Four Examples of Personalization Designed to Retain More Customers
By Tricia McKinnon
When personalization is discussed today it often spoken about in conjunction with artificial intelligence. While artificial intelligence provides a great way to generate meaningful recommendations for what a customer may be interested in purchasing it is not the only way to provide a more customized experience. Old fashioned customer service where a retailer provides a hands-on service that is tailored made for a customer is still extremely valuable. When considering the best strategy for having a personal connection with customers retailers should always think about both online and offline strategies. While many organizations are struggling to get personalization right, these four organizations are doing a great job.
1. The Ritz Carlton
The Ritz Carlton has long been known for its award-winning customer service. It has earned the Malcolm Bridge National Quality Award twice. One of the keys to its success is empowering employees to surprise, delight and solve customer problems. As a result of this philosophy, Ritz Carlton employees are empowered to spend up to $2,000 per day to improve the customer experience of any guest.
This program has led to many examples of outstanding customer service. For example, one Ritz Carlton customer forgot their laptop charger in their hotel room. Before the customer had time to call the hotel, the charger was couriered to the customer. A loss prevention employee that sent the package wrote in a note accompanying the package: “Mr. DiJulius, I wanted to make sure we got this to you right away. I am sure you need it, and, just in case, I sent you an extra charger for your laptop."
In September 2017 Nordstrom launched a new store concept called Nordstrom Local. Nordstrom Local stores are small. They are only 3,000 sq. ft and they do not carry dedicated inventory. The stores are focused on service and providing a great experience and some of the services offered at Nordstrom Local stores include:
Personal stylists – Stylists, free of charge, curate outfits for customers to try on
Style boards – Nordstrom staff create digital boards with personalized fashion recommendations for customers. The boards can be viewed on the customer's phone and purchases can be made directly online
Manicures – are also available in-store
These services are the definition of personalization because what each customer receives is unique to them.
3. Stitch Fix
Stitch Fix, the online personal styling company has done a great job of using artificial intelligence to provide personalization on a mass scale. To get started with Stitch Fix customers complete a detailed online questionnaire. The questionnaire covers a wide range of areas to provide an understanding of the customer’s style, size, price preferences and how often they need new clothing for various occasions (i.e. work, dates, events etc). It employs 80 data scientists with PhDs in areas such as math, neuroscience, statistics, and astrophysics. Using over 85 meaningful data points provided by customers, merchandising algorithms based on artificial intelligence are built and used to make personalized clothing recommendations for each customer. Then stylists add an essential human touch and they can override the recommendations made by the algorithms. Customers then pay a $20 styling fee (no subscription is required). Five clothing items are sent to the customer and if they like them they can keep them, if they do not, they can return them for free.
Sephora’s innovative mobile app contains a Virtual Artist. The Virtual Artist uses facial recognition technology to allow customers to digitally try on products. Customers scan their face using the app. Then they can try on different shades of makeup using the app. If a customer likes their simulated look they can quickly and easily buy the products through the app. Within the app customers can also take makeup tutorials. For example, if a customer takes a contouring tutorial the app will overlay the contouring look on the customer’s face digitally. It is an excellent example of personalization at an individual level. In the first four weeks after the app was launched in 2016, Sephora had over 2 million unique visitors.