specific actions/behaviors that customers engage in that enable personalized service?
3. What are specific customer actions and behaviors that the firm can collect data on that would provide evidence of the effectiveness of personalized marketing efforts?
4. What digital analytics can the firm use, based on your learning this week, that firm measure the value of personalization for the organization?
Student 1
Online shopping is becoming more popular with the advancement in technology. So, for e-commerce companies like Amazon to work efficiently, they must provide their customers with enough information to make decisions. If the customer is not satisfied, it will affect the efficiency of the business. Personalization on the Web refers to adapting web content to meet individual consumers’ specific needs or preferences which allows the customers to find information efficiently and support the decision of customers to improve the company performance. (Huang, & Zhou, 2019). Amazon uses personalization in its marketing strategy. For instance, they focus on each individual’s browsing history and past behavior to offer recommendations relevant to each one-time purchase (Li, & Unger, 2012). For example, during the Christmas season, Amazon would change their advice from offering personal items based on previous purchases to providing those products that are more popular based on the past purchase of customers behavior during that season. Amazon also uses personalized marketing emails and big data to create a unique experience.
As big data allows a more significant opportunity to understand the components of their customer behavior, this happens once the customer checkout. Amazon personalization also leverages the concept that the many are more intelligent than the few. Taking advantage of the large amount of data generated from their service, they identify opportunities to communicate more information about features that a customer may not be fully benefiting from. (Marshall, 2018). The actions that facilitate such personalization are the opinions and review of customer wants using segmentation based on specific characteristics of popular products relevant to each customer. Amazon utilizes the existing storage of collected data about orders, customers, products, shipments, payment information, etc., and communicates with other businesses to take and fulfill orders as personalization is the key to customers experiencing satisfaction with their marketing strategy. Amazon analyzes raw data for perceptions and trends to make decisions. The combined use of predictive and diagnostic analytics can utilize data collected to determine patterns of different marketing relevant factors that would change over time to predict future marketing outcomes and interests. For instance, if Amazon realized that electronics are in high demand at Christmas through diagnostic analytics, they would price them competitively and focus on aggressive advertising. They would do so by advertising it based on customers past purchasing behaviors and recommending those products on the website. The repeated advertising of these products would increase the chance of customers buying those products, which can be analyzed through predictive analytics.
References
Huang, J., & Zhou, L. (2019). The dual roles of web personalization on consumer decision quality in online shopping: The perspective of information load. Internet Research, 29(6), 1280-1300. doi:http://dx.doi.org/10.1108/INTR-11-2017-0421
Li, T., & Unger, T. (2012). Willing to pay for quality personalization? trade-off between quality and privacy. European Journal of Information Systems, 21(6), 621-642. doi:http://dx.doi.org/10.1057/ejis.2012.13
Marshall, G. (2018). Marketing Management (3rd Edition). McGraw-Hill Higher Education (US). https://online.vitalsource.com/books/9781260157857
Student 2
Businesses often use personalized marketing or what is also sometimes called one-to-one marketing. Personalized marketing is the act of a business using data to deliver brand messages targeted to an individual prospect. Messages are often sent out through cold calling, letters and advertisements in the mail and billboards (What is Personalized Marketing & How can you excel at it? [examples] 2019).
Netflix is a company that often uses personalized marketing to please their customers. They do this by picking movies and shows that their customer can relate to. After finding these pickings, Netflix places them into different personalized rows where the customer can quickly access the movies and shows that interest them. They even go as far as to personalize the artwork that is used to represent the chosen movies and shows. This is all ultimately done by using an algorithmic approach that addresses all of the many unique needs of their customers (Netflix research).
Many customers including myself often focus on the trending movies and shows on Netflix when we choose to engage in the app. Customers often focus on the "TOP 10" list that Netflix has at the top of page once someones goes into the app. This top 10 list usually features all ten of the most sought out Netflix movies and shows, and also the newest movies and shows. There is also a list of movies called "recommended for you". Customers enjoy having this feature and the click right into it to find movies or shows that are recommended for them based on what they’ve watched in the past. This is very helpful to customers because they don’t have to waste time looking through the tremendous amounts of content that Netflix has available. Customers also used the different categories where they can at least narrow their search by different categories. This could be anything from the "action" category to the "comedy" or "horror" category and there are many more.
Reed Hastings, CEO at Netflix, stated back in 2005 that his future plan for Netflix included consumer science. He stated in a conversation with their former VP Gibson Biddle, "Leaders like Steve Jobs have a sense of style and what customers seek, but I don’t. We need consumer science to her there" (How netflix’s customer obsession created a customer obsession 2019). Gibson realized he needed to go from customer focus to customer obsession in order to reach the level of success that they wanted (How netflix’s customer obsession created a customer obsession 2019). So they started focusing on different customers by doing the following:
- Listen to what customers say
- Focus on customer satisfaction
- Provide better product than competition
- Balance customer satisfaction and margin, to build a business
(How netflix’s customer obsession created a customer obsession 2019)
The customer obsession
- Test & learn via customer science
- Invent and deliver on unanticipated, future needs
- Aim for long-term customer satisfaction
- Pioneer new frontiers with less competition
- Lead with customer delight, ensure work is hard-to-copy, & higher margins follow.
(How netflix’s customer obsession created a customer obsession 2019)
Netflix also began to understand current and past customer behavior by using existing data. Netflix was also ability to hear what their customers thought and see how they react to their work by using qualitative research using focus groups and one-on-ones. Surveys also gave Netflix a look into what the customer thought of Netflix. The company’s A/B tested the hypotheses formed from all of these methods listed to see which method worked (How netflix’s customer obsession created a customer obsession 2019).
Netflix routinely collects data from the platform that customers are using to watch Netflix. They also study user’s watch history, search queries, and also the time that customers spend watching the show/movies of their choice. Netflix also occasionally collects data from demographics, interest-based data and also internet browsing behaviors (How netflix uses data to pick movies and curate content 2020).
Thank you,
References:
How netflix uses data to pick movies and curate content. Ohio University. (2020, July 2). Retrieved January 19, 2022, from https://onlinemasters.ohio.edu/blog/netflix-data/ (Links to an external site.)
Netflix research. Netflix Research. (n.d.). Retrieved January 19, 2022, from https://research.netflix.com/business-area/personalization-and-search (Links to an external site.)
How netflix’s customer obsession created a customer obsession. Nir and Far. (2019, July 31). Retrieved January 19, 2022, from https://www.nirandfar.com/customer-obsession/ (Links to an external site.)
What is Personalized Marketing & How can you excel at it? [examples]. Instapage. (2019, October 1). Retrieved January 19, 2022, from https://instapage.com/blog/personalized-marketing#:~:text=Marketing%20personalization%2C%20also%20known%20as,targeted%20to%20an%20individual%20prospect.&text=With%20billboards%2C%20cold%20calls%2C%20mailings,of%20messages%20over%20their%20relevance
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