Personalized experiences: When do they become behaviour change?
Designers are often trying to personalise experiences. However, can too much personalization lead to side effects? Can it lead to behaviour change?
I’m sure you heard this quote before:
“Personal data is the new oil”
Business folks love to say that, but why is it? And what does that mean for the designers and makers out there? Let’s start from the beginning.
Personal data started as a tool for businesses to target consumer groups more precisely. Today, the focus shifted towards using data to personalize interactions with individuals.
Some of the most common interpretations (1) of personalization include:
- Customizing a product or service to fit specific needs or preferences
- Offering special deals based on behaviours
- Creating specific products or services for niche needs
- Adapting advertising and options to preferences and behaviours
It’s been working so well that now people expect it. According to a survey by Epsilon and GBH Insights: “80% of consumers are more likely to do business with a company that offers personalized experiences.” (1)
As individuals, one could argue that it makes sense. We all want to be recognized by others, especially if we’re giving them money. Following that logic, McKinsey's point of view is that“customers want personalization throughout their interactions with a retailer — with multiple, personalized touchpoints that enable them to allocate their time and money according to their preferences.” (2)
That argumentation is taken so seriously that companies like eBay are running experiments in which art and technology are mixed to uncover shoppers’ subconscious desires. (3)
Pushing boundaries
‘The Art of Shopping’, was an event where guests were hooked up to headsets that monitor electrical activity in the brain. People were then set free to visit the art exhibition with the task of paying particular attention to pieces they liked.
In the end, visitors were presented with a personalized report showing which pieces of art triggered the strongest brain activity, and a digital shopping cart containing the items based on their subconscious preferences.
Robb Hattrell, vice president of eBay UK, described the technology as “the future of shopping”.
However, is this much focus on personalization really bringing results for businesses? A lot of people seem to believe so. A report by Vue.ai (4) suggests that product discovery features which tailor to people’s preferences can double the average order value and increase the revenue-per-customer by 60 to 80%.
McKinsey (2) also writes that personalization programs can lift total sales by more than 2% for retailers while reducing marketing & sales costs by 10 to 20%.
The other side of the coin
Unfortunately, not everything that relates to this topic has a positive connotation to it.
The article “The dangers of overpersonalization” by the NN group (11) explains that overpersonalization occurs when a website or app uses too much personal information or presents it in an intrusive or irrelevant way. This can make users feel uncomfortable or violated, causing them to not trust the website or app as much, which can lead to decreased engagement and conversion rates. Additionally, overpersonalization can lead to filter bubbles, where users are only presented with information and options that align with their pre-existing views and preferences.
Shoshana Zuboff, a renowned Professor at Harvard Business School, has been a vocal critic of how companies gather personal information to not only predict behaviours but also influence and modify them.
Her book “The Age of Surveillance Capitalism” describes how tech companies like Google and Facebook “sell certainty to business customers who would like to know with certainty what we do. Targeted adverts, yes, but also businesses want to know whether to sell us a mortgage, or insurance, what to charge us, do we drive safely? They want to know the maximum they can extract from us during an exchange. They want to know how we will behave in order to know how to best intervene in our behaviour.” (5)
This model essentially creates a loop in which you are incentivized to make your predictions become true by directing users towards what the highest probability for business success is. In other words, as described by Zuboff, modifying behaviour becomes the best tool to sell a prediction to business customers. Some signals mentioned by her include Facebook conducting experiments to affect people’s emotions (6) and more famously the Cambridge Analytica scandal in 2018. (7)
The impact of regulations
However, Governments have not been idle since then and the European Union has been enforcing its ‘newly’ minted GDPR regulations. Since the policy took effect in 2018, the EU has imposed about 272 million Euros of fines and as you can see in the graph below, governments are handing out fines more frequently.
Not only that, but over 60 jurisdictions around the world have taken inspiration from the EU and enacted or proposed similar laws on privacy & data protection. (9) These include Argentina, Australia, Brazil, Egypt, India, Indonesia, Japan, Kenya, Mexico, Nigeria, Panama, the U.S., Singapore and Thailand.
New regulations like GDPR will heavily impact how businesses approach personalization. According to a survey by PwC, 44% of CEO respondents rank data privacy among the top 3 policies most impactful to their business. (10)
Going forward
In conclusion, personalization can be a great way to create meaningful connections and experiences, but it’s important to be aware of the potential negative effects and take steps to avoid them. In some forms, this reminds me of when dark patterns were discovered and discussed. All of a sudden every professional team knew what being unethical looked like. Will we see something similar for personalization and personal data? The question is still open.
What we know for sure is that governments started taking an active role, so personal data has become something that businesses need to tread carefully. If you’re someone that creates experiences for a living, then the best advice I can give is to try focus on the benefits of personalization, and mitigate the potential negative effects. Here are some ideas on how to do that:
- Ask for users’ explicit consent before collecting or using their personal information
- Use a more subtle form of personalization, such as recommending content based on users’ past behaviour rather than their explicit preferences
- Be transparent about how personal information is collected and used, and give users the ability to control and manage their personal information.
- Don’t rely too heavily on tagged interests. Create content strategies that purposefully introduce nontargeted content in a thoughtful way.
- Some topics are more sensitive than others. Don’t use a one size fits all approach, rather finetune your algorithms and use a conservative mindset if it’s something sensitive.
Good luck!
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References
1. Epsilon, 2018, New Epsilon research indicates 80% of consumers are more likely to make a purchase when brands offer personalized experiences, link: https://us.epsilon.com/pressroom/new-epsilon-research-indicates-80-of-consumers-are-more-likely-to-make-a-purchase-when-brands-offer-personalized-experiences
2. McKinsey, 2021, Personalizing the customer experience: Driving differentiation in retail, link: https://www.mckinsey.com/industries/retail/our-insights/personalizing-the-customer-experience-driving-differentiation-in-retail
3. Dezeen, 2017, eBay launches “the world’s first subconscious shopping experience”, link: https://www.dezeen.com/2017/10/10/ebay-launches-worlds-first-subconscious-shopping-experience/
4. Vue.ai, 2021, AI-POWERED PERSONALIZATION IN E-COMMERCE: Driving Revenue and Retention For Retailers, link: https://vue.ai/reports/aipoweredpersonalization.html
5. Kavenna J., 2019, The Guardian, “Shoshana Zuboff: Surveillance capitalism is an assault on human autonomy”, link: https://www.theguardian.com/books/2019/oct/04/shoshana-zuboff-surveillance-capitalism-assault-human-automomy-digital-privacy
6. Gibbs S., 2014, The Guardian, “Facebook apologises for psychological experiments on users”, link: https://www.theguardian.com/technology/2014/jul/02/facebook-apologises-psychological-experiments-on-users
7. Cadwalladr C. & Graham-Harrison E., 2018, “Revealed: 50 million Facebook profiles harvested for Cambridge Analytica in major data breach”, link: https://www.theguardian.com/news/2018/mar/17/cambridge-analytica-facebook-influence-us-election
8. Enforcement Tracker, 2021, link: https://www.enforcementtracker.com/?insights
9. Moore S., 2020, Gartner, “Gartner Predicts for the Future of Privacy 2020”, link: https://www.gartner.com/smarterwithgartner/gartner-predicts-for-the-future-of-privacy-2020/
10. PwC, 2020, “Top policy trends 2020: data privacy”, link: https://www.pwc.com/us/en/services/consulting/risk-regulatory/library/top-policy-trends/data-privacy.html
11. NN Group, 2019, “The Dangers of Overpersonalization”, link: https://www.nngroup.com/articles/overpersonalization/
