Executive Thought Leadership

Personalization: Transforming the Way Business Connects

Personalization goes beyond customization, allowing the consumer to stamp a product or service with his or her own applications, preferences, and configurations. Technology is particularly adept at enabling a high degree of personalization, as in the case of the downloadable applications available on mobile phones or personal digital assistants (PDAs). By offering a large variety of possible products, features, and services, personalization has the power to increase sales and margins enough to transform business models.

To better understand if and how personalization of products and services is a part of business plans and priorities, the Economist Intelligence Unit (EIU), in association with Cisco, conducted an Internet survey of more than 328 executives from diverse industries and job functions around the world. The study also sought to understand the business expectations of a personalization strategy and how to overcome common challenges faced in this endeavor.

Top-level results regarding why personalization is important to these executives and their businesses include:

• Personalization increases customer satisfaction and loyalty.
• It has a strong positive impact on revenue growth: 80 percent of executives predicted an impact in five years.
• Customers will pay extra for interactive experience, which increases profit margins.
• Personalization bonds consumers and producers of products and services.

For more information on personalization and how it can evolve your business, please refer to the full report from the EIU, Transforming the Way Business Connects (PDF).

The study is one of three published in 2007 as part of a research program that arose from the EIU's March 2006 "Foresight 2020" report sponsored by Cisco. This report highlighted a number of important changes to the world economy over the next 15 years. The principal trends the report identified—globalization, demographics, atomization, personalization, and knowledge management—will have a profound effect on the landscape of major industries and the inner workings of companies worldwide.

Three themes were developed into separate research projects: in addition to personalization, innovation and collaboration were studied. The results of each study are intended to stand independently and to fit together, describing from different vantage points the development of the interactions economy, in which customers, suppliers, workers, owners, and others go beyond mere transactions to exchange information for mutual benefit.