How to personalize cx through the power of conversation

Foreword

Before digitalization, the “personal touch” was the traditional hallmark of quality in CX. Synonymous with luxury and elevated experiences, it was leveraged by brands, institutions and organizations across the board.

Today, CX is all about personalization and, with a myriad of new digital tools at their fingertips, CX practitioners are using data and automation to take this a step further, hyper-personalizing the experiences of customers.

As a result, the modern customer experience has transformed from local, linear, and transactional to one where brands are informing, engaging, and interacting with their customers en masse and across multiple channels.

Consumers have embraced this new world of interactive CX with online platforms, apps, and self-service options rapidly gaining popularity, but they still expect the personal touch. In fact, data published in 2022 by Twilio found that 49 percent of consumers will buy again from the same retail brand if it effectively personalizes their buying experience.

At present, there is an abundance of digital tools powering this trend and these tools are as much about an organization’s internal processes as they are the B2C relationship. This presents an undeniable business case for all organizations to ensure customer-facing processes are digitalized and, most importantly, integrated to support the demand for hyper-personalized CX.

Twilio also found that while 75 percent of companies think they are providing “good” personalized experiences, only 48 percent of customers agree. This indicates a clear opportunity in how to personalize overall CX, whether it is more effective use of customer data or addressing how disparate IT systems share and utilize this data for the task at hand.

Ongoing digitalization presents new opportunities for organizations to meet their customers – to engage, interact and, most importantly, hyper-personalize their experiences. This report assesses how leading organizations including Nike, TravelPerk, Oxfam GB and MaineHealth have embraced this and the tools that supported their strategy.

Providing guidance on how to leverage first-party data and technology to craft a personalized customer experience, the report explores the application of a customer data platform (CDP) that supports both customers and agents and allows organizations to take decisive action in response to the needs of the business, customers and market conditions.

Crafting personalized experiences

In its State of Customer Engagement Report 2022, Twilio found 88 percent of companies view personalization as important to their customer engagement strategy. Yet Twilio’s State of Personalization Report 2022 found that only 35 percent of companies feel they are successfully achieving omnichannel personalization.

The hyper-personalization happening at present would not be possible without digital transformation and the data collected by digital tools and interaction points.

First-party data is the primary building block of any personalization strategy. It gives agents a 360-degree view of the customer, thus enhancing the value and relevance of that customer’s interaction and the agent’s job satisfaction.

Also read: Personalize CX with data driven self-service

Yet, when Twilio asked organizations about the types of customer data used for marketing strategies, 81 percent said at least half of their data is third-party (see Figure 1 on the next page). This creates friction as customers interact with agents who cannot access the insights required to contextualize the call. Furthermore, it undermines the sense of engagement and understanding customers feel with an organization.

This can be particularly evident in healthcare, where patients expect agents to have a 360-degree view of their data and see anything less as an indicator of potential data security issues.

Traditionally, personalization has been enabled through CRM integrations. However, this has limited impact and is growing ineffective as the demand for hyper-personalization grows.

Lenore Files, principal product marketing manager, contact center solutions at Twilio explains: “CRM is static object data inputted by overworked, exhausted sales teams. Companies have a lot of data about customers including website clickstreams, ad impressions, purchase history and insights gleaned from live conversations with agents.”

All this can be put to work to deliver a personalized experience, but the bar keeps inching higher. As a result, more and more businesses want to capture the trend for hyper-personalization, while building on the human-to-human interactions that distinguish their brand from its competition.

For many online enterprises, personalization is the core proposition. Online-only business Stitch Fix is an AI-powered clothes shopping service, which allows customers to affordably collaborate with a personal stylist. It has expanded on this by using AI and algorithms to power the wealth of options available for its personalized style cards and its “shop your look” function.

At the other end of the spectrum, when global sports brand Nike was forced to close its retail stores at the start of the Covid-19 pandemic, personalization tech brought its traditional brick-and-mortar offering to life online. Nike had more than 30,000 store employees – which it calls athletes – and a potentially infinite number of customers who all wanted to connect with each other. By developing an API platform with bespoke messaging facilities Nike was able to connect its athletes to its customers to offer real-time personalized guidance on each purchase (see page 8).

Initiating the project

To initiate a data-driven personalization project, the first step is to set objectives and then work back to determine which types of data are best suited to the job.

Caroline Carruthers, author of the Chief Data Officer’s Playbook and chief executive of Carruthers and Jackson, says: “My tip to any organization is to think about this the other way around: work out how you want to personalize CX before you start using first-party data.

“Data is an amazing tool which can make so many innovations come to life, but it should underpin business goals rather than being seen as an end in itself. Do not fall into the trap of data for data’s sake, actually work out what you need the data for first.”

