Personalisation maturity: How retailers across regions and sub-industries are stacking up

In today’s digital-first world, customers expect experiences to feel as if they were tailor-made just for them. To live up to these expectations, brands are working to enhance their personalisation efforts and to deliver experiences that catch customers’ attention and gain loyalty. But creating seamless shopping experiences isn’t as simple as it sounds.

Adobe partnered with Incisiv to conduct an in-depth report to see how retailers stack up against one another when it comes to personalisation within the industry. The report, Looking Closer at Retail Personalisation: A Report on Region and Sub-Industry, shows that although retail’s personalisation maturity is ahead of other industries, it lags when it comes to customer expectations. In fact, more than half of all retailers fall short of creating journeys that meet customer needs — and only 44% personalise more than half of the shopper journey.

Retailer metrics differ by region

The path to personalisation maturity is an exciting prospect for retailers across the globe. And while some regions are well on their way to delivering unique customer journeys, other regions still have room for growth. For example, 52% of retailers in North America and 49% of retailers in Europe personalise more than half of the shopper journey. But in APAC, just 23% of retailers are meeting that goal. Still, while the adoption and maturity level in APAC is low, it’s important to note that it’s been rising at a faster rate than in North American and European markets, and APAC has made great strides with personalisation on mobile devices. (China, which has more advanced personalisation technology and experiences, was not included in this survey data.)

52% of North American retailers and 49% of European retailers personalize more than half of the shopper journey, compared to just 23% of retailers in APAC.

Four factors for personalisation maturity

What allows regions to succeed in delivering highly individualised customer journeys? The research focused on four main personalisation maturity factors:

Personalisation maturity varies widely across sub-industries

In addition to looking at how retailers across regions were doing when it comes to personalisation, the research also looked at how various sub-industries compare to one another. Results showed some interesting sub-industry differences across grocery, apparel, specialty, and general merchandise.

Only 11% of grocery retailers personalise more than half of their shopper journey, while 74% of all general merchandise retailers and 71% of specialty retailers do. Apparel comes in at 44%, which is closer to the overall industry average. These differences exist because brands that invested significantly in digital commerce have seen better overall business outcomes. While grocers rapidly upgraded their digital capabilities over the last 18 months, their focus has been primarily on digital commerce and the supply chain rather than on personalisation. It’s understandable why they had to turn a quick focus to those two areas — the COVID-19 pandemic turned everything upside down — but now grocery retailers would be wise to shift their focus toward enhancing their personalisation efforts to ensure they’re meeting and exceeding customer expectations.

74% of general merchandise retailers personalize more than half of the shopper journey, while only 11% of grocery retailers do the same.

Challenge areas also range across sub-industries

When asked about their top challenges around personalisation, retailers across sub-industries pointed to different areas. Diving into these differences provides further insight into how some retailers are enhancing their Personalisation experience while others are struggling to get personalisation efforts off the ground.

Before the pandemic, shoppers mostly interacted with grocery retailers in-store. But when customers could no longer safely shop in person, grocers scrambled to build digital channels like online ordering and delivery or contactless pick-up options. But even now, these businesses are still playing catch-up. And they are going through similar growing pains that other sub-industries faced when they first made the shift to digital, like struggling with an inability to develop a business case for personalisation and limited in-house resources to support it.

General merchandise retailers, on the other hand, are past the foundational phase of digital commerce and are focused on more efficiently scaling Personalised experiences. Their top challenges — inabilities to scale personalisation efforts across channels and to act quickly on personalisation recommendations — reflect the maturity they’ve already built. These retailers now need to focus on creating a unified customer journey that can anticipate customer needs and act on those needs in real time.

Personalisation efforts must be top-down

Having the right people and processes in place can make all the difference when it comes to personalisation. For instance, grocery retailers report that they’re struggling to find the right talent for basic personalisation efforts and that they often don’t have the resources to create a centre of excellence or train specialised subject matter experts. Retailers that are struggling to enhance their personalisation efforts often find that their teams are siloed and that they don’t have a unified effort across the whole organisation.

Retailers who are further along on the path to personalisation maturity have taken the opposite approach. Establishing centres of excellence and specialists that work across departments is essential for firms to scale their efforts across multiple commerce and engagement channels. It’s also important for leadership to make it known to teams working across the organisation that enhancing personalisation efforts will be a brand-wide initiative.

Be a personalisation leader

Brands that have looked at the shift to digital as an opportunity to really double down on their personalisation efforts have seen success. That number, for now, is low — just 16% of retailers qualify as leaders in personalisation maturity by personalising 75% or more of the shopper journey. But of those leading retailers, 90% have a defined personalisation strategy and roadmap, 100% have a single executive responsible for personalisation, and 81% have a unified view of their overall personalisation strategy. “Personalisation” isn’t just a buzzword anymore — it’s a crucial component to a brand’s long-term success.

Personalisation maturity is a journey. But working to enhance your personalisation efforts can have exponential impact at any stage. Moving up the maturity curve requires a sharp focus on these three pillars:

Ready to bring your organisation’s personalisation maturity strategy to the next level and create personalised experiences that stand out? We can help.