Brands Prioritize Tech and First-party Data To Achieve Personalization


Personalization is undoubtedly table stakes for a brand’s success today. A 2021 report by TwilioOpens a new window showed that 45% of consumers would likely take their business elsewhere if brands failed to offer personalized experiences. Yet, achieving personalization has become trickier due to several factors, such as strict consumer data privacy laws and ever-increasing customer expectations. So, what exactly is the state of personalization today? Twilio conducted another survey this year to get a pulse check of how experiences and attitudes regarding personalization have changed over a year and what themes are shaping the future of personalization.

The following are the insights from the study in detail.

Personalization and ROI Go Together

The study showed that people are rewarding brands that are getting personalization right. Personalization efforts may include the right product/service recommendations, relevant discounts and offers, or even a hiccup-free experience across various channels. About 49% of consumers said they would likely become repeat customers if they had a personalized experience with a retailer. About 38% said they would buy again from a brand that delivered a good experience despite cheaper and convenient options.

On the other hand, the penalty for not delivering personalized experiences is significant and rising. About 62% of consumers said a brand would lose their loyalty if the former failed to deliver a personalized experience. This was up from 45% last year.

In essence, rich experience equals repeat customers. Further, personalization leads to increased revenue across a customer’s overall lifecycle. Both consumers and businesses agreed that consumers spend significantly more when engaging, personalized experiences are offered. In fact, 80% of business leaders surveyed agreed with this statement.

See more: 3 Things Stopping Marketers From Achieving Personalization Goals

Investments in Omnichannel Are Improving, but There Is Much Ground To Cover

Twilio’s 2021 report showed that the omnichannel strategy of a majority of surveyed businesses was not entirely in place. The situation has improved over a year. About 35% of companies felt they were successfully achieving omnichannel personalization, compared to 24% last year. That said, many business leaders thought that their omnichannel readiness was limited due to tech and organizational constraints.

While 60% of respondents cited increasing investments in personalization this year, they struggled to implement and execute full-scale personalization initiatives. The most common challenges fell into four broad categories: lack of technology, accurate data, unclear ROI, and organizational impediments. About 40% said that getting accurate customer data was a challenge.

Businesses Are Future-proofing Personalization Efforts With First-party Data

Due to regulatory changes and moves from tech giants like Google and Apple, businesses are facing an immediate need to develop a strategy to collect, manage, use, and protect first-party consumer data in a compliant and responsible way. This means the use of first-party data has become table stakes for marketers. About 37% of businesses said they exclusively use first-party data to personalize experiences, an increase from 31% last year. There are several reasons for relying on first-party data, including higher quality, better consumer privacy, and manageability. 

Why business leaders are focused on first-party data

Source: State of personalization reportOpens a new window

Businesses are also turning to new technologies, such as customer data platforms (CDPs), to activate first-party data in a compliant way. These technologies are, in turn, helping businesses deliver the same personalized experiences to consumers. About 53% of business leaders said they invested in better technology to manage customer data due to privacy changes.

Businesses Are Looking for Balance in the Personalization-privacy Paradox

While consumers want personalization, there is a delicate balance when it comes to curating digital experiences. The study foundOpens a new window that data privacy and protection are top of consumers’ minds as they grow wary of communication that feels invasive. About 60% of consumers said trustworthiness and transparency were the most important traits of a brand, up from 55% last year. Further, only 40% said they trusted brands to keep their personal data secure and use it responsibly.

In such a scenario, cutting down the middleman and focusing on first-party data is key to increasing consumer trust. Despite 65% of consumers worrying their personal data was being used without their permission, 63% were comfortable with personalization if it was first-party data that was acquired voluntarily.

The Bar for Personalization Is Getting Higher

As personalization efforts gain more importance, businesses need to deploy more sophisticated strategies. This means understanding and engaging with consumers on channels they prefer most and delivering personalized experiences on these channels. About 53% of brands are focused on improving existing channels to offer consumers a better experience. On the other hand, 63% of consumers want to be able to interact with a brand on more than one channel.

Personalization is usually synonymous with rudimentary tactics, such as using the first name on the top of the email. But 47% of businesses were looking to go beyond this and instead personalize their communications with reliable and real-time customer data. About 41% also said they now use a CDP to activate real-time data.

See more: How Zero-Party Data Can Take Your Customer Experience to The Next Level


As consumer attitudes toward personalization and data privacy evolve, businesses and brands must take steps to collect data in secure, ethical and compliant ways to deliver the rich experiences consumers expect. While recent regulations have made personalization more challenging, the right tools and platforms, such as CDPs and advanced AI-based tools, can help businesses succeed by activating real-time customer data. Simultaneously, going beyond rudimentary tactics and creating experiences that are more relevant to consumers will help businesses win more customers and their loyalty.

What steps have you taken to achieve personalization in a compliant and consumer-friendly way? Let us know on FacebookOpens a new window , TwitterOpens a new window , and LinkedInOpens a new window .


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