Are machine learning and AI the path to enhanced personalization?
Two recent surveys from Evergage and Arm Treasure Data have found that marketers are increasingly hoping that artificial intelligence (AI) can take personalization to another level.
The Evergage survey of 314 marketers across industries and countries (largely U.S. based) found 68 percent use a rule-based approach to personalization, compared to 51 percent using a triggered messages/notifications approach and 40 percent using a machine learning/algorithmic approach.
The percentage of companies using a machine learning/algorithmic approach to personalization, however, has climbed significantly from only 26 percent in 2018. Usage of the two other approaches for such purposes remained stable versus the prior year.
Moreover, of those marketers not currently using machine learning/algorithmic personalization, 42 percent plan to begin using it within the next year.
The survey found only 30 percent of those that use machine learning/algorithmic personalization are “very or extremely satisfied” with their personalization programs, but that was better than the 19 percent score for rule-based targeting and 16 percent for triggered messages/notifications.
The most popular locations for personalized experiences were e-mail content, 73 percent; home pages, 49 percent; landing pages, 41 percent; interior pages, 36 percent; and online ads, 30 percent.
A recent survey of 200 marketing executives from Arm Treasure Data with Forbes Insights found only 24 percent applying AI on a significant scale to deliver personalized experiences. Six in 10, however, were starting to adopt the technology to personalize at scale and 57 percent see AI as essential to executing their personalization strategy.
Similar to other recent reports, both studies show personalization can significantly advance customer relationships, even though execution remains a struggle.
The greatest obstacles preventing companies from making personalization a bigger priority is a lack of personnel, cited by 46 percent of survey respondents, according to Evergage. That was followed by a lack of budget, 43 percent; lack of knowledge/skills, 38 percent; lack of organizational alignment, 32 percent; and access to data, 30 percent.
Arm Treasure found that customer personalization is still not a top corporate priority. The study stated, “Technical challenges include addressing data quality issues and data silos, while a lack of effective change management limits companies from achieving greater success.”
- 2019 Trends in Personalization Survey Report – Evergage
- The clear path to personalization – Arm Treasure Data/Forbes Insights
- 25% of companies use AI in their personalization efforts, study finds – Marketing Dive
DISCUSSION QUESTIONS: What are the advantages and shortcomings of using machine learning/algorithmic approaches for personalization? Will AI help retailers and brands overcome obstacles faced in executing personalization?