PERFECTING THE ECHO CHAMBER - Cheil UK · customer experience? LOYALTY, DATA AND CUSTOMER CARE TODAY PERFECTING THE ECHO CHAMBER //3. 0% 5% 10% 15% 20% 25% 30% 35% Tailored offers

P E R F E C T I N G T H E E C H O C H A M B E R

P U T T I N G C R E A T I V I T Y I N T O D A T A - D R I V E N M A R K E T I N G

https://cheil.uk

I N T R O D U C T I O N

P E R F E C T I N G T H E

E C H O C H A M B E R

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Is it about streamlining a process, introducing convenience

for the customer, finding a way to gather yet more data?

And when we have that data, do we know what we’re trying

to achieve?

Customers want great service from brands but both they

— and brands — are still in the process of discovering

exactly what that means. On the one hand, the customer is

shouting ‘treat me like an individual!’, on the other they’re

yelling ‘... but don’t be a creep!’. It’s clear that with all this

data, we’re still not hitting that customer sweet spot. We

still can’t find the trigger that guarantees a customer stays

loyal and is an advocate for the business.

The reason might be that we can’t see the wood for the

trees. We’re so obsessed with the forensic collection and

precise deployment of data, that we’re forgetting what

personalisation really means.

This report will look at what customers really think about all

this frantic data gathering, about what they expect to get

out of loyalty and what brands really should be doing with

all this information.

It shows that customers are sick of being treated like a

science project. We’re going to show that there is art

in the science and creativity in the data, and that loyalty

means so much more than ‘15% off.’

WHAT DOES PERSONALISATION MEAN TO BRANDS?

S E C T I O N O N EBrands are desperate to secure loyal customers. There

isn’t a sector out there that isn’t highly competitive,

with rivalry not just between players, but between

sectors too. Travel is vying with technology; retail with

experiences. It’s going to take more than a discount

to keep customers on-side.

To understand how customers feel about brands’ efforts

to bring them into the fold, Cheil conducted a wide-

ranging survey across 1,001 UK consumers. We set out

to discover their perceptions of loyalty and what they

think about the ‘value exchange’ for data. Do companies

really live up to their insistence that their top priority is great

customer experience?

LOYALTY, DATA AND CUSTOMER CARE TODAY



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0% 5% 10% 15% 20% 25% 30% 35%

Tailored offers to

personal circumstances

Access to partnership programmes,

e.g. airline rewards

Privileges, e.g. exclusive

access to events

Discount offers, e.g. wine club,

travel etc

Cashback

Discounts or cheaper premiums,

e.g. cheaper car or health insurance

Advanced money management

features on mobile apps or website

How likely is it that the following factors would encourage you to share your data with a brand?

13.9%

8.1%

35.2%

30.8%

12.1%

15.4%

9.5%

34.1%

28.7%

12.4%

14.0%

10.5%

33.3%

29.8%

12.5%

14.5%

9.5%

30.8%

30.1%

15.2%

9.0%

7.3%

24.4%

34.1%

25.3%

12.1%

7.6%

28.8%

34.5%

17.1%

18.3%

12.2%

35.8%

22.4%

11.4%



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Consumers are lukewarm at best when it comes to sharing

data for perks. The response was largely neutral (neither

likely nor unlikely) when it came to partnership programmes

(34% of respondents), money management features (36%)

or bespoke offers (35%).

They were not completely unreceptive, however. Financial

rewards spurred some action, with 35% of respondents

saying they’d be ‘somewhat likely’ to share data for cheaper

premiums, and 34% willing to trade it for cashback.

There wasn’t a significant gender split, with men (48%)

marginally more likely to share their data than women (42%).

The difference in age groups was much more marked, with

only a third of people over 55 willing to exchange data for a

prize, compared to 53% of younger people (25-54).

SWAPPING DATA FOR PERKS



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Few consumers wanted companies to use the data they

shared to provide recommendations, particularly if the data

seemed personal, such as tracking their movements. Of all

the personalisation options, ‘None of the above’ was the

most popular, with 34% of the survey audience selecting

this option, while more than half of over 55s ticked that box.

