*Tech Companies Forecast the Future of Personalization

BOSTON — Pioneers in an evolving field of marketing technology believe the level of personalization permitted by Internet and wireless products will completely transform the way merchants do business, and here, in a city historically famous for revolution, they found an audience eager to learn about the changes they see for the future.

More than 1,100 people showed up for the Personalization Summit 2000, a conference organized by the Peppers and Rogers Group, software firm Net Perceptions and a host of technology firms that help online and offline businesses instantly personalize their interaction with customers.

Direct mailers and printing companies long have known about the effectiveness of personalizing customer messages. But communicating in a personal way with consumers every time marketers interact with them electronically makes for a much more complex situation than merely making sure you get their name right in a pitch letter greeting line.

“In effect, personal attention literally has become a new currency in the electronic markets,” said John Hagel, principal at consulting firm McKinsey & Co., Palo Alto, CA.

The new marketing playing field, the personalization technology proponents argue, will require the abandonment of traditional branding and DM techniques such as intercepting consumers with “shotgun messages” and trying to prevent buyers from making shopping comparisons or discovering negative word-of-mouth about their goods. Instead, e-commerce merchants should focus on drawing consumers and holding them.

“You have to make them want to come to you by being more helpful to them,” Hagel said. That includes helping shoppers with pre-purchase comparisons and then using electronic networks to hook consumers with third-party vendors and services “to add even more value to that customer’s relationship.”

Consumers have become more powerful as they select which businesses will get their personal preferences. And instead of attaining the long-sought-after “one-to-one” model, marketers will find consumers have instant access to many marketers at the same time through comparison shopping engines that have their personal preferences, speakers said. Consumers now can find out what businesses pay for the goods they sell, what their rivals charge, and how well they satisfy their customers.

One of several Summit speakers who focused heavily on the future rather than the here-and-now was John Riedl, a pioneer in collaborative filtering technology. Such technology chooses product pitches based on each consumer’s similarities to other groups of buyers. Also the chief scientist at Net Perceptions, Riedl foresees a day when Web-based and hand-held devices will automatically tell consumers whether an e-commerce site's privacy policy is stringent enough for that consumer’s preferences.

But wireless devices will go much further toward reshaping commerce, according to Michael Saylor, founder and CEO of e-business software firm

MicroStrategy Inc., Vienna, VA.

“I think they’re going to change the balance of power between the traditional [marketers] and the individual,” he said.

In Saylor’s view, narrow, quick messages that fall within a category consumers have personally said they want are the only wireless pitches that will get attention. Eventually, such regular familiarity with personal marketing communication will lead consumers to simply hand over permission for marketers to transact on their behalf without notifying them ahead of time, he said.

“You’ll see a world where Alan Greenspan changes the interest rate, and 467,000 mortgages get refinanced within 60 minutes,” Saylor said.

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