Data Personalization for Companies

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Introduction

Social media and digital devices’ proliferation is increasingly empowering consumers, allowing them to dictate what they want and when they need specific products and services. Notably, the evolution has made consumers both creators and critics, demand more personalized services and anticipate getting the opportunity to influence the services and products, they consume. Data personalization is growing so increasingly critical that businesses that will fail to incorporate any elements of personalization risk losing customer loyalty and experience adverse revenue outcomes. Companies are now faced with the challenge of mass personalization to compensate mass production models meant to satisfy as many clients through numerous distribution channels. Considering the recent developments in personalization, this report presents data personalization from the global, business and organizational, and individual-level perspectives. Precisely, the report analyzes personalization from the value exchange, customer trust, and legal lenses.

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Data Personalization from a Global Perspective

Data Value Exchange

Value exchange appears to be the most appealing incentive for consumers to share information with the leading brands. The reviewed literature, especially Fenech and Perkins (2019, p. 6), shows that about 22% of consumers are willing to share personal information, expecting personalized products or services in return. While most people could think that prices significantly impede profitable personalization from a business perspective, the latter literature reports that one in five consumers express the willingness to pay as much as a twenty percent price premium for customized products. Notably, premium brands stand to benefit significantly from personalization and the data exchange phenomenon that is transforming marketing over time.

Customer Trust

Personalization may be growing increasingly popular, yet it faces significant impediments emanating from customer trust issues. Copious research has been conducted on the topic, and the findings are that consumers are comfortable holding on to two contra opinions about data sharing simultaneously (Mole, 2015, p. 5). On one side, product and service consumers are adamant that marketing should be timely, targeted, and relevant. On the other side, the same consumers show limited willingness to share information that enables brands to meet these expectations unless they obtain numerous assurances.

The Legal Perspective

Regardless of the opportunities and challenges, a significant proportion of marketing leaders are surprisingly unconcerned about managing data privacy and security. A survey of the leading marketing executives revealed that close to 64% of businesses do not envision that privacy and security restrictions are likely to limit the current personalization practices (Boudet et al., 2019, p. 2). The same study reveals further than 51% do not think that consumers are likely to impede access to private information. However, the findings are contrary to the realization that a growing number of consumers are increasingly concerned with digital privacy, with close to fifty percent of them limiting their online footprints, fearing privacy breaches that could result in a misuse of critical information.

Data Personalization at the Business and Organizational Level

Personalization has achieved significant benefits for global businesses, explaining why many companies and brands strive to adopt more data analytics and related strategies into their operations. Numerous examples of successful data personalization exist in practice. In many cases, this sector’s developments draw from the rising preference for more product and service personation. The trend is surprising, considering the low number of consumers preferring personalized products and services. Consumer businesses are now challenged with converting client interests into customized offerings for profit.

Kennedy City Bicycles, a flourishing business located within the London metropolis, is an exemplar of a business-level data personalization strategy. In many ways, the business exemplifies the challenges of mass personalization from where James Kennedy, the company’s owner, struggles delivering mass customized bicycles to his clients (Fenech and Perkins, 2019, p. 10). Nonetheless, Kennedy City Bicycles has managed to grow its brand reputation over the years by allowing its clients to design bicycles, which are then produced in the company’s workshop. According to the latter cited literature, the company runs a corporate website, allowing consumers to interact with the proprietor to design bicycles that will be delivered to address specific needs.

The company does not operate any physical stores from where its consumers can purchase bicycles. Instead, Kennedy City Bicycles focuses on creating a holistically seamless online experience for its clients using data personalization. According to Fenech and Perkins 2019 (p. 10), Kennedy City Bicycles’ consumers undergo a decision tree from the start, helping them to engage in the process of creating products of their liking. The proprietor engages a slightly younger generation, considering their technological abilities compared to the older ones. Nonetheless, customer experiences drawn from personalization enable the business to make considerable profits since most of its customers are willing to pay premium prices for customized bicycles.

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The Kennedy City Bicycles case study operates in line with the extant literature’s description of data personalization. For example, according to Fenech and Perkins 2019 (p. 10), consumer technologies, including tablets and smartphones, have played a critical role in engaging clients personally beyond the digital space. In many ways, Kennedy City Bicycles manages to reach its clients in real-time when they choose to participate in the design process. As the previously cited study indicates, Kennedy City Bicycles benefits by ensuring it improve its relationships with clients through manufacturing what suits its clients’ needs. The company can then follow up with its consumers with targeted communications to better their personalized experiences of the products obtained.