Only 23% overall were content for tracking to be part

of recommendations, while even fewer (13%) were happy

for their credit information to be used to recommend cards

or loans. A glasses company recommending eyewear was

deemed ‘Okay’ with 33% of respondents.

Women were less happy with sharing their data than men,

and the latter were primarily concerned with saving time

(queueing) or money (discounts).

However, this position reversed when it came to the

spectacles recommendations, above (26% versus 17%

of men). Consumers in general were happy to share their

health data when it was likely to serve the common good,

such as improving diagnosis (62%).

Similarly, highly personal health devices whose data had

an immediate benefit to the wearer such as a watch

were also okay by 61% of respondents. One astonishing

finding is that a third of consumers would be happy

to share data as intimate as their own DNA information

with supermarkets in exchange for health advice. This

is growing evidence that it is not necessarily about

how famous your brand is when using customer data

(although being a fundamentally trustworthy brand is a

given), but what you do with the information.

SHARING FOR A WORTHY CAUSE

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

TOTAL MALE FEMALE

A company uses your credit information to recommend the best credit cards andloans based on your individual circumstances

A company that recommends what products you should buy or content you shouldwatch based on previous activity

A coffee shop that remembers your regular order and allows you to order and skipthe line with the click of a button

A glasses company that recommends what glasses will look best based on your faceshape based on facial tech

None

Some brands are now tailoring their experience to the consumer based on

shared data. Which of the below do you think would be most useful?

Strongly agree Somewhat agree Somewhat agree Strongly disagreeNeither agree or disagree

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

A Supermarket storing DNAdata to recommend the best diet

for you to maintain healthy weight

A skin care brand using your DNAto recommend the best skincare

and anti-aging solutions tailored to you

A watch that is able to store health dataand detect when something may be wrong

(e.g. a heart attack)

Your GP sharing data with doctors andhealthcare providers, comparing your data

with other patients to help make a diagnosis



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Customers appear to base their loyalty to high street

retailers on a quality value proposition and heritage.

The bargain basement, pile them high, sell them low

environments, where it’s all about the price and the

experience is a very low priority, seems to turn customers

off. Here, we outline what customers say they prefer but in

Section two we’ll see there’s more behind the numbers.

Boots, Marks and Spencer and John Lewis all score highly

for best in-store experience with 43% of consumers from

Northern Ireland giving it top spot and 27% of respondents

overall. Women were most attuned to the Boots experience

(31%) compared to less than a quarter (23%) of men.

However, it tended to be the youngsters (16-44) who

preferred Boots as their top high street draw, while the

over 45s preferred the Marks and Spencer experience. This

is somewhat surprising, given the restructuring and job

cutting programme Boots is currently undertaking in 2019.

Functional, deal-based retailers earned the wooden spoon,

with JD Sports disappointing consumers in Northern Ireland

and Scotland in particular. WHSmith and Aldi didn’t fare

much better, although women were less critical, as were

older generations.

RETAIL LOYALTY IS A COMPLICATED PICTURE

It’s clear that the old model of reward — or incentive —

to elicit the desired customer behaviour has moved on.

Saturated markets delivering extensive choice and high

price competition have diminished (although not destroyed)

the value of old-style points systems. Customers want

more than a small discount, they want recognition for their

loyalty. But even here, it’s a tricky landscape to navigate.

Companies are equipped with ever more sophisticated

technology to discover intimate details about individual

customers’ lives. With it, and a dash of automation, it is

possible to deliver highly personalised, relevant experiences —

in real time. However, customers appear ambivalent at best

about such close surveillance without full permission and

demonstration of the value.

We clearly stand at the crossroads between an out-

dated but not entirely obsolete model and the power to

deliver services that, in their current form, customers do

not feel represent enough value for their data. In Section

Two we look at the challenges businesses, particularly those

in Travel, FMCG, Automotive and Retail, are facing when it

comes to securing growth through customer loyalty.



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RETAIL LOYALTY IS A COMPLICATED PICTURE

Which of the following high street retailers do you feel

offers the best in-store experience?

