Ugh. Normally I love the work done by IBM’s IBV, but I think you can summarize this insight into “listen to what your customers want and then give it to them” — which I hope is not exclusive advice for one particular generation.

That said, I do think Gen Z is going to change what loyalty programs provide as benefits because of this “individualization” thing. I get a sense from my interactions with them that they aren’t going to respond as well to general points-based incentives. They’re going to want either to choose and direct the benefits they receive, or they are specifically going to want experiences — behind the scenes access, meet and greets, exclusive products, those kinds of things. These kinds of programs are much harder to pull off and that, to me, is ultimately the difference between individualization and personalization — individualization is pull from the consumer and personalization is push. But individualization means a lot more flexibility, on the part of the retailer, to accommodate.

My thoughts on this are close to what’s in the above article. Personalization and individualization is the difference between big data and little/micro data. Big data spots trends and gives you bigger pictures to your consumer behavior. Little data is based on the individual customer’s buying history.

Personalization is about marketing to segments of your customer base. The customer feels like the promotions is personal because it’s tied to what they’ve bought in the past. Thousands of customers who’ve bought similar merchandise receive the same “personalized” messages. In other words, if I buy a tennis racquet from a sporting good store, I’ll receive promotions about tennis, not golf. Yet, when you move to individualized messaging, then you are doing exactly what the word infers; targeted messaging to the unique individual. That requires a deeper understanding of your customer; what they like, dislike, etc.

As marketers, when we get to a point where we can truly individualize our efforts, we will more effectively meet our customer’s unique needs and expectations. This is true one-to-one marketing.

First of all, it’s pretty tough discerning the difference between the two and pretty easy to see how they overlap. But aside from that, the idea of customers identifying what they want and co-creating with brands will always remind me of the Henry Ford quote: “If I’d have asked my customers what they wanted, they’d have said; a faster horse.”

There’s data, then there’s creativity, and asking a “generation” to help you provide them with something creative is about data (see also: IBM). Giving them something they’d never have thought of is creativity. Retail needs more creativity, not more data.

Gen Z’s expectations of “individualization” as outlined in this research are what ALL shoppers want in a digital shopping experience. In 20 years of digital shopping, segmentation under different guises has grouped people into buckets based on a variety of inferred behaviors twisted into so-called “personalized” recommendations/targeted ads and “synthetic” shopping experiences.

Funny, “individualization” meaning how/what inspires a shopper to make the decision to purchase is completely counterintuitive to personalized segmentation. Whether a car, a dress or a home, the bottom line is that emotion-based purchases are completely unique and subjective to each individual’s sensory preferences of fit, look and feel. So while it’s nice for Gen Z to send the wake-up call for “individualization” in the digital shopping experience, all ages have been clamoring for individual shopping for years. Just ask retailers about their digital return rates. Bottom line, true “individualization” requires matching people to products they Love through the filter of “individual” preference.

What strikes me is the social/psychological realities that might lead to this. We could read this survey response to be “Gen Zers dont have much money so they suggest using their comments to get premium things.” And once they have money they’ll simply vote with their pocketbook.

That said, I’ve always been skeptical about both personalization and individualization (as described here). Retailers get some decent PR from programs in each. But personalization has generally failed to produce dramatic increases and is not a stable strategic pillar. Individualized product is also usually premium priced so it’s more appealing to consumers with more money than Gen Zers.

It’s no surprise they’d ask for all these things in a survey — essentially the news cycles and online hype have them predisposed to ask for it. The real question is: Is pursuing individualized shopping a viable business strategy? I think the answer is that it’s not. They simply don’t have the money to follow their survey answers with spending.

This study is more confirmation of trends than presenting new information. And there is value in that. I will say that perhaps a larger percentage of Gen Zers are more vocal socially regarding personalization than, say, Boomers. However, I tend to even question that statement. The more I investigate marketing today, the more I see all age groups wanting and responding to marketing promotions that are relevant to them. It just makes sense and should be no surprise. “Personalization” vs. “individualization” pertains to the level of data you capture and derive insights from. Using the tools available today will allow you to pinpoint an individual shopper’s persona and respond proactively to it. There may be thousands with a very similar persona, but the shopper will think they’re getting special treatment most likely.

