The Three Pillars of Hyper-Personalization

The days of one-size-fits-all products and services are behind us. Today’s consumers expect more—notably, products and experiences that feel uniquely tailored to their preferences and needs. In the age of hyper-personalization, it is more important than ever for brands to deliver personalized interactions at every touchpoint.

The importance of the customization demand is highlighted by a recent study by BVA Xsight for IDEMIA Secure Transactions:¹ on average, more than 1 out of 4 consumers in Brazil, France, Japan and the US considers it essential for a brand to customize the products and services it offers, and overall, 82% view this as either ‘essential’ or ‘important.’ Beyond the significance of the trend, this study offers valuable insights into the three key pillars that should guide a brand’s hyper-personalization strategies:

• embracing individuality with offers that cater to consumer preferences,
• capturing attention with well-timed and relevant communications,
• and providing real-time responses to customer needs.

Across all sectors, adopting these strategies can be transformative, especially for essential service providers, where customer expectations for personalization are notably high.

1. Customized offers: Catering to individual needs and preferences

Today’s consumers demand more than just a wide range of options—they want products and services that feel as if they are tailored to them. Think about fashion accessories customized with a personal message or photo, smartphones with customizable colors, themes and widgets, smart heating systems that adapt to your daily routine, cars with customizable interiors, mobile data plans that best suit your travelling habits or a bank app where you can easily set up your own spending limits or notifications—this trend seeps into all sectors. On average, 1 in 2 study respondents declare they are more likely to choose products or use services that help them assert their uniqueness and differences. When making a purchase, consumers tend to prioritize a brand’s effort to provide services tailored to their tastes or profile over factors like innovation, high-end positioning, or social and environmental commitments: 56% of the French, 65% of the Americans, 70% of the Japanese, and 80% of the Brazilians consider this customization effort important. For existing customers, being offered services that align with their preferences and profile is the top priority, according to an average of 64% of respondents. It is also a major driver of brand loyalty.

In certain sectors, such as banking and insurance, the demand for customization is very high. Traditional banks and neobanks are increasingly offering payment cards with unique designs to meet these evolving expectations of modern consumers. One recent example is the limited series of the Feuille d’Émeraude (Emerald Leaf) card launched by the French Fintech Sumeria—a cutting-edge metal card, crafted with a stainless steel and tungsten core, with a distinctive design resembling a thin sheet laser-cut from a gold-veined gemstone.

Fully embracing the importance of creating hyper-personalized experiences, some card issuers allow their clients to choose from a gallery of pre-selected designs, while others let them add a personal touch with a hand-drawn signature or artwork, or by choosing a personal photo to be printed on the background of the card. And in the financial sector, customization possibilities don’t stop at the card look and feel. Within their mobile app, banks and fintech can allow their clients to personalize card settings, set spending limits, enable or disable payment card tokens saved on third party apps or website— blending digital and physical experiences to create unique customer journeys. This level of personalization ensures that each card reflects not only the customer’s aesthetic preferences, but also their financial habits.

2. Personalized and well-timed communication: getting beyond the “name game”

Using a customer’s name in communications is less important than ensuring that messages are timely and relevant. The study highlights that it’s not the superficial personalization of communications that resonates most with consumers, but rather the alignment of those communications with their needs at critical moments. Respondents are more likely to pay attention to how a brand tailors its services to their tastes and profile than they are to see their first and last name in a brand’s communications.

A good example of this approach is beauty retailer Sephora, which uses customer purchase history and browsing behavior to deliver highly relevant, well-timed recommendations. Rather than simply addressing customers by name, Sephora’s mobile app and email communications alert customers to product restocking, seasonal trends, or complementary products based on their past purchases. This approach creates a sense of intimacy and loyalty, ensuring that the customer feels appreciated and understood.

Similar approaches can be applied to other sectors. In the automotive industry, for example, vehicle connectivity, combined with digitalized keys, is paving the way for the car-as-a-service revolution. This marks a first step toward transforming the in-car experience: reshaping how drivers interact with vehicles and strengthening the connection to the car maker brand by offering more personalized, or even hyper-personalized, driving experiences, along with services and recommendations tailored to driver usage.

In addition, the study reveals that personalized communication is most effective when it takes place at key moments in the customer journey, such as when they are comparing options, completing a purchase or subscription, or encountering a problem. Personalization at these stages helps build trust and encourages long-term loyalty. As mobile network operators deploy eSIM technologies, they have a unique opportunity to reshape customer interactions at each of these critical moments by combining UX design, flexibility in selecting subscriptions, and the ability to remotely deploy new features on existing eSIM profiles or resolve interoperability issues.

3. Responsiveness: Meeting expectations in real-time

Modern consumers expect brands to respond instantly, whether they’re seeking product information, making a purchase, or requesting assistance. On average, 77% of survey respondents view the ability to respond quickly as an important or essential factor when buying a product or service—making brand responsiveness the top priority for the vast majority.

To meet this demand for immediacy, brands are leveraging digital technologies to provide real-time services. For instance, many banks and FinTechs propose the instant issuance of a digital card to their clients, so they won’t have to wait for the delivery of their physical card. Another example is Vodafone, rolling out an AI-powered chatbot, SuperTOBi², to provide immediate assistance with issues such as billing, troubleshooting, or plan upgrades to mobile subscribers. By seamlessly transitioning more complex issues to human agents, this virtual agent ensures a balance between automation and personalized support, delivering a high-quality customer experience. Similarly, Airbnb excels at immediacy by providing real-time booking confirmations and immediate support for guests and hosts if an issue arises during a stay.

Balancing personalization with data security and privacy protection

As personalization trends spread across continents and sectors, getting to know customers has never been more crucial. Most consumers are open to sharing details such as age, gender, email or purchase history. However, while they trust brands to securely handle their personal data, the risks of identity theft and misuse of sensitive data remain top concerns.

To maintain trust, brands must be transparent about data usage and prioritize robust security measures such as state-of-the-art encryption and fraud detection. Striking a balance between meaningful personalization and privacy protection is also essential to building loyalty. By embracing the three pillars of hyper-personalization and effectively addressing these security and privacy challenges, brands can truly make a difference in a competitive marketplace.

¹ Market trend analysis and figures based on an online survey conducted by BVA Xsight for IDEMIA Secure Transactions from July 24th to 31st, 2024. Panel of 4,027 people in total composed of 4 representative population samples aged 15 and over in Brazil, France, Japan and the USA.
² https://www.vodafone.com/news/technology/meet-super-tobi-vodafone-s-new-generative-ai-virtual-assistant-now-serving-customers-in-multiple-countries