Kennedy City Bicycles enjoys data personalization from the data value perspective. Notably, consumers are willing to share critical information with the business because they realize that they will benefit from their experiences with the manufacturer. Consequently, they trust the company will use any personal information responsibly. Therefore, Kennedy City Bicycles does not experience noticeable customer trust issues because it only depends on willful participation in the design process. Most of its clients gladly welcome follow-up communications, considering that they trust that such engagements are likely to enhance further cooperation and experiences. Lastly, while the business may face legal challenges to its personalization campaigns, it is notable that such events are yet to arise because most of the engage consumers from an informed consent perspective, where everyone visiting the website understands that their input is necessary for developing a product to meet specific specifications. However, in the future the company may want to consider the legal challenges to administering customized production processes and the how-to handle critical consumer data. (12)

Data Personalization at Individual Business Level

The Watch Me Now App

Drawing from the benefits of data personalization at the global and organizational levels, it is possible articulating similarities with the Watch Me Now App businesses developed previously during the course. Notably, Watch Me Now is a streaming service app that offers a wide variety of award-winning TV programs, films, animation, and documentaries on internet-connected devices. We considered the application due to current circumstances occasioned by the ongoing Covid-19 pandemic, which has forced people to spend most of their time at home. In this case, it is notable that the entertainment and media demand is growing in this sector, and we believe that our App will have a positive impact on customers. Watch Me Now can be operable on a smartphone, tablet, smart TV, laptop. Plans range from £3.99 to £11.99 a month. Compared with the other streaming apps, we offer two months trial for our services, and the video quality is 4K at the lowest price on the market.

Proposal to Address Value Exchange

The Watch Me Now App business envisions to benefit from personalization to build its brand reputation and customer relationships. The company needs to adopt a strategic marketing plan, considering the venture is in its infancy stage in a significantly competitive market. The management will draw from evidence-based recommendations to develop a business model that operates according to clients’ needs (Anshari et al., 2019, p. 94). First, the App will depend on email and social media personalization, where consumers will identify themselves to the App by subscribing to special content notifications, including new releases. Consequently, consumers will be required to provide critical information about their preferences that can then be analyzed, and the resultant analytics be applied for personalized content generation (Fenech and Perkins, 2019, p. 6). Precisely, the company will use the developed analytics to develop targeted email and social media advertising for its business.

The business will consider the value of the data collected from clients in developing a reputable brand. Personalization is significantly reliant on data, which has bolstered brands’ ability to deliver more targeted individual experiences to clients. Resultantly, the management comprehends that personalized experience has become the baseline of customer expectations. The extant studies report that the phenomenon has resulted in a dilemma for companies worldwide, mostly because clients have grown their understanding that brands need their data (Vaccaro, Wiggins, and Greulich, 2019, p. 2). The management realizes that consumers feel that their data benefits companies and their brands, creating concerns about what customers stand to benefit from when they share critical information. Conventionally, brands have addressed these concerns by gifts, vouchers, and offers to their customers, but the tactic has been gradually wearing thin.

Proposal to Build Customer Trust

The App business will also use the account customization strategy for its service and product personalization. The previously cited literature reports that account customization is the commonest personalization strategy in which consumers may personalize content once they create an account (Colace et al., 2015; Nesamoney, 2015, p. 103). The consumers identify themselves, allowing the business to tailor content to meet their specific preferences. Usually, the process will entail adding or deleting content and customizing quick links to particular content regularly accessed by each consumer. In this case, the company may also use the consumers’ cookie history to customize the content, eliminating the need to log in to the App.

The business considers the extant customer trust dilemma in which clients understand the value of sharing critical information with companies, but still show reluctance to share such information. For example, one research found that as little as one percent of consumers trust advertisers to handle their data. Yet, twenty-seven percent are willing to sell critical data, with up to forty-one percent believing that their personal information is as expensive as five hundred pounds a year (Mole, 2015, p. 6). As the previously cited study reports, consumers are increasingly worried about stalker media, with fifty-four percent of them concerned with how companies handle useful data. At the same time, a significant proportion of consumers are willing to receive customized product and service information and understand the implications of sharing personal data in the relationship. Therefore, the proposed strategy will help address the issues, growing its brand to compete the established ones.

