Marketers can't demonstrate ROI

“I want to be clear, it is not that we don’t think personalisation can work,” says Bloom. It’s simply that Gartner believes “there is a risk that marketing teams have overestimated their ability to tie [desired] outcomes to their investments.”

If marketers can’t prove return on investment, and privacy regulation is pushing up costs for marketers to continue with personalisation, they are less likely to bat for it in the boardroom, Bloom suggests. Beyond e-commerce, he says, it is “extremely tricky” to deliver a return on investment equation back into the business.

Gartner’s definition “too narrow”

Gartner’s report suggests marketers are allocating 14 per cent of budget to personalisation, which WPP’s Adam Good and Roger Slater suggested was far too low.

Slater says that likely means Gartner has been too narrow in its definitions. Personalisation, he says, goes far beyond marketing. That means the metrics of success, or how ROI is gauged, should also transcend the marketing department (and therefore its budget).

Sarah Adam-Gedge, managing director, Publicis Sapient seconds that view. “We certainly view personalisation as being more across the enterprise,” she says. “I think very much we're seeing the CMO, the CIO, the chief digital officer and [managers] more broadly into the business, all coming together on what their metrics are, how they're cascaded down into the organisation, and then how you measure against that.”

While provocative, Adam-Gedge therefore believes Gartner’s prediction about the demise of personalisation is well wide of the mark. She bangs the drum for customer data platforms, or CDPs, as the next step toward enabling personalisation at scale.

“We're seeing the rise in Australia of customer data platforms, which is an evolution,” suggests Adam-Gedge. “And so, while I really enjoyed reading the Gartner study, certainly I felt that it was more narrow in terms of understanding this topic.”

Proof of concept: Try before you buy

Bloom, however, suggests personalisation as something that transcends marketing is wishful thinking.

“The ambition is certainly there; the clients we speak to would love to have that cross-silo influence. But I think the reality is it is just not that simple. It is really hard to be able to get buy-in from a single executive stakeholder. But you're talking about the entire organisation moving in unison. And the challenge is that adopting the technology then becomes an exercise in change management,” says Bloom.

“And I think a lot of buyers are ill equipped to do that all by themselves. That often means you have to admit that something wasn't working in the past. You have to admit that it was your fault. You might have to work with teams that you have competed with for resources in the past.”

Even where marketing and IT departments enjoy cordial relations, he says, it’s no “slam dunk”, especially as marketers tend to be “finicky”.

“They like their pretty interfaces. They want to be able to do things independently, even when someone in data governance might say, ‘please don’t do that!’,” says Bloom.

Meanwhile, he says CDPs are no silver bullet.

“The CDP trend is something that we look at quite a bit as one that tries to introduce some flexibility into the domain of the marketer.

“And I think it is often looked at as the solution when perhaps, some of these more transformation focused initiatives are things that really are designed to promote cooperation around a proof of concept, which I think is an under-utilised way of deploying technology.

“That's the kind of thing that we'd like to see more of. Recently, we did a survey and only 34 percent of respondents said they used a proof of concept as one of the ways that they evaluated the marketing technology that they selected. And that's certainly a sign that we're going to be looking assess more in these Covid times, where resources in particular are going to be constrained,” he says.

“You really want to make sure that you're assessing technology not against a 200 row Excel spreadsheet of functionality, but against that capability that you're going to build around the technology.”

Citi: Increasing spend on personalisation

Citi’s Slater agrees more proof of concept work is required – and that marketers can no longer be “lazy”, reliant on technology, cookies and a plethora of channels to just “push content out, start managing the interaction and call that ‘experience and engagement’.

“We have to move beyond looking at technology to solve our problems,” he concurs with Bloom.

However, he says Citi “is actually going to invest more money in personalisation” rather than less. “But I want to add relevancy and I want to add context to that. So it is not just personalisation on its own any more,” says Slater.

“So we’re going to increase it. The investment in AI is increasing, the investment in CDPs is increasing - and these segmentations of technology and market to enable us to do a better job of being relevant is where we're investing our money.

