Driven by the fear of missing out, businesses are becoming more enthusiastic about personalization. At the same time, you might have heard of omnichannel personalization and be wondering what it really is, and whether it's worth the investment.
What is omnichannel personalization
Omnichannel personalization delivers a seamless, personalized customer experience across all touchpoints, whether online or offline.
Consider the consumer shopping experience today, which is rarely confined to a single channel but instead spans a diverse mix of dazzling digital and physical offerings. Brands that succeed in delivering a continuous experience, minimizing the frustration of starting from scratch every time a customer connects with them on a new channel, will ultimately win customers over due to the convenience.
That said, if you're mapping out the customer journey across online and offline channels, offering personalization on only one or a few channels won’t suffice, and can even backfire. This is where omnichannel personalization becomes crucial. Report shows that companies able to personalize the customer experience across both physical and digital channels can achieve a 5 to 15 percent revenue increase across their entire customer base.
Laying the right foundation
It’s often considered omnichannel success when customers make purchases thanks to a well-executed strategy. However, for brands looking to build lasting relationships and make their omnichannel efforts both sustainable and more effective, it’s essential to elevate to the next stage: omnichannel personalization.
As McKinsey notes, the key to success lies in your ambition. It’s not just about offering an omnichannel experience; it's about tailoring the experience at every step and making it truly personalized. But many retailers, eager to leap ahead, attempt to move straight to more advanced stages of omnichannel without first laying down the foundational capabilities. This misstep is why many fail in their efforts.
Let’s take a moment to revisit McKinsey’s framework for building a successful omnichannel personalization foundation:
- Data and analytics: This is the backbone of personalization. Integrated cross-channel data, effective content management, and decision-making automation are all crucial for providing the insights that power personalized experiences at scale.
- Stores and supply chain: A seamless integration between inventory and delivery, including digital fulfillment through physical stores, ensures that products are available whenever and wherever your customers need them.
- Site and mobile: Flexible, scalable site and app infrastructure is key. This includes having the ability to conduct A/B testing, deliver dynamic content, and adjust content versions on the fly. This adaptability helps you meet customers' expectations across channels and in real-time.
- People and processes: Success depends on cross-functional teams that have access to shared data and integrated KPIs. A unified view across channels ensures that everyone from marketing to supply chain management is aligned in delivering the same, seamless experience.
McKinsey also highlights an important point: “While most retailers personalize engagement and outreach to some degree, those that pursue omnichannel personalization go far beyond rudimentary retargeting and lookalike segmentation. They shape consistently tailored interactions across channels, and they do so continuously and at scale.”
The importance of content management in this foundational framework cannot be overstated. Effective content management not only helps in maintaining consistency across channels but also enables the creation of dynamic, tailored content that resonates with different customer segments. Without a strong content management system (CMS) to handle this complexity, personalization at scale becomes nearly impossible.
By establishing these foundational capabilities, businesses set themselves up for sustainable success in omnichannel personalization, ensuring their efforts are not only effective in the short term but also scalable and long-lasting.
Benefits of omnichannel personalization
Omnichannel personalization has proven to offer significant, concrete benefits for both businesses and customers. Companies that invest in these capabilities – unifying customer data and delivering tailored interactions at every touchpoint – are seeing significant payoffs in the form of happier customers and stronger business performance.
Revenue growth and sales uplift
Companies with strong personalization strategies see significantly higher sales. Fast-growing firms drive ~40% more of their revenue from personalization than their slower competitors. Companies that get personalization right see higher growth, conversion, and ROI – often 10–15% or more in revenue lift on average according to industry research.
Improved customer retention and lifetime value
Personalization fosters stronger loyalty by making customers feel recognized and valued. 78% of shoppers report that relevant, personalized content makes them more likely to repurchase from that brand in the future. As a result, omnichannel shoppers are more valuable, given that they spend about 30% more and have a 30% higher lifetime value than single-channel shoppers on average.
