CS Week Trends - Personalization and Segmentation

If you missed the other entries in this series be sure to catch them here:

Segmentation and Personalization collided a bit at CS Week 47 in Charlotte this year depending on which presentations you attended. Greg McCarthy delivered a powerful presentation and demonstration of taking personalization to a new level for utilities, on par with how customers currently engage with many of their most trusted brands and vendors. Harris Utilities offers a platform to deliver individually personalized videos direct to customer devices or inboxes that are designed to identify and solve customer issues on the spot.

The solution takes common customer issues like high bills, delinquent payments, or energy efficiency opportunities and delivers a personalized video to the customer's inbox that's unique to their situation. Instead of delivering a 1:all or 1:many communication with general input about these topics, utilities leveraging the platform can deliver a video directly to a customer using data for 1:1 personalization.

I could click a link from my email and watch a video on my phone that explains that a bill is overdue by exactly how long and for exactly how much, along with instructions and a helpful link to make a payment. And, this tech could also easily adapt to other utility solutions and customer segments. Imagine launching a high production video encouraging customers with recent Electric Vehicle registrations to enroll in a TOU program where applicable or buy a charger with a rebate on a utility marketplace. The possibilities are limited only by the data and creativity of the utility.

Harris fielded some of those questions during the presentation, showing how utilities could map video content on a personalized level to customer accounts regardless of the underlying system. Most utilities probably haven't experimented with that capability, but mapping data to content has become a very common feature of most engagement solutions today. Imagine being able to identify a common topic or theme important to a subset of customers, building a high-production template to explain the issue, and mapping data easily to deliver engaging and informative video to your customers that GRAB their attention and convey information in that most efficient channel. Lots of excitement from attendees for that workshop.

At a broader level, a few sessions covered Customer Segmentation to optimize outreach and engagement. Based on most of the conversations in those sessions, it's clear that despite overwhelming evidence that Segmentation improves customer engagement and outcomes, utilities continue to struggle to put ineffective 1:All communication in the past. AEP partners with Questline Digital for their business and commercial newsletter programs. Previously to the partnership, AEP sent newsletters to their customers en masse without differentiating by industry. Questline Digital provided a vehicle for organizing content by industry for segments like Healthcare and Manufacturing, which created an immediate and lasting jump in customer engagement by 84%.

AEP made the point clear that their business customers have limited time to process information to find what's relevant to their business, so a 1:All newsletter didn't work. Customers wouldn't or couldn't make the time to sift through topics across multiple industries to find content that fit their needs. By building customer segments on an industry basis, AEP made each newsletter more immediate, topical, and relevant to customer needs. Open rates and click though rates improved dramatically, and customers took action on programs that mattered most to their business.

However, questions from the floor and AEP's own points indicated that the pace of segmentation remained slow for utilities. Despite these incredible stats, utilities seem reluctant to expand segmentation to more groups, and most utilities still depend for the majority of customer outreach on 1:All communication. By contrast, nearly every successful Direct2Consumer business globally leverages customer segmentation to maximize engagement and satisfaction. And that strategy makes sense. Sending a Time of Use plan reminder to customers who recently bought an Electric Vehicle or a Demand Response enrollment link to eligible customers who purchased a smart thermostat shows customers that the utility understands and anticipates their goals and needs. On the other hand, a general EV charger email sent to every customer essentially alienates most customers and teaches them to ignore your future communications because they aren't directly relevant.

Utilities generally expressed two main difficulties regarding segmentation, either a limit on their awareness of how to get data for good segmentation or an inability to get approval to segment customers beyond very basic levels. Utilities still seem to equate segmentation with "targeting," which has a lot of delicate and potentially hazardous implications with their regulators. But, advances in technology, privacy practices, and research amplify the need for and the ease of implementing customer segmentation in a modern utility CX approach. Customers increasingly demand relevant, timely, and personalized communication from the companies they trust and depend upon, and increasingly ignore communication that don't seem to apply to them. Utilities have a long runway to catch up to modern customer outreach, but based on the workshops at CS Week 47, have a lot of tools and expert partners to help them achieve their goals.