Brand management in the age of hyper personalization

As consumers increasingly engage with their brands on a personal level and brands have unprecedented access to consumer buying behaviours, brand offers have become hyper-personalised. However as Sandeep Das, senior partner at BOD consulting, writes, hyper-personalisation risks eroding the core brand identity. He explores the ways in which brand can maintain strong brand identities while remaining relevant to individual consumer needs.

Consumers are drowning in advertising messages today. An average individual is exposed to around 5000 pieces of advertising in different forms everyday. We also have an ever increasing number of touchpoints, which adds to the complexity and noise. It has become critical for brands to create clutter-cutting advertising, which is memorable and drives the right messages.

But creating distinctive and memorable advertising is not enough. Consumers are much more evolved in terms of their engagement with brands. They do not implicitly trust brands anymore but actively seek information before taking any decisions. A study by Accenture revealed that 75% of consumers are more likely to purchase a brand, which offers personalised services based on individual preferences. In a survey conducted by Infosys, 86% of consumers mention that personalisation has “some impact” on their buying decisions and 25% mention that personalisation “significantly influences” their buying decisions.  Due to unprecedented access to detailed consumer buying behaviours and needs, brands now have in-depth understanding of consumer preferences. These needs can be addressed at an individual level, in a highly customised way and with the ability to scale. This has resulted in hyper-personalisation of brand offers.

The hyper-personalisation of offers creates significant challenges from a brand management perspective. Personalisation exerts immense pressure on core brand identities. If a brand is “different” for everyone, then in the real sense it is not a “brand” anymore. For marketers, maintaining a strong, cohesive brand identity while remaining relevant to individual consumer needs is now a critical balance to achieve.

There are some principles that brands need to follow to maintain strong brand identities in a hyper-personalised consumer marketplace:

• Maintain consistency, focus and depth in your communication with consumers
• Personalisation in the end product does not mean that the brand’s identity needs to be diluted
• Build the brand around personalisation and not the other way around
• Do not adapt brand offerings for every market, segment and sub-segment
• Do not allow personalisation to cause unnecessary proliferation of your brand’s range
• Approach personalisation through a broad lens that allows you to group consumer needs and preferences into a manageable number of distinct buckets
• Shallow personalisation destroys while thought-through personalisation enhances equity
• Strengthen your brand through a top-down approach (bottom-up causes fragmentation, confusion and dilution of brand strength)
• Do not consider every passing fad or trend as a catalyst for personalisation
• Build a strong brand as the foremost priority

Starbucks’ promise of making your coffee exactly as you want and Netflix’s recommendation algorithm are some great examples of hyper-personalisation. But they are strong brands first and are known for creating or disrupting categories. The same would be true for any luxury or premium brand offering personalised services.

It might seem like a puzzle when we talk about consistency and hyper-personalisation in the same breath. But if we look at brands that have successfully adopted personalisation as a strategy, both elements complement each other. When a brand’s core proposition is strong, it has the freedom to explore wider consumer needs. This allows it to embrace varied customer expectations smoothly and deliver on them. Personalisation is also not about embossing names on products. It is about shaping the whole product offer to individual preferences, which is a carefully thought through strategy.

Disciplined brand management is a critical need in an age of shifting consumer preferences. In its absence, a brand is highly susceptible to fragmentation, equity dilution and weakened perceptions. Marketers need to approach personalisation as a platform to strengthen brand credentials and get closer to consumer needs, but not to allow it to weaken a brand’s foundation.