How successful loyalty programs harness omnichannel personalization
Starbucks uses its app-based rewards system to tailor offers based on each customer’s purchase history (favorite drinks, past orders, etc.). This strategy has built an extremely loyal customer base. As of 2024, Starbucks’s loyalty members drive 57% of all U.S. sales, and in late 2023, members were spending 3× more per visit (and visiting more often) than non-members. This underscores how personalized, cross-channel engagement translates into concrete loyalty and higher customer lifetime value.
Stronger engagement and personal connection
Tailored omnichannel outreach leads to deeper customer engagement. Shoppers who receive relevant, synchronized messages across channels are far more likely to stick with the brand, as 88% of people are more likely to return to businesses that deliver a cohesive, personalized omnichannel experience. We see this in customer interactions: with personalization, customers open and interact with brand communications at much higher rates.
Getting started with omnichannel personalization
Omnichannel personalization isn't just about integrating data across channels. It's about aligning those efforts into a seamless, tailored customer journey. Before diving into this advanced strategy, it’s important to first understand the key foundational components that set the stage for success. Here’s how to get started:
Understand your data landscape
Successful omnichannel personalization relies on integrated cross-channel data. Ensure your systems can collect and analyze data from various customer touchpoints: online, offline, and even through customer interactions like loyalty programs or service appointments. This data forms the backbone of personalized customer journeys.
Adopt a centralized CMS
Content plays a pivotal role in omnichannel personalization. A centralized CMS ensures that you’re not only managing content effectively but also delivering consistent messaging across all channels. It's crucial for creating reusable content that can be tailored for specific touchpoints without losing consistency in voice or brand messaging. Reusing content in this way helps streamline the personalization process and maintain efficiency as you scale.
Create a flexible infrastructure
Flexibility is key to delivering dynamic, personalized content. Your website, mobile app, and other digital platforms must have the infrastructure to support A/B testing, versioning, and real-time content updates. This flexibility ensures that you can adjust content as you learn more about your audience and their needs.
Integrate with your supply chain and stores
Omnichannel personalization goes beyond the digital. To ensure seamless experiences, integrate your inventory and delivery systems across both physical and digital channels. This way, whether a customer shops online or in-store, their journey remains consistent and frictionless.
Cross-functional collaboration is key
Personalization isn’t just the job of marketing. Successful omnichannel strategies require cross-functional teams: marketing, sales, customer service, and even product development working together. It’s essential to use tools that enable easy collaboration between these teams, allowing them to share data, insights, and KPIs for a unified approach to delivering the best customer experience at every touchpoint.
Additionally, it's crucial to implement a separation of content within your workflow, so one team focuses on creating the base content, while another team can tailor it for specific channels or markets. The separation ensures content is optimized and relevant to the needs of each audience, while still maintaining a centralized source of truth.
Leverage zero-party data for personalization
Zero-party data is the data collected directly from customers. It allows for personalized experiences without relying on third-party sources. Once you’ve built a system to track interactions across your touchpoints, you can start delivering content that’s relevant to the individual, based on their own actions and preferences.
Start with simple personalization, then scale
Begin by personalizing your customer journeys at a smaller scale. This could be as simple as personalizing emails or product recommendations based on previous purchases. As you gain more insights and resources, you can gradually scale your efforts to encompass more channels and touchpoints.
Focus on consistency across channels
Omnichannel success is more than being present on multiple channels. You need to ensure a consistent experience. Personalization should feel seamless across all touchpoints, from the website to mobile apps to physical stores. Inconsistencies in messaging or service can disrupt the customer journey and hurt brand loyalty.
Embrace automation and AI
As you scale, automation and AI will become indispensable tools. Use AI to personalize at scale, whether it’s generating personalized content on the fly or automating product recommendations based on past behaviors. These tools help ensure that personalization is continuous, efficient, and effective at scale.
Measure and optimize
Personalization is an ongoing process. Continuously track and measure your personalization efforts. Use data to understand what’s working and what isn’t, and optimize your strategies accordingly to ensure that your efforts remain aligned with customer needs and expectations.