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Proposals to Work within the Legal Framework

In focusing on capturing value, it is reported in the extant literature that executives are often ignoring their defense side of collecting and using personal data from consumers (Hanson, 2020, p. 1). Notably, personalization at scale faces privacy and security challenges for data collection volumes to enable personalization. The escalation of enterprise risk of gathering, storing, and utilizing consumer data also raises the business-impeding effects for companies that fail to get the right balance. The European Union advocates stronger privacy and security regulations through the General Data Protection Regulation (GDPR) policy enacted in 2018 to guard against data misuse, granting individuals more control over critical information. Many marketers feared that the regulation would impede their strategies, but they have learned its importance, noting significant improvements in their communications with clients (Hanson, 2020, p. 1). As much as regulations differ across global jurisdictions (the world is not close to adopting universal data privacy and security laws), every country or region has a specific framework promoting responsible data use, implying that careless use of critical information may adversely affect personalization for major global brands.

The business is aware of the legal implications of using consumer-generated data from a privacy and security perspective. First, the preferred personalization strategy may easily contravene the set GDPR privacy and security provisions that insist on customer-controlled information sharing. In contradiction, the business model envisions a non-consented approach to data personalization drawn significantly from the consumers’ interaction with the App. Therefore, the scenario suggests that trust issues may arise from the customers’ end because of their desire to limit sharing private, critical information that could be manipulated for other uses apart from personalized content delivery.

Proposal for Social, Economic, and Environmental Impacts

Contemporary businesses are aware of the need to adopt sustainable strategies, which contribute holistically to the social, economic, and environmental realms. Consequently, researchers propose different methodologies for achieving these goals, including corporate social responsibility (Williams, 2013, p. 45; Žukauskas, Vveinhardt, and Andriukaitienė, 2018, p. 34). As the latter literature explicates, organizations need to explore their profit motives alongside ensuring environmental conservation and the social welfare of communities in which they operate. The App venture will strive to articulate each of the identified elements of the corporate social responsibility model in its operations.

First, the company must always explore its profit model through targeting growth in its sales volume and a strong brand reputation that will guarantee strong financial performance. The firm will also consider the social wellbeing of its customers by investing in different projects to benefit communities. Precisely, the company will promote its employee’s wellbeing by promoting healthy social relations, flexible working conditions, and other benefits. Lastly, the business operates an online model, which lowers its environmental impacts. Furthermore, the company will champion green energy solutions to handle global warming caused by unsustainable energy sources. Collectively, the proposed strategy describes the App business’s corporate social responsibility plan.

Data Personalization Theory and Reflection

Personalization Theory

Theoretically, businesses are supposed to leverage data collected from clients to achieve the best-customized production standards. The prospect of personalization as a marketing and promotion tool depends significantly on the companies’ ability to invest in the required technological capabilities (Boudet et al., 2019, p. 3). Precisely, big data and associated technologies are critical in ensuring that businesses understand critical consumer trends, which aids in producing customized products to suit their needs. However, it is understood that improper planning and execution could be impeded from different perspectives, especially the legal and customer trust considerations.

While many theories explain the personalized marketing concept, I realize that Maslow’s model suits data personalization. The theory concerns human motivation in diverse fields. According to the model, humans lose the motivation to satisfy higher needs when they realize that they have failed to meet the basic ones. Nonetheless, they strive to achieve better results and satisfy higher-level needs when they feel that they have handled those at the base of the hierarchy of needs. Much as Maslow’s model has diverse applications, it is suitable for explaining the personalization concept and why it has suddenly transformed corporate operations.

The theory has critical implications for personalization. The rationale draws from the realization personalization is a marketing strategy, which depends significantly in customer motivation. The theory supposes that businesses have to work relentlessly to win their target client’s trust and motivate them to share critical data to help in personalization. Notably, consumers are curious, tending to limit the extent to which they share critical data and watch over brands to use the collected information. As conceptualized, the theory holds that consumers are motivated to share personal information when they expect that brands are likely to use such data to customize products according to their needs. Therefore, the relationship depends on corporate efforts to satisfy client’s basic needs, which they draw from consuming customized products. The future of customization is pegged on the extent to which companies will understand their consumers’ changing needs and use the data they collect to produce products and services meeting the desired standards. The relationship between brand development and motivation explains why the App business described previously is likely to flourish in the wake of growing competition from firms adopting a similar model of service delivery.

