AI & Analytics

100+ Top marketing execs say AI-driven personalization is the new norm

By Gopi Vikranth, and Arianna Tousi

June 28, 2021 | Article | 7-minute read

100+ Top marketing execs say AI-driven personalization is the new norm

Personalized marketing is the new normal. However, most organizations are behind in delivering personalized engagement. As demand for digital consumption grows, this is not the time for organizations to crawl, walk or run toward it. It is time for them to leapfrog.


There are two paths to personalized engagement. One deploys customer-level, personalized interventions in optimal segments to quickly and consistently provide value. The other could take at least two years to demonstrate value, leaving leaders frustrated and organizations stuck.


ZS recently surveyed over 125 marketing executives1 to better understand their personalization efforts and barriers. Here is what we found:

Personalization pays off

75% of respondents said their personalization efforts yielded at least 10-20% of their incremental revenue or customer growth. Personalization efforts have paid off and drive real business value. 

But more need to implement it

More than two thirds of respondents recognize personalization’s importance, however, fewer than one third of respondents offer individualized precision engagement at scale. This shows that companies are seeing real outcomes but very few currently deliver 1:1 personalization at scale. 

D2C companies need personalization most

The importance of personalization drastically changes depending on the business model. Businesses that focus on direct sales channels, such as websites, apps, and other digital approaches, are 50% more likely to invest in personalization efforts than are other companies. Direct-to-consumer retailers have more skin in the game and will soon become irrelevant if they do not catch up. 

Respondents are rapidly adopting AI

90% of survey respondents plan to increase their individualized personalization efforts to drive 1:1 engagement in the next 12 to 24 months. Two thirds of respondents will deploy AI solutions to achieve this vision. 

“Artificial Intelligence will be a primary driver of unlocking scale of personalization efforts: It’s flexible, continuously learns and can quickly adapt to new business needs.”

E-Commerce is ahead of the game

E-commerce companies can offer a few pointers. More than half of these organizations have deployed or are currently employing an AI solution, compared to less than one third of traditional retailers. E-commerce companies have invested more in their digital engagement models and enabled this investment through AI. Many traditional retailers have had to play catch up, especially during COVID. 

Everyone is talking about AI, few successfully deploy it

Even with all the hype, few organizations have successfully implemented AI solutions for personalization. Only 16% of companies surveyed have deployed AI for one or more years.


That’s because these organizations are waiting for data, which they need for AI personalization efforts. They are heavily reliant on this data to implement their marketing technology and are playing catch up.


In order to overcome these barriers, we believe companies need to conquer some common setbacks.

Don’t let a lack of data hold your company hostage

Half of the leaders surveyed cited a lack of data or low data quality as a primary driver for not investing more in personalization opportunities.

Many firms, since they don’t have great data, are stuck with the cold start dilemma.


Cold starts happen when organizations do not have enough historical consumer data, limiting their abilities to recommend the right solution for a given customer profile. Several companies have addressed this through using simple business rules, incorporating human-in-the-loop systems, crowdsourcing information or partnering with third-party data vendors.


DoorDash conquered a cold start when it recommended food groups based on users’ entries in its app. Initially, it had to incorporate a human-in-the-loop model to create a food taxonomy and to label food items to match specific user preferences. This allowed DoorDash to collect more label data on consumer preferences and match that data with available food characteristics. Over time, this improved DoorDash’s customer recommendations.


Perfect data is a utopian concept. Leaders should experiment to find ways to generate consumer behavior data, and then execute personalization efforts. They can improve their customer data with time.

Make the most of the tools you have

Our surveyed leaders were most commonly challenged by a lack of integrated tools, such as customer relationship management tools and mobile technology, among others, which they needed to implement personalized experiences. Marketing technology will continue to evolve and executives must charge ahead with delivering customer experiences.


Leaders can still leverage AI to execute personalization and 1:1 customer engagement in parallel with their marketing technology investments. Artificial Intelligence solutions can stand to be more accessible to end-consumers. They could also be more interoperable with other marketing technologies. Leaders can resolve this issue by ensuring their initial AI investments are platform agnostic.


Digital consumer behavior is accelerating, and firms need to adopt personalization right away. If they don’t, they risk losing consumers to digitally native brands that are capturing customer interest and loyalty. Organizations must leapfrog to personalization, and AI will be the catalyst to help them do it. 


(1) Respondents were vice president level or more senior.

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