From Coke cans to shoes to menus: what’s behind the rise in personalised products?

Customised shoes, personalised drinks and specialised menu offerings. In a world where carbon copies of products are in all places, retailers should make their products stand out and supply customers with a singular purchasing experience.

The have to be different is even greater at a time consumers are being careful about what they spend. Businesses should work harder as they compete for the all-important dollar so price wars between retailers are common.

Personalisation, through bespoke products and personalised services has been listed by international business magazine Forbes as one in every of the ten biggest business trends for 2024.

It’s clear – and has been for years – personalisation appeals to consumers who wish to feel cared for and understood by their favourite brands. In fact, consumers are willing to pay more for the experience.

How businesses learn what consumers want

Companies are increasingly using what marketers call personalisation at scale by analysing large amounts of knowledge about individuals to deliver products tailored to their specific needs, behaviours and preferences.

This historical and real-time data is gleaned from consumers’ online purchasing and browsing behaviour, use of mobile apps, web searches, online shopping carts and brand loyalty cards.

E-commerce retailer Amazon personalises product recommendations based on consumers’ browsing and buy history, offering them the identical or variations of products they’ve bought or not less than checked out.

Similarly, entertainment streaming platforms Netflix and Spotify analyse their users’ viewing and listening history to grasp their preferences and recommend latest content.

Coffee giant Starbucks communicates with its loyal members via games of their mobile app and rewards loyalists with specialised offers and exclusive product trials. The games are personalised to every customer based on the information gathered from their past visits and interactions with the app.

Coke’s Share-a-Coke campaign, unveiled in Australia in 2011, was a successful example of the bond brands can create with consumers just by adding an individual’s name to the product.

The company branded its bottles and cans with the 150 hottest names in Australia and urged consumers to share a Coke with someone whose name adorned the label. The list of names later expanded.

L’Oreal’s most up-to-date innovation is their in-store technology that digitally scans each customer’s skin. The data obtained is used to supply a personalized foundation (from 72,000 possible combos) to match a person’s shade, level of hydration and coverage required.

Nike produces custom shoes in 1000’s of styles, colors and icon combos as they proceed to accumulate data integration platforms that help speed up the gathering and evaluation of consumer data.

Consumers want more from their shopping experience

In pre-digital times, personalisation was based on broad demographics and direct feedback from customers. It often resulted in personalised store interactions between salespeople and VIP customers, or tailoring store services. Personalisation was only reasonably priced to high-net-worth individuals.

But the digital age has made personalisation accessible to all consumers, not only the high end. Today’s shoppers expect unique experiences and can vote with their dollar. This is backed by research showing personalised experiences drive company sales.

The COVID-19 pandemic only made personalisation more urgent for corporations as consumers switched to latest stores, products, or buying methods, proving brand loyalty was a thing of the past.

Consumers now expect more value from brands. They wish to feel recognised and understood on a person level and never a part of the group. Personalisation at-scale allows consumers to feel empowered with their decisions. This feeling of psychological ownership results from designing your “own” product and may result in greater value and brand love.

Why personalisation works for the massive brands

Personalisation at scale offers corporations many benefits. It can reduce customer acquisition costs and increase revenues. Personalising experiences, when offered to hundreds of thousands of consumers, make it difficult for competitors to mimic, especially when brands use proprietary technology.

Personalisation also means less waste as brands produce what consumers want fairly than what they consumers want. After all, consumers who find products unique to them are less more likely to part with what they consider is their very own creation.

However, using predictive algorithms to assist brands analyse past behaviours (what you and others like you could have bought/watched) and give you decisions (at scale) will be imperfect.

Dating app Tinder’s reliance on algorithms to determine which photos users see has been criticised as flawed with very low reciprocal rates of interest between users “swiping right”. Understanding human behaviour requires intuition alongside algorithms.

If personalisation isn’t latest, then why the sudden hype?

Brands are rapidly embracing digital disruption. The digital revolution brought an influx of consumer data, but despite early algorithms, it was difficult for corporations to make sense of huge amounts of raw data.

Artificial Intelligence (AI) and machine learning have revolutionised this by enabling brands to make use of AI-driven methods to grasp their consumers and offer tailored content. In turn, consumers get to contribute to their product’s design.

Big brands like Nike and L’Oreal have the proper formula for personalisation and their customers are having fun with a singular experience. This is sweet news for large brands with large budgets and access to data, but less so for smaller brands with fewer resources attempting to compete for the shopper’s attention.

With the expansion of AI technology, we’ll start seeing open-source software with publicly accessible data that enables even the smallest brands access and know-how to make every experience bespoke.