Part 3 | Hyper personalisation

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Part 1
Hyper
Personalisation_
Part 3:

INTRODUCTION AND CONTEXT_
We are all aware of the significant and rapid advances in technology over the last two decades. The
question that many are struggling to answer is, “what does this mean for my business?“ In the fields of
big data analytics, machine learning and artificial intelligence (AI), there have been advancements that
are drastically changing not only when, where and how customers shop, but also how they engage with
brands. While there is a temptation to focus on the technology, these changes represent a significant
shift in what customers now expect and that is where we should focus our energies.
Yellowwood’s research report How Technology is Changing Customer Expectations identifies four shifts that are
likely to have the largest impact on how organisations should adapt if they aim to remain relevant and meet (or
ideally exceed) customer expectations, given the rapid and disruptive developments in technology.
*Access reference list in the full report

There are four
expectations, all
rooted in
customer needs,
identified and
explored in this
presentation

www.ywood.co.za ‫׀‬ 4 *Access reference list in the full report

HYPER PERSONALISATION_
The shift to a more individualised society that values experiences more than goods has resulted in a
strong drive towards personalisation. Societal changes such as living with parents longer, getting married
later and living longer, healthier lives create the time and resources to lead a life more focused on meeting
our own needs and desires rather than those of our families or employers.

Many large organisations believe that personalisation is not feasible, however technology has enabled
different approaches that make customisation at scale not only possible but profitable.

Product customisation – NIKEiD
The first approach is to personalise
products. NIKEiD allows customers to
design their own products based on a wide
range of options and have them delivered
within 3 – 5 weeks. This offering is now
extended to one of their other brands,
Converse. This has required the brand to
develop strong direct-to-customer (DTC)
purchasing and delivery channels,
something that had previously been
handled predominantly by retailers.
The benefits to Nike have made it a
worthwhile initiative not just in terms of
brand perceptions but also additional
revenue, and a gross margin increase of
1.4 percentage points. By 2015 DTC sales
contributed 22% of Nike’s total revenue,
and in 2017 it accounted for 30%.

Customisable software – Oakley
The second approach is to build
customisable software into your products
that can offer personalised advice. Oakley
partnered with Intel to create the Radar
Pace training sunglasses with builtin
earbuds that respond to voice commands.
They have a virtual coach that offers
personalised data, guidance and
encouragement during your workout.
A significant benefit of this approach is that
it builds credibility through demonstrable
expertise in addressing a genuine
customer need. This broadens the scope
of innovation, making category leaps less
risky and more credible in the eyes of
potential customers.

Customisable packages – L’Oreal
The third approach is to sell standardised
goods, but offer them in customised
packages. A brand that has been
experimenting successfully with this
approach is L’Oreal. In 2014 the company
launched the ‘make-up genius’, an app using
Augmented Reality (AR) technology to allow
users to scan their faces and experiment with
L’Oreal’s vast range of make-up products.
Users can try individual products or complete
looks, as well as make in-app purchases.
With over 20 million users globally and
product trials up by more than 65 million in
2015, L’Oreal may not be making unique
products for individuals, but the ability to
customise a basket of goods, creates a
feeling of personalisation. This strategy
appears to be delivering strong results for
L’Oreal whose ecommerce sales rose by
36% year-on-year in 2017 and whose
strategy is to become “a leader in digital
beauty” through more personalised
interactions with customers.

In applying this expectation to your business there are a few questions to consider:
• How can I engineer a customer-centric strategy in my business to ensure personalisation at scale?
• How can I segment my customers to the individual?
• How can I focus and own a particular kind of customisation in my industry?
Questions to consider

For more information on each of the
expectations and the associated
challenges and recommendations
download the full report via the link below
or visit www.ywood.co.za
Alternatively email us at
info@ywood.co.za

Part 3 | Hyper personalisation

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Part 3 | Hyper personalisation