Boots M&S John Lewis None of the above

Wilko Waitrose Apple Lush Specsavers Metro Bank

4.2%

12.4%

15.6%

27.4%

15.7%

16.2%

19.3%

20.7%

21.8%

27.3%

Which of the following high street retailers do you feel

offers the worst in-store experience?

None of the above ArgosJD Sports WHSmith Aldi Carphone Warehouse

Currys Halfords B&Q Boots John Lewis Marks & Spencer Sainsburys

5.9%6%

6.4%

6.8%

31.6%

9.5%

9.1%

11.6%

12.5%

14.6%13.8%

15.2%

18.5%

S E C T I O N T W OOne thing is clear from our research. Customers know

marketers want their data. They’re even reasonably content

to share it. A financial perk in return is certainly welcome,

although not the be all and end all. But so far, consumers

remain unimpressed about what we are managing to

deliver in terms of goods and services with their data.

Take their complete ambivalence towards recommendations.

Even when it comes to something useful, like comparing

complex financial products, consumers are not too excited.

Why is that? Because recommendations have become

suffocating. Marketers believe they have painted such an

intricate picture of their customer, real or imagined, that

they absolutely know what’s best for them. In a bid to

deliver the best, most convenient, seamless customer

experience, we’re locking our customers in an echo chamber,

featuring only the narrowest of options.

Take Netflix, for example. Some of us will remember

Blockbuster Video stores and the paralysis of choice

standing under the striplighting, staring at ranks of DVDs

(or VHS videos if you’re really old) and worrying that you

were about to ruin Friday night with a bad choice. So

hurrah for Netflix and its suggestions based on what

you’ve watched before.

Except, it only takes a brief binge on cheesy martial arts

films for your recommendations to be filled with kickboxing

schlock for evermore. Check out your partner’s profile and

suddenly there’s a whole new world of diverse entertainment

gems you didn’t know about it available. That’s the danger

of over-targeting.

BALANCE DATA AND CREATIVITY



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Customers end up parked in these echo chambers because

of over-targeting and a lack of understanding about what

personalisation really is.

The mantra is data is the new oil. And so we have

developed a mania for gathering as much of it as possible

and then trying to squeeze until the pips squeak. There are

two problems with this. We have lots of data, but we

still don’t have all of it. We can find out a lot about what

customers have done, but their likes and motivations?

Those are still a bit of a mystery. And secondly, customer

activity, however much we gather of it, is still too narrow a

data set to make customers happy.

Brands need to relax the reins a little. Stop thinking about

personalisation as a 100% sales hit rate every time. Instead,

start thinking about it as the starting point on a voyage

of discovery.

TARGETING VS PERSONALISATION



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Personalisation isn’t personalisation at al l . It ’s systematisation and standardisation.

A personalised approach provides the opportunity to be creative.” Says Chris MacLeod, Director, Customer and Revenue at Transport for London.

“

BRING BACK THE ELEMENT OF SURPRISE



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People are designed to crave the unexpected.” According to Dr Read Montague, associate professor of neuroscience

at University College London (UCL).

That doesn’t mean trying to sell a Lamborghini to a tractor enthusiast,

but it does mean getting creative now and again.

“Social network TikTok serves users content based on their

likes, behaviours and who they follow — so far, so social

media. But it also dishes out a healthy amount of random

content. Easily skippable if it’s wide of the mark, utterly

compelling and suddenly attention-grabbing otherwise.

It works in the real world too. Perhaps in a backlash against

the utterly boring predictability of online shopping, there

has been a rapid rise in ‘surprise’ monthly subscription

boxes from companies such as Geek Gear, Bookfulness,

Papergang and Birchbox. Grown adults, fed up of getting

just what they want as presents thanks to wish lists, are

actively sending themselves monthly surprise gifts of

make-up, books and film merchandise.

Matt Gratze, Digital Director at Halfords:

“The online world is changing how efficient we expect a

business to be, and the ‘always on’ culture leads to

customers expecting 24/7 service (or as close as

possible), and this is expected across all devices and

touchpoints as a part of an omnichannel service.

