The days when personalization meant seeing your name in an email are well behind us. Today, AI-driven personalization orchestrates nearly every facet of the retail experience from dynamic pricing and individualized recommendations to conversational guidance and tailored in-store interactions.
According to McKinsey, personalization can significantly boost revenue: companies that lead in this area generate 40% more revenue from their efforts compared to average players, and moving into the top quartile of personalization performance could unlock more than $1 trillion in value across U.S. industries.
Consumers demand relevance, and when they don’t get it, brands pay the price. McKinsey reported that 71% of people expect personalized interactions, and 76% become frustrated when they don’t receive them.
Moreover, personalized experiences extend far beyond simple product suggestions. A McKinsey study illustrates that effective personalization across both digital and physical channels can yield:
- A 10 to 15% lift in conversion rates
- A 20 to 30% boost in marketing ROI
- Even greater performance gains in highly personalized interactions
The key to success isn’t just better data – it's building an operating model that is both respectful and intuitive. This means cross-functional teams that integrate marketing, tech and product; real-time decisioning engines; agile workflows; and transparency around how and when personalization happens.
Done properly, personalization doesn’t just feel personalized, but it feels natural and valued.
