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This Time It’s Personal: Making Online Experiences Unique

August 2007

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This Time It’s Personal: Making Online Experiences Unique Page 2

© 2007 Aberdeen Group. Telephone: 617 723 7890 www.aberdeen.com Fax: 617 723 7897

Executive Summary The process of personalizing the online experience can be achieved through multiple technologies that can be used to generate revenue and build customer loyalty. Eighty-eight percent of Best-in-Class companies agree that they will recognize a Return on Investment (ROI) from the personalization technologies they have adopted. Further, 76% percent agree, that the economic gains from personalization technologies will outweigh the costs of implementation.

Best-in-Class Performance Aberdeen used three key performance criteria to distinguish Best-in-Class companies from Industry Average and Laggard organizations. The improvements gained by the Best-in-Class exceeded their peers and are reflected in the following metrics:

• 91% demonstrated improvement in online conversion rates

• 79% increased average order value as a result of personalization

• 62% improved revenue per visit from personalization efforts

Competitive Maturity Assessment The essential ingredients of a well-designed personalization strategy include both segmentation and unique user profile development. Best-in-Class companies deploy personalization tactics across multiple areas of their communications and web properties including: email (76%), cross-sell / up-sell (50%), newsletters (40%), homepages (31%), and site search results (29%).

Required Actions In addition to the specific recommendations in Chapter Three of this report, to achieve Best-in-Class performance, adopters of personalization technologies must:

• Develop a segmentation strategy and enable rules-based personalization.

• Ensure data quality through controls and manual verification.

• Develop a process for continuous improvement by optimizing relevance and enabling visitor intervention.

“We are building specific information based on the role

of the individual. We think that personalizing in this manner will

encourage longtime customer loyalty. It’s easier and more

fun to use the application when it is personalized; this increases customer loyalty which, in turn,

increases revenue.”

~ Delmar Dehn Chief Executive Officer

Achievance, Inc.




Table of Contents Executive Summary....................................................................................................... 2

Best-in-Class Performance......................................................................... 2 Competitive Maturity Assessment........................................................... 2 Required Actions ......................................................................................... 2

Chapter One: Benchmarking the Best-in-Class ..................................................... 4 Getting to Know Your Customers.......................................................... 4 Maturity Class Framework ........................................................................ 5 Manual or Automated Personalization? .................................................. 5 Best-in-Class PACE Model......................................................................... 6 Targeting Specific Markets: A Personalized Segmentation Strategy .7

Chapter Two: Benchmarking Requirements for Success .................................... 9 Show Me the Money ................................................................................... 9 Competitive Assessment..........................................................................11 Organizational Capabilities and Technology Enablers .......................12

Chapter Three: Required Actions .........................................................................14 Laggard Steps to Success..........................................................................14 Industry Average Steps to Success.........................................................14 Best-in-Class Steps to Success ................................................................15

Appendix A: Research Methodology.....................................................................17 Appendix B: Related Aberdeen Research............................................................19

Figures Figure 1: Segmentation and Unique Profiles are Most Popular.......................... 4 Figure 2: Generating Revenue Ranks as Top Pressure ........................................ 6 Figure 3. Personalization Platform Technology...................................................... 9

Tables Table 1: Top Performers Earn Best-in-Class Status.............................................. 5 Table 2: Best-in-Class PACE Framework................................................................ 7 Table 3: The Competitive Framework...................................................................11 Table 4: PACE Framework .......................................................................................18 Table 5: Maturity Framework...................................................................................18 Table 6: Relationship Between PACE and the Competitive Framework ......18



Chapter One: Benchmarking the Best-in-Class

Personalization of the online experience is a capability that was recognized almost as early as the inception of the Internet itself. During the mid 1990’s, there was a surge in the popularity of personalization as a concept but it quickly lost momentum due to a number of factors including technology limitations, privacy issues, and the overall maturity of the industry. Although 39% of survey respondents still cite privacy concerns as an impediment to personalization efforts, this sentiment hasn’t halted current progress. The technologies available in the marketplace today are equipped to deliver highly targeted personalized services which can impact revenue and strengthen customer loyalty, without jeopardizing customer privacy.

Getting to Know Your Customers The first step in personalizing the customer experience is determining a process for how visitor data will be collected and in what capacity the information will be used. Aberdeen research found that 64% of all companies surveyed will deliver personalized content and products to specific market segments. Instead of offering a web site, campaign or promotion that uses a one-to-many approach, these firms are relying on a one-to-few method. Segmentation is a top strategy for 64% of all companies, including 78% of Best-in-Class, which shows that segmentation is an effective method for contextualizing content and increasing revenue.

In conjunction with segmentation efforts, 46% of all companies target unique individuals by building and maintaining unique user profiles. User profiles rely on information collected about site visitors and customers. Such information includes purchase history, pages viewed, and customer service interactions which all aim to better serve prospects and customers on a personal level.