Customers expect personalisation, through promotions

and special offers, useful product feedback, which

ultimately provides a data loop for us to improve our

products, services and marketing activity.”

Understanding the customer and putting yourself in their

shoes is true personalisation, not just looking at their data

and matching it to inventory to put the square peg in the

square hole. Instead of using that data to target, we need

to use it to be creative and to deliver surprises. We need to

keep it interesting.

S E C T I O N T H R E EPersonalisation that shows how much you know a customer,

rather than how much you know about a customer, is the

key to finding those surprise and delight moments. Being

willing to tell the story of your relationship and develop

your customer’s interest further is how you move data

beyond process and into creativity.

“Personalisation comes at the cost of creativity if the

content is algorithmic. But it can also have creative flair if

the customers are in cohorts and there’s different

creative for each. Clearly, the cost and complexity of

creating cohort creative [has to be] offset by the

improved commercial return. There is a balance to be held.”

Gary Kibble, Marketing Director, Sainsbury’s Argos.

CREATIVE DATA IN ACTION



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Surprise doesn’t always come from fireworks. Yes, even

email personalisation can be creative and surprising — two

things you really want from a travel company but two things

that can often be sadly lacking.

EasyJet showed best practice with nearly 12 and a half

million unique emails sent to customers, detailing each

individual’s travel journey with them so far, as the airline

celebrated its 20th anniversary.

Each individual story featured where and when they first

flew with EasyJet and then made a suggestion about where

they might fly next. But while a single suggestion was based

on the customer’s flying history, the airline didn’t just

stick to the algorithm. In fact, the copy quite clearly

stated ‘your journey’s only just begun’, flagging up the 250

destinations to choose from as well as offering a portal to

the top 20 as chosen by easyJet themselves. Open rates

were 100% higher than its typical newsletters.

CREATIVITY ONE-TO-ONE



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It ’s hard to be good at [personal isat ion].Even the best peopleare bad. When it works,it works, but you haveto be good at it.” Chris MacLeod, TfL.

“

While it’s clear that the consumer finds too much tracking

during a physical journey an unsettling experience, that

doesn’t mean they’re not open to genuinely useful, intuitive

experiences. Technology from a practical perspective is

particularly welcomed.

Our survey found that consumers want to feel in control

when technology affects their shopping experience. Useful

facilities such as ticking a screen in-store to arrange quick

home delivery was popular with 30% of respondents.

The chance to return an item was something 29% would

appreciate. Most weren’t fans of revealing their online

product search habits to in-store staff, however (only 12%).

Women value technology as a bringer of convenience more

than men (34% for home delivery versus 26%). Men, on the

other hand, were more enticed by technology as in-store

entertainment than women (18% versus 13% would enjoy

a VR or AR experience). Older consumers have yet to be

convinced that technology would add any value at all, with

39% of 55+ year olds choosing no tech solutions at all.

In 2018, Samsung revealed first-of-its-kind retail technology

that joins up the online and offline experience for customer

looking to buy a mobile phone. Dynamic in-store wall

bays provide the link between digital and in-store, giving

individual shoppers relevant, tailored information at the

point of purchase. It gathers in demographics and device

preferences to help customers make decisions.

CREATIVITY ON THE SHOP FLOOR



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Only 20% of customers purchase a new mobile device on the internet, [so] customers in-store account for the large majority of purchases. Historically it ’s been very difficult to understand and tai lor to.” Stephanie Doyle, Senior Omni-Shopper Initiatives Manager — Omni-Channel Innovation Team (SEUK).

Data-driven creativity doesn’t just surprise and delight, it delivers results. Samsung saw a 41% uplift

in the first 12 weeks, coupled with a significant increase in engagement.

“

1 2

S E C T I O N F O U R

KNOW WHAT YOU WANT TO ACHIEVE

It sounds surprisingly basic but understanding what you want

a great customer experience to look like and how you expect

it to deliver results has to be the place to start.