Semantics: time to rebrand personalisation?

Brand Traction principal, Jon Bradshaw, thinks Slater has a point. “If we didn’t call this stuff ‘personalisation’, but called it relevance and context, it would get deployed in a very different way,” he says.

Publicis Sapient’s Sarah Adam-Gedge agrees the issue may be semantics.

“Maybe the word ‘personalisation’ is passé. Perhaps it's had its day. It's kind of like how we used to talk a lot about e-business and a lot about cloud,” she suggests. Ultimately, “all this is really around customer experience.”

Adam-Gedge agrees that if CX makes the customer king, then the technology marketers are deploying has to come second to defining that customer need. Otherwise, she says, “it’s the tail wagging the dog.”

Shiny toys and snake oil refills?

Bloom agrees. Marketing got itself into this mess largely by failing to consider need before tech. Marketers were blinded by easy returns that failed to materialise, and now find themselves either having to buy more technology – or admitting they have been sold an expensive lie.

But he sympathises with that plight.

“If somebody said, ‘I have this machine over here and you put in a dollar and you get back a dollar fifty,’ you would have a hard time criticising [the person who fell for it],” says Bloom.

“In that 2013, 2014 era where you started to see a lot of these attribution solutions become more popular and become more of the justification themselves into how you're going to use some of these digital advertising capabilities at increasingly high levels of scale... I think it's, maybe not laziness, but it certainly is an almost irresistible bet to make.”

The problem, he says, is that those solutions are not focused on customer needs – and hence have underperformed.

“It doesn’t talk about why they want something, and that is where we certainly see opportunity for brands to more effectively understand why personalisation or relevance or the right kind of context is going to be needed,” says Bloom, “before they start building some technology solution.”

Otherwise, he says there is a risk that marketers pile into the next tech iteration, i.e. CDPs, and get burnt again.

The enterprise software companies touting CDP solutions, suggest Bloom, “are basically saying, ‘Remember that problem that we created? Well now we have this other thing that solves that problem. Isn’t that great?’”

As such, he is not sure whether the noise around CDPs will translate to more platform sales, or that CIOs, CMOs and CEOs are fully persuaded on their merits.

For those that are, “I think it definitely bears scrutiny in terms of making sure that those solutions really do deliver what what's expected,” says Bloom. “Especially as it relates to your integration between marketing or the enterprise's existing data assets and the technology that's actually doing some of the heavy lifting.”

Too late to turn back?

Brand Traction’s Jon Bradshaw thinks the reason people are persisting with underperforming martech is because it is potentially “career ending” to admit they have wasted millions. Far easier, he says, to spend another half a million bucks to try and make it work.

For that reason, he thinks Gartner’s prediction of the demise of personalisation may not come to pass. But otherwise, he is largely in agreement with Bloom.

“If it all died tomorrow, I’m not entirely sure the reduction in marketing effectiveness would be anything like as beneficial as the reduction in marketing spend,” says Bradshaw. “Because I think the effectiveness increase is small and the spend is significant.”

‘Tailored help’ the new personalisation?

Gartner’s Bloom thinks ‘tailored help’ is perhaps a more relevant pursuit than personalisation for brands.

That is, “How does this thing that I am trying to do, regardless of what you call it, actually help a customer at some particular moment in the customer journey where you can understand what is standing in the way of that customer? That's the kind of lens that we'd like to see more enterprises put on it,” says Bloom.

“So if we can develop the right kinds of things, whether we call them personalisation or not, with that wider scope and more customer-focused lens, I think those are the kinds of initiatives that we see with the potential to succeed.”

Citi’s Slater “loves that” approach. “I think that's a really nice place for Gartner to start forcing us as businesses to pay attention to actually what's going on in the marketplace,” he suggests.

Publicis Sapient’s Adam-Gedge agrees ‘tailored help’ is “spot on”.

So while personalisation may be facing headwinds, it appears 'tailored help' is waiting in the wings to refocus the customer agenda across the organisation and culture. Tech is not the silver bullet.