Gen Z is pushing the idea of customization and individualized shopping experiences. The generation understands the amount of data being collected (and most are OK with the data collection), but they expect brands to deliver more relevant shopping experiences catering to their individualism because they know how much information brands collect. In other words, this bright generation is saying, “I know you have tons of data about me so you should be giving me individualized shopping experiences.”

One small step retailers can make TODAY is to understand feedback given through social media and apply this back into the business (products or services). There is currently a plethora of feedback from customers which is not acted upon by retailers. Take the feedback and put it back into the business.

I don’t think individualized shopping experiences only appeals to Gen Z – it is probably appreciated by all demographics. Individualization is the next evolution of personalization that combines “customer context” with personalized web experiences. Personalizing the experience based on analytics and “customer context” to create a unique, personalized experience for each customer is a differentiator. BRP defines customer context as “the interrelated factors of customer insights and environmental conditions that make the shopping experience relevant.” Retailers have the ability to know what a customer has in her closet, what she previously purchased, what she browsed on the web site and abandoned in her online cart, when she is near your store and even exactly what she is browsing and where within the store. In addition to customer insights, customer context considers environmental conditions such as current and forecasted weather, time of day, time of year, media (news), social media, traffic, holidays, events, and other conditions that impact a consumer’s purchase decision. Combining this data with dynamic web pages that are customized to individual profiles, searches… Read more »

It’s not just a generation (Z, M, X or otherwise) that is demanding individualized experiences, but rather almost every human with discretionary spending power. Customers expect more relevance from brands in a world overflowing with data. Individualization and personalization might be distinguishable semantically among marketers but customers simply want and expect brands they like to “pay attention to them and act accordingly.”

It’s not rocket science nor is it pure science or art, but rather a combination.

The expectations are clear in the proprietary research we conduct and reflect what Amazon has done with its 100 million Prime customers who have even higher expectations than non-Prime members (however few are left!).

The insights from the IBM survey/analysis will play out in how we see future loyalty programs defined by retailers. Gone are the days when simply earning tiered discounts was enough to create brand loyalty with shoppers. Personalization and individualized shopping experiences represent a new form of tiered loyalty approach retailers must adopt to appeal to each successive generation. It’s not just something for Gen Zers, although as a group they will certainly have greater appreciation and expectations for the experiences, this is something all retailers need to evolve their brands to. Giving the shopper the ability to customize and co-create in the shopping experience makes the entire process feel more emotionally meaningful. The difference is how each approach is initiated — personalization starts with the brand, while individualization starts with the shopper. It’s all about who controls the experience. Retailers will need to facilitate both in the future to be successful and build greater brand loyalty. Technologies like AI and big data analytics will play a large role here, but so will the human element… Read more »

The discussion is excellent and points to two key ideas: One, that this is about understanding what the customer wants and delivering on that (no different than for any previous generation). Two, that Gen Z is leveraging social media and other technologies to more aggressively push for individualization whenever possible. A retailer delivering individualization well is Stitch Fix, who marries big data analytics with a real, human stylist who engages directly with each customer to co-create each “fix.” Another who is doing this on a fully human level is Dirty Lemon, whose healthy beverages are marketed and sold exclusively via text message, leveraging Gen Z’s favorite way to communicate. And the conversation is all human — no chatbots or other AI tech. The point here is that each brand and retailer needs to understand how they can provide engagement for their customers that leverages today’s technologies in a brand-right way. Personalization remains a core effective strategy, blended with appropriate Individualization. Yes this is more costly, but is now a growing requirement for ongoing engagement with… Read more »

Gen Z is really no different than any other group (Gen Y) who wants things personalized, to fit their needs. Who doesn’t want a loyalty program that gives their customer enough flexibility to feel like it was “customized” for them? From baker’s dozen (your 13th is your own choice and free) to frequent buyer discounts, we have been dealing with loyalty programs in customized versions for years. Gen Z will push the shopping experience to be more technology driven, but the demand for individualized satisfaction tied to the customer loyalty program will not change … only how it can be customized through technology.