Figure 1: Segmentation and Unique Profiles are Most Popular

64%

46%

22% 18% 18%

0%10%20%30%40%50%60%70%

Segmentation Unique UserProfiles

Real-TimeSessionActivity

CollaborativeFiltering

Personas

Source: Aberdeen Group, August 2007

Fast Facts

√ 85% of all companies will have some elements of personalization to reach unique customers and specific market segments within the next 24 months.

√ 78% of Best-in-Class use segmentation as a top strategy for personalizing the online experience.

√ Email addresses are stored by 88% of all companies that maintain unique user profiles.



Maturity Class Framework Aberdeen used three key performance criteria to distinguish Best-in-Class companies from Industry Average and Laggard organizations. Data shows that vastly different levels of maturity exist with personalization deployments, yet companies that successfully deliver on their personalization initiatives achieve greater financial gains as a result.

Table 1: Top Performers Earn Best-in-Class Status

Definition of Maturity Class Mean Class Performance

Best-in-Class: Top 20% of

aggregate performance

scorers



• 62% improved revenue per visit as a result of personalization efforts

Industry Average:

Middle 50% of aggregate

performance scorers




Laggard: Bottom 30% of

aggregate performance

scorers

• 0% demonstrated improvement in online conversion rates (3% reported a decline in conversion rates)




Manual or Automated Personalization? The degree to which personalization efforts are automated also provides insight into the maturity of the technology and usage patterns. For example, only 17% of all companies dynamically generate changes to the online experience in real-time, but 31% of Best-in-Class companies currently use this capability. The alternative to an automated process is manual data evaluation and usage, a process used by 65% of all companies and 55% of Best-in-Class companies. Aberdeen data shows that companies with mature personalization efforts will utilize a combination of both manual and automated processes to better target their prospects and customers with relevant and optimized personalization.

“Our most personalized efforts involve [automated] outbound

email campaigns for existing customers.

After registration, customers receive a series of personalized

email promotions.”

~ Michael Klazema, Director of Web Marketing and CRM

– DYMO, a Rubbermaid-owned company



Although potentially more sophisticated, automated personalization does come with a caveat. If not used properly, in a controlled, permission-based and effective manner it can erode customer satisfaction. This is especially true if automation is persistent as in a unique profile. To combat these pitfalls, companies should provide customers with the ability to modify their preferences and stop ineffective targeting. Currently, 40% of the Best-in-Class provide the capability for customers to modify their profiles, which will expand to 80% within the next 24 months.

Best-in-Class PACE Model Using personalization to achieve greater financial gains and elevated customer loyalty requires a combination of strategic actions, organizational capabilities, and enabling technologies.

One of the findings from this research shows that the pressures and strategic actions for Best-in-Class companies are relatively equal for all companies. Increasing overall sales (both online and offline), delivering targeted marketing messaging, and strengthening customer loyalty and retention are the top pressures for all firms (see Figure 2.) These pressures are verified by data that shows 72% of all companies feel personalization will increase online sales, followed by 61% that agree with the statement that personalization will increase offline sales. Finally, 83% of all companies believe that personalization will positively impact customer loyalty.

Figure 2: Generating Revenue Ranks as Top Pressure

60%

38% 38%

58%

42%42% 39% 39%40%

0%

10%

20%

30%

40%

50%

60%

70%

Increase overallsales (online &

offline)

Align marketingmessages with

customer demands

Achieve highercustomer loyalty and

retention

Best-in-Class Average Laggards




Table 2: Best-in-Class PACE Framework

Pressures Actions Capabilities Enablers • Increase

overall sales (online and offline)

• Target content for specific individuals

• Develop business process for segmentation

• Personalize outbound marketing

• Build and maintain unique customer profiles

• Off-site personalized advertising and contextual content

• Link analytics, search and web content delivery technologies

• Relevant cross-sell and up-sell promotions

• Automated segmentation

• Unique user profile database

• Recommendation engine

• Affinity recommendations

• Rules-based personalization

• Predictive analysis • Real-time

personalized content


Targeting Specific Markets: A Personalized Segmentation Strategy Aberdeen research shows that developing a business process for segmenting and targeting customers is a top two strategy for 38% of the entire survey population. Yet for many companies, attracting the right customers through segmentation is only the first step at converting them from browsers to buyers. A number of companies, including 40% of the Best-in-Class, utilize a tactic that draws on the wisdom of their collective site visitors to personalize the experience for future visitors. Collaborative filtering is a process that applies rules-based content delivery predicated on the habits and behaviors of others with similar behavior. For example, a site visitor that is new to an eCommerce site, browsing for products, may receive a notice upon placing an item in her shopping cart for a recommendation for accessories that “others also