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Reflection

The course introduced critical concepts about data personalization. The core of the learning process was the role of data in developing customer-centric products and services. Notably, data personalization is growing in prominence worldwide. I learned that personalization is growing in prominence worldwide because it sums up as a marketing strategy, helping global organizations grow their brands. Importantly, the course created the understanding that companies understand the critical role of client data in helping businesses comprehend consumer preferences. Personalization, I learned, has evolved alongside the emergence of assistive technologies, which global organizations adopt to gather, store, analyze, and use client data to benefit simultaneously.

Personalization may be the new way of growing businesses worldwide, but I realize that brands face significant security and privacy challenges, which they need to address to motivate consumers to share critical data. The issues arise from the fact that consumers exhibit reluctance in sharing their personal information with corporations because they feel that such data may never be used for the right purposes. For example, one realizes that consumers are concerned that businesses may sell their critical data to third-party organizations, which occurs without their consent. In this case, the mistrust exists because customers think that companies gather critical consumer data to exploit the customers and build global brands at the expense of the target clients. Therefore, I feel that the existing trust issues need critical focus to help global companies benefit from personalization.

I used the motivational aspect of Maslow’s theory because I realize that trust issues between consumers and brands arise. After all, at times, clients do not sense the inspiration to part with information. In this case, the customers think that some businesses may benefit at the consumer’s expense. The mistrust kills consumers’ intent to share their private information with the companies, requiring an interventional approach to handle the challenges. Therefore, motivation is foundational to a sustained relationship between corporations and consumers in the era of evolving data privacy and security laws. In this case, I established that consumers will show their willingness to share personal data with brands only when they realize that the products and services obtained meet their needs. The theoretical concepts applied throughout this report suit the Watch Me Now App business developed to utilize data personalization.

Conclusion

Data personalization is gradually transforming into a norm for global business striving to satisfy their client’s needs through delivering products and services to meet specific needs. Customization’s popularity draws from an increase in data analytics tools that corporations now depend on to manage their relationships with clients. Maslow’s theory of human motivation best suits personalization as a persuasion strategy employed by companies worldwide. Precisely, the theory explains that humans are motivated to satisfy their immediate, basic needs before seeking higher-level satisfaction—they will be demotivated if they fail to satisfy survival needs. Similarly, advertisers are turning their attention to critical client information while realizing the need to repay their consumers by delivering customized products. Evolving legislation are likely to affect client-business relations by limiting the extent of information sharing, but companies may overcome the challenges by focusing further on customization. Consequently, the Maslow framework is beneficial to companies seeking to satisfy their clients.

Reference List

. Žukauskas, P., Vveinhardt, J. and Andriukaitienė, R., 2018. Management Culture and corporate social responsibility. Boston: BoD–Books on Demand.

Anshari, M., Almunawar, M.N., Lim, S.A. and Al-Mudimigh, A., 2019. Customer relationship management and big data enabled: personalization & customization of services. Applied Computing and Informatics, 15(2), pp. 94-101.

Boudet, J., Huang, J., Rathje, K., and Sorel, M., 2019. Consumer-data privacy and personalization at scale: How leading retailers and consumer brands can strategize for both. McKinsey & Company. pp. 1-6.

Colace, F., Santo, M. D., Moscato, V., Picariello, A., Schreiber, F. A., & Tanca, L. 2015. Data management in pervasive systems. New York: Springer.

Fenech, C. and Perkins, B., 2019. Made-To-Order: The Rise of Mass Personalization. The Deloitte Consumer Review, 1, pp. 1-20.

Hanson, G., 2020. DPR: What Have We Learned So Far And Where Is Data Protection Law Going? | Econsultancy. Econsultancy. Web.

Maslow, A.H., 2019. A theory of human motivation. New York: General Press.

Mole, J., 2015. Value Exchange from Data Exchange. Econsultancy in Association with Acxiom. pp. 1-31.

Nesamoney, D. (2015). Personalized digital advertising: how data and technology are transforming how we market. Old Tappan (New Jersey): Pearson.

Torn, I.A.R. and Vaneker, T.H., 2019. Mass Personalization with Industry 4.0 by SMEs: A concept for collaborative networks. Procedia manufacturing, 28, pp.135-141.

Vaccaro, A., Wiggins, J., Greulich, T. 2019. Analytics-Aided Personalization. The Deloitte Consumer Review, pp. 1-7.

Williams, O.F., 2013. Corporate social responsibility: The role of business in sustainable development. New York: Routledge.

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