For Carruthers, in the current data environment where third-party cookies are still in use, the choice between using first- and third-party data is dictated by project goals.

Effectively utilizing the data at hand, however, remains a barrier for many. A lack of tools, personnel and understanding are just some of the common obstacles that organizations face in their personalization journeys.

The next section of this report takes a deeper look at the role of such data in personalizing customer experiences and how this could be affected by the roll back in cookies.

“Data is an amazing tool which can make so many innovations come to life, but it should underpin business goals rather than being seen as an end in itself.”

Caroline Carruthers

Author and chief executive of Carruthers and Jackson

Figure 1:

Third-party data use by organizations

The role of data in personalized CX

The keystone of any personalization strategy is data. It can be used to prompt the customer journey, refine products or indicate new marketing opportunities. Yet not all data are created equal, and not all organizations are as successful at putting the numbers to work.

Referencing the rich data companies hold on customers, Richter says: “The goal should be to activate this data for more personalized, productive customer experience.”

According to Twilio, fewer than half of companies (47 percent) personalize communications based on real-time customer insights. Yet customers are increasingly vocal about how and why data is used, with 85 percent preferring brands to exclusively utilize first-party data when creating personalized experiences and services.

Hyper-personalized travel

The utilization of first-party data has many benefits (see Figure 2). For example, Meeters is an experience focused local travel website, which partners people with like-minded adventurers in Italy. Personalization is the cornerstone of the experience and data underpins this. Whether it is for hyper-personalizing online content based on profile interests and location or using behavioral and geofencing data to promote nearby activities as travelers arrive in a specific locality.

Meeters CMO Roberto Boschiroli says: “In customer service, first-party data means building rapport, making the conversation personal. From answering a customer phone call and addressing the customer by name, to sending a personalized surprise birthday card with a free ticket to a relevant travel experience.”

At Meeters, contextual, behavioral and demographic data is collected and used with the sole purpose of serving customers.

“Help customers find faster solutions to life’s needs to give them a better digital experience,” Boschiroli remarks.

“Companies already have a lot of data about their customers, including website clickstreams, ad impressions, purchase history, and insights gleaned from live conversations with agents. The goal should be to activate this data for more personalized, productive customer experiences.”

Timothy Richter

Director of product marketing, cloud contact center solutions at Twilio

“My advice would be to act fast,” he adds. “Use customer data platforms (CDPs) to collect, store and unify data. Start building personas, cross device tracking, personalized funnels and website content.

“Build a big database, nurture a customer community with strong brand alignment, and leverage internal data to scale business revenue without having to break the bank,” Boschiroli says.

Advising enterprises across the board, Boschiroli says data should be kept fresh and audited frequently using data cleansing software. Regular contact with the database is also important to maintain and nurture engagement levels.

“Collecting first-party data could mean reaching scale without having to rely on third-party businesses,” he asserts.

Also read: CX Personalization in APAC report 2022

Cookies and third-party data

Despite the choices available at present, third-party data sourced via cookies will not be available after 2024. This presents an even stronger case to build future-proofed personalization strategies around first-party data sooner rather than later.

A 2021 report by Epsilon and Phronesis Partners Inc found that of 259 US-based marketers, 39 percent were “very” reliant on cookies, while 41 percent reported being “moderately” reliant. Notably, 83 percent said they expect “moderate or significant” impact from the changes on their ability to reach customers.

Any organization progressing its digital transformation will naturally require a new suite of digital tools for a post-cookie world. Twilio has found 53 percent of business leaders are investing in better technology to manage customer data in response to data privacy changes among governments and private companies.

The next section of this report explains how leading brands from multiple industries have leveraged new technology to differentiate their customer journeys with freedom of choice.

Figure 2:

First-party data: Why organizations are focused on proprietary data

Tools to transform personalization

As detailed by Meeters’ Boschiroli, CDPs facilitate personalization by gathering first-party data and disseminating it to contact center representatives or self-service points to provide the context required for a successful and efficient customer interaction.

Twilio’s customer data platform (CDP) has been implemented by businesses across the US and Latin America, in addition to the Europe, Middle East and Africa (EMEA) region.

Twilio’s Richter says: “Personalization with first-party data using a CDP is the future of customer experience.

The CDP plays a central role in looking holistically beyond the contact center to leverage the rich data a company already owns.

“It allows companies to pull from and combine disparate systems of customer information – not just the CRM – to deliver personalized, tailored experiences,” he adds.

Twilio’s Segment CDP leverages relevant personalized data for marketing promotions and customer support. On the other hand, Twilio Flex enables companies to create a bespoke omnichannel contact center experience for customers, agents, and supervisors.

