Today, our teammates over at Segment released their second annual State of Personalization survey, which captured a watershed moment for businesses and consumers alike. 

In the past year, the COVID-19 pandemic prompted a dramatic shift to digital channels, and quickly raised customer expectations. 

Personalized customer engagement is now the baseline for businesses today– with everyone trying to match the standard set by powerhouses like Amazon and Netflix. 

Which led us to ask: how are businesses adapting? 

Twilio Segment surveyed over 3,000 companies, consumers, and marketers worldwide to understand the changing attitudes and expectations surrounding personalization. It’s a deep dive into how consumer behavior evolved these past twelve months, and how businesses responded. 

The personalization gap: expectations vs. reality

There was a mass migration to digital channels in 2020. Hundreds of millions of consumers started engaging with businesses primarily online, expecting brands to recognize who they were and what they liked, regardless of which channel they used.

And businesses struggled to meet these new expectations. Many are still notably behind on personalization, according to our survey, even as they continue to double-down on digital transformation. 

While 85% of the businesses believe they are offering personalized experiences, only 60% of consumers seem to think that’s the case.

Some businesses are benefiting, while others fall behind

The pandemic condensed a decade’s worth of e-commerce growth into a few months – and marked a permanent shift to online channels. 

And one thing is clear: the businesses that get personalization right will reap the benefits of customer loyalty. 

More than half (60%) of consumers say they will likely become repeat buyers after a personalized shopping experience with a retailer, up from 44% in 2017

In fact, over a third of consumers said they would return to a brand that offered a personalized experience, even if there were cheaper or more convenient options available elsewhere. 

Omnichannel is being overlooked 

Covid-induced trends (like curbside pickup, telehealth, etc.) saw people move between devices and channels like never before. This led to customer data being fragmented across dozens (and even hundreds) of different systems in an organization. 

In our survey, one of the top challenges that businesses listed was siloed data. Less than 1 in 4 businesses have the required technology to deliver consistent, personalized experiences across channels – showing a blindspot when it comes to omnichannel customer experiences. 

Personalization and privacy aren’t mutually exclusive

Privacy regulations are rapidly evolving, sparking a global debate about data integrity. While third-party cookies have been used for years to track users and serve personalized ads, they’ve led to a decline in consumer trust (with browsers gradually phasing them out). 

As a result, first-party data has emerged as the better alternative (debunking this idea of a “personalization-privacy paradox”). Consumers understand that data is necessary for personalization, but want more transparency on how it’s collected and used. 

In fact, 69% of consumers said they appreciate personalization, as long as they’ve directly shared data with that business. 

The State of Personalization hones in on an important point: for businesses today, it’s personalize or perish. To dive deeper into these trends and insights, be sure to check out the full report here.

Jesse Sumrak
Jesse Sumrak is a Content Marketing Associate at Twilio SendGrid focused on writing killer content and producing captivating webinars. A writing zealot by day and an ultramarathon runner by night (and early-early morning), you can usually find Jesse preparing for the apocalypse on a precipitous peak somewhere in the Rocky Mountains.