What do you want engaged customers to do? Buy more

is always a priority, but it’s not the only objective. Do you

want customers to stay for longer, interact more regularly

with social, become vocal advocates across marketplaces,

self-serve on digital or visit physical stores more often?

Knowing what the expected outcome will be helps you

generate the metrics and KPIs by which you’ll measure

your success.

CENTRALISE, CENTRALISE, CENTRALISE

Commentators stress the importance of the single source

of truth when it comes to customer data and having one

central resource where all data flows converge and can be

accessed is critical to delivering on customer experience.

You can’t afford to have duplicate records, out-of-date

information or extra insights hidden from view.

It needn’t be a question of a wholesale transformation

of systems. Integrating technology, like a customer data

platform (CDP), pulls data from multiple sources, cleans it

and integrates it to create a single customer profile. Other

marketing systems can then access this data, safe in the

knowledge that it’s current and accurate.

Within that centralised framework, you also have to unify

your teams and break down silos. A holistic organisation

is one that has an awareness of the workings and needs

of the rest of the business. This is where you find those

serendipitous moments. The ones where someone points out

that customers are dropping off a loyalty scheme. Basket

size may be going up, but brand love could be declining. The

single customer view must go across a company’s actions, as

well as its data.

FIVE PILLARS FOR OPTIMISING DATA-DRIVEN CX



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3 4AUTOMATE

Artificial intelligence and machine learning shouldn’t strike

fear into the hearts of the less technologically minded. AI is

not taking over.

These two systems work in the background to analyse data,

finding patterns and links that it would take many humans

many, many months to discover. It is these systems that will

help you fill in the gaps in customer behaviour, personalise at

scale and find the insights that will underpin market-leading

customer experience.

INTEGRATE DATA AND CREATIVITY

Data can be seductive for its certainty. But, if you follow data

points too slavishly without incorporating creativity, you can

begin limiting, rather than expanding, your brand’s potential.

Allowing data to point to a range of possibilities helps you to

expand customers’ horizons as well as your own. Using data

to feed creativity builds brand strength, giving customers

experiences that have breadth, depth and emotional

resonance beyond transactional rationality. Data merged

with creativity can help you offer people things they were

not aware they wanted but data-derived insight tells you will

be well-received.

This is a big opportunity that not enough brands make

the most of. It’s time to take data and creativity out

of their respective silos and show them what magic they can

make together.



/ / 1 5

5 TEST, LEARN AND MEASURE

If you set out the parameters of what you wanted to achieve

at the outset, finding the data to evaluate your progress

shouldn’t prove to be a challenge.

Building evaluation mechanisms into your personalisation

strategy will provide even more vital feedback (e.g.

encouraging reviews that feed into Net Promoter Scores

(NPS); affiliate marketing codes to boost sharing and advocacy).

Not every measure of success is financial. Encourage the

wider business to understand the impact of NPS, conversion

rates and customer lifetime value (CLV) as success metrics

that are of equal value to revenue.



/ / 1 6

S E C T I O N F I V E

PRACTICAL ADVICE ON CHOOSING A PARTNER FOR PERSONALISATION

To work effectively with their cl ients, a supplier must be able to:

To make sure a supplier f its their needs, the cl ient should understand:



/ / 1 7

By now, it is clear that data is the lynchpin of the

personalised customer experience. It therefore follows that

any suppliers, whether they are consultancies, marketing

technology (martech) suppliers or platforms, must be able to

offer the right level of support, whatever that may be.

● Unifydataandcreatesinglecustomerviews

• Use data to feed creativity

● Notmanagedatainsilos

● Alignonlineandofflinestrategies

● Developcustomerandmarketinsights

● Understandmacro-customertrends

● Provideinsightforclientsonhowto

activate and implement those insights

● Deliverastrategythatistruetothebrand

● Theirowninternalcapabilities— increasingly,

marketers of every stripe need to have a basic

understanding of how martech works and should

be supported.

● Thedesireddegreeofmanagedservice— technology

often moves far faster than the client organisation

can stay abreast of. How much help should you need

not just today but in the future?

● Sectorexperience— how much the supplier

understands the particular quirks of the sector and

can integrate that into their service proposition.

