What is Personalization?

Personalization is the automated process that tries to predict what the user wants next and presents it. The perfect implementation would be presenting the right content at the right time, every time.

Businesses use a number of techniques to try to produce that perfect implementation. Some of the techniques are simple ideas in complex implementations: keep track of what the customer did in previous visits and make guesses about what the customer does next. That’s what Amazon.com’s Recommendations process does.

Some sites use intricate processing that reviews that action you have just performed on the Web site and tries to present what you find most pleasing. The successful business uses a number of tools to engage in interactions with the user. The following list presents 10 reasons businesses might want to engage in personalization:

1. Provides the customer with convenience and save his or her time.
2. Allows the vendor to become a trusted source, building loyalty, customer retention and sales.
3. Enables a comprehensive, integrated, and intelligent customer communication strategy.
4. Allows the vendor to proactively present the customer with contextually relevant offers creating the potential to transact with each and every customer.
5. Provides a 360-degree view of the customer relationship, helping to better understand customer needs and habits.
6. Allows the vendor to focus on retention rather than acquisition, which is much more cost effective and dramatically increases customer lifetime value.
7. Offers faster and more accurate response rates to measure future sales.
8. Provides up-sell and cross-sell opportunities, driving additional revenue.
9. Creates a competitive advantage, building barriers of entry for new businesses.
10. Allows a more cost-effective way of doing business, improving sales and customer satisfaction.

Source: Software and Information Industry Association eBusiness Division Whitepaper: Conect with your Customers