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Artificial Intelligence technology is now considered one of the strongest assistants and brand differentiation weapons that can work alongside humans. With its huge impact on a wide variety of industries, it is being used to shape innovative business strategies and beat competitors.
As Ginni Rometty, IBM’s former CEO, once said, “Some people call this artificial intelligence, but the reality is that this technology will enhance us. So instead of artificial intelligence, I think we’ll augment our intelligence.”
Across various industries, AI can improve efficiency, reduce costs, enhance accuracy, and provide personalized experiences to customers.
Now brands are adapting to AI and using it innovatively to satisfy customers’ needs.
The Transformative Trend
People nowadays expect personalization and so brands are trying to be receptive by using AI technology to celebrate individuality.
Brands can now tailor products, services, and experiences to individual users based on their specific needs, characteristics, and preferences using hyper-personalization enabled by AI.
But how exactly is artificial intelligence (AI) able to enable hyper-personalization efficiently?
Let’s ask the AI.
What CHATGPT has to say about the role of AI in Hyper-Personalization?
By its ability to collect and analyze vast amounts of user data from various sources, such as browsing history, social media interactions, purchase patterns, and demographic information, AI systems can:
- Identify user behavior patterns and trends that allow it to predict user preferences, interests, and behaviors, enabling personalized recommendations and experiences to influence user behavior positively.
- Understand the textual data, such as customer reviews, feedback, or social media posts, and personalize interactions and responses accordingly using its Natural Language Processing (NLP) techniques.
- Offer tailored recommendations for products or services based on an individual’s past behaviors, preferences, and similarities to other users with similar profiles and provide relevant information, enhancing the customer experience.
Overall, this results in a highly personalized user experience. Organizations can deliver highly customized experiences, products, and services to individual users, enhancing customer satisfaction and engagement.
How are Brands applying Hyper-personalization?
Based on some studies, most organizations that use AI personalization to improve the customer experience enjoy 5-8 X the return on their marketing spend.
Using customers’ and prospects’ insights, brands can make relevant product recommendations and innovations in real time.
Let’s check out some industry-specialized applications.
Hyper-personalization For E-commerce
A famous example of a hyper-personalization application is the product recommendations “Customers also bought” or “Customers also viewed” section in e-commerce websites which not only boosts customer engagement but also boosts conversion rates as it encourages shoppers to add more items to their cart.
But the role of hyper-personalization does not stop at getting customers to fill their carts, but also at reducing the abandoned carts. Platforms like Amazon, use its ML-based recommendation system, “Amazon Personalize” to recommend products to users based on their preferences.
Hyper-personalization in the Food Industry
Food has become fast, and now it needs to become more personal. Since customers are constantly looking for more personalized experiences, food companies and food apps are also now using technology to adapt and make the customer’s journey more appealing.
Mealmind, an AI-powered meal-planning service, uses AI to analyze each person’s goals, dietary needs, and preferences to create personalized meal plans with detailed recipes.
Another example is Tekeya, the first food-conscious app in the Middle East that connects Hotels, Restaurants, and Groceries with fresh surplus food to consumers to help prevent unnecessary food loss.
They use AI auto-detection features to show you the best shops nearby where you can get a fresh meal at a reduced price.
Food apps like Talabat tailor personalized promotional deals and targeted offers that are more likely to resonate with individual users based on their ordering patterns and preferences.
Gourmet Egypt, the high-end food retailer uses Algonomy, the personalization solutions provider with self-driving AI, to provide a hyper-personalized shopping experience to its customers.
They offer personalized engagement across various touch points to deliver relevant recommendations and tailored offers based on customer preferences and behavior which in turn leads to increased customer visit frequency, engagement, and conversion rates.
Other smart ideas could still emerge in the future to offer more personalized experiences.
Hyper-personalization in the Automotive Industry
Realizing that even the automotive industry must adapt, Mercedes-Benz has been utilizing hyper-personalization to enhance the user experience by integrating AI into the voice control of its vehicles. With advanced sensors and intelligent voice control, such as “Mercedes Me” or “Hey Mercedes,” Mercedes-Benz vehicles can learn the driver’s preferences for seat position, temperature settings, preferred music, and navigation routes to provide a personalized driving experience.
Hyper-personalization in the Beauty Industry
A recent study highlights that 72% of consumers express a willingness to pay more for personalized cosmetic products.
L’Oréal brand combined artificial intelligence (AI) with augmented reality (AR) to offer a complete personalized beauty experience to its customers. By acquiring, ModiFace, the Makeup Virtual Try-On, it was able to satisfy hybrid workers, giving them the option to attend video meetings via Microsoft Teams while choosing from a wide selection of video effects and makeup looks.
Another perfect example from the same brand is Perso, the 3-in-1 technology at-home personalized beauty device that incorporates real-time skin assessment to create custom on-demand formulas for skincare, lipstick, and foundation.
SkinGPT is another revolutionary AI-powered skincare app, that offers hyper-personalized skin care and beauty experiences!
It’s able to analyze each individual’s skin condition through a simple selfie in seconds to recommend the best products tailored to personal needs.
It also educates consumers about the products and what they can expect from using each product.
Hyper-Personalization in the Entertainment Industry
Netflix is one of the companies that leverages deep learning just like Amazon, and uses customer viewing data, search history, and rating data to predict what should be recommended to viewers.
What to Expect from Hyper-Personalization?
If you are looking to grow, adopting a hyper-personalized strategy is now essential; not only to attract first-time buyers, but to increase the lifetime value of your existing customers.
Simply it will help you understand customers’ needs and preferences, allowing you to optimize your operations and marketing efforts to deliver enhanced customer experiences. This will also help decrease customer complaints and increase customer loyalty and retention.
Conclusion
In conclusion, AI technology uses data to learn patterns, make predictions, and process data and can help brands develop a more creative approach to business and marketing and differentiate themselves to stand out in the crowded market by creating interactive experiences.
Going beyond the one-size-fits-all approach, brands are now beginning to alter the way they engage with consumers by leveraging AI technology in innovative ways. Approximately 80% of customers are more loyal to brands that offer personalized products and experiences.
When customers feel valued and understood, they are more willing to buy.
As AI technology is expected to get smarter, we can expect even more innovative forms of personalization shortly.