C O N C L U S I O N

“ I T ’ S T I M E T O T H I N K C R E A T I V E L Y.”



/ / 1 8

It’s clear that consumers are more discerning about where

they share their data, and what they expect companies to do

with it. Trust is paramount.

But trust is just one way you keep hold of customers and

on its own, it’s not enough. To gain that elusive customer

lifetime value, you need to keep providing surprising and

yes, delight your customers afresh.

Businesses have been told repeatedly how vital the data

garnered from various interactions is to maintaining

customer relationships, but all too often the conversation

stops there.

It’s how it’s used that is critical. Personalisation will be

expected in everything from product recommendations

to content, but it has to go beyond funnelling the same

old offers, day in day out.

It’s time to think creatively.

Taking that data and really thinking about the story it

tells. That a customer might like to buy a lot of sneakers

is one story. But are they fitness fanatics or fashionistas is

another? Are they Kanye, or comfort? What is that data

telling you about them that perhaps even they themselves

don’t yet know?

Creativity can and does come from everywhere. From fresh

hires internally to partnering with suppliers who boast the

most exciting minds. Advancing technology has a place —

artificial intelligence and machine learning will increasingly

play their part in discovering new insights and avenues of

opportunity. But don’t forget the value of the human. Their

ability to inject empathy and a vital dose of business realism

is not to be underestimated.

What will the personalised customer experience landscape

look like in five, 10 or even 20 years’ time? Would any one

of us have predicted the ubiquity of the App 20 years ago?

Leave the crystal ball-gazing to the fortune tellers. What will

remain constant is listening to customers and meeting their

needs. All else comes from here.

It certainly drives better customer experiences and as long

as there is a connection between stronger CX delivering

stronger loyalty then it will deliver an output.

That said, all the other ‘hygiene’ factors need to be in play

before personalisation can play the role of loyalty accretion.

So, as an example, you must have the right product,

available, at the right price, with the right delivery or

collection proposition and broader experience/service

proposition to support. if you have all these in play then

personalisation can be the added piece that cements higher

loyalty. However, focus on personalisation at the cost of any

of those hygiene factors and it won’t drive loyalty and could,

create an opportunity cost that erodes loyalty.

In terms of ‘why’ customers draw a thin line between ‘intrusive,

big brother’ style personalisation and personalisation that

just makes life easier for the customer. Curating ranges (i.e.

if my browsing history is menswear and tech, don’t serve

me a homepage with womenswear and soft furnishings) and

knowing who I am and where I am (if relevant) can make

a large brand feel like it is talking to me about the things

that matter most to me. That deeper bond and a sense that

a brand knows what I want before I do can be incredibly

powerful. The opposite is also true. Herein lies the quandary

and the thin line between personalisation being accretive or

dilutive to loyalty.

Naturally a personalised approach to marketing will prevent

activity or communication having such a broad appeal. By its

very definition, the more personalised the content the less

broad appeal it will have.

Knowing my name, age, gender, interests and browsing and

buying behaviour will lead to a more personalised message

to me but if that same content was applied to Sarah, female,

likes reading, netball and keeping fit and lives in Scotland; it

will naturally lead to disengagement.

Therefore, personalisation does limit the ability for content

to have broad appeal.

CASE STUDY…Gary Kibble — Marketing Director Sainsbury’s Argos



/ / 1 9

How does creating personalised experiences drive loyalty?”

Do you believe that a personalised approach comes at the cost of creativity and appeal?”

“ “

To get deeper into the possibilities personalised customer experience has for your organisation contact Victoria Sinclair, Client Engagement Director.

+44 (0) 20 7593 9300

[email protected] cheil.uk

T H A N K

Y O U

mailto:v.sinclair%40cheil.com?subject=I%20want%20to%20get%20personal

https://cheil.uk

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PERFECTING THE ECHO CHAMBER - Cheil UK · customer experience? LOYALTY, DATA AND CUSTOMER CARE TODAY PERFECTING THE ECHO CHAMBER //3. 0% 5% 10% 15% 20% 25% 30% 35% Tailored offers