Kellogg on Marketing, 3rd Edition

CHAPTER 23Personalization—Today and Tomorrow

Tom O'Toole

In the previous chapter, we discussed customer centricity as the most effective business strategy and marketing approach to achieve the goal of growing customer value. If we carry customer centricity all the way to the individual customer level, we end up at personalization. The aim of personalization is to grow customer value by working to detect, anticipate, and predict specific needs, desires, and preferences, and act proactively to customize our marketing activity to be most effective for individual customers.

This concept is not new. Its roots can be traced back to 1993 when the book The One to One Future: Building Relationships One Customer at a Time by Don Peppers and Martha Rogers laid out many of the one‐to‐one customer marketing concepts that we know today as personalization.¹ That was a few decades ago, and while the view that they presented was engaging, it wasn't really doable at scale in practice yet because the technology had not matured enough. Yet the potential clearly was already there.

Personalization hit the radar again when McKinsey declared it the “holy grail” of marketing in a November 2016 article. Personalization—which McKinsey defined as “the tailoring of messages or offers to individuals based on their actual behavior”—showed compelling promise for increasing marketing effectiveness and was developing rapidly. A growing range of progressive companies was working to enable and adopt personalization. ...