When Segment and Flex are utilized together – or with other Twilio tools – organizations deliver higher personalization that drives NPS and CSAT gains, along with higher agent productivity and job satisfaction across the workforce.

This creates a stronger employee experience (EX) and therefore lower attrition.

Furthermore, such new technologies provide organizations with a compliant way to activate first-party data, thus helping deliver the personalization that will meet their objectives and customer expectations.

User snapshots

Mainhealth

Deployed Twilio Flex as a single application for IVR, voice, and digital channels

90 percent: Operational cost savings

45 minutes: Reduction in contact center wait time

Travelperk

Deployed Twilio Flex and Twilio Segment to unify disparate channels and build out data infrastructure

95 percent: NPS score after deployment

>20 seconds: Customer support response time

Nubank

Deployed Twilio Flex for customization and greater autonomy, stability and security

1.9 million: New customers averaged per month

113 million: Hours saved in wait times

Oxfam GB

Deployed Twilio Flex to support hybrid work and better respond to its aid workers

70 percent: Reduction in overheads

80 percent: Infrastructure migrated to cloud

Prometric

Deployed Twilio Flex to enable its ProProctor online testing solution

20 percent: Increase in agent productivity

50 percent: Decrease in connection issues

Maricopa county, Arizona, US

Deployed Twilio Flex to create “citizen-centric” experiences for a population of 4.5 million

US$185,000: Reduction in HR costs

×16: Increase in use of AI bots to handle 33,000 calls pcm

Differentiating the brand proposition

As demonstrated, the customer demand for personalized solutions has touched every sector. This section of the report details two very different organizations using similar solutions to create distinguished and brand-aligned personalized experiences.

FYidoctors

Canada’s largest doctor-owned eye care provider specializes in personalized patient experiences. To support this, FYidoctors partnered with Twilio and Blacc Spot Media to build and deploy a Twilio Flex contact center.

Once deployed, FYidoctors immediately recognized significant improvements in patient and staff support. Efficiency reduced average handle times, and Net Promoter Scores improved. Insights gleaned from implementing Flex then allowed FYidoctors to build dashboards that could identify gaps in coverage and agent availability. Abandonment rates dropped from 17 percent to 13 percent.

Patrick Graham, director of service center at FYidoctors, says: “While the flexibility and robustness of Twilio has transformed our service center and how we support our clinics and patients, perhaps the greatest benefit has been the strong relationship and support we’ve received from both Twilio and Blacc Spot Media along this journey.”

The project delivered a customizable, patient-first contact center experience for patients and internal staff to support growth and patient care innovation.

• 11 percent increase in first call resolution rate
• 13 Point increase in NPS
• 29 percent reduction in avg call time

Nike

At Signal 2020, Twilio’s virtual customer and developer conference, Nike president and CEO John Donahoe delivered a keynote on how the retailer turned to Twilio to keep its employees and customers connected.

Pre-pandemic, Nike had a target for 30 percent of all business to be sourced via digital by 2023. Then events of early 2020 forced Nike to go 100 percent digital overnight and its army of more than 30,000 store athletes were confined to their homes.

A long-term Twilio customer, Nike turned to Twilio’s API platform to build bespoke messaging functionalities that could enable digital customers to converse with home-bound employees. Donahoe told the conference: “Your platform played an incredible role to help us stay close to consumers [and employees] love the fact that even though our physical stores were closed, they could help our digital customers with insight, advice and education.”

In its financial results released August 2020, Nike reported an 83 percent jump in online sales and an additional US$900mn in revenue from digital sales.

• 30 percent digital sales target achieved three years early
• $900m additional revenue from online sales
• 30,000+ employees given meaningful work during lockdowns

Final remarks

Personalization requires a clear road map of strategic implementations with buy-in from the most senior levels of leadership – it is most successful when multiple data types are combined to paint a unique picture of the individual customer and address their needs.

For example, a single location may have thousands of very different customers, but cross-referencing location data with two or more other data points allows a company to build, and communicate differently, with each customer persona.

For digitally transformed customer experiences, the collation of multiple communication channels into a single application provides customers with consistent experiences across multiple channels. This reinforces confidence in the security and privacy of their data and reaffirms their loyalty.

Such integrations can be supported with an effective CDP to deliver relevant customer data that goes beyond the static CRM record for personalized, productive engagements.

Insight from Twilio found 41 percent of surveyed businesses use a CDP at present to activate real-time data, providing a clear advantage over the 59 percent that do not.

As customer experience races to the top of companies’ priority lists, allowing customers the freedom of choice is crucial to achieving and sustaining personalized CX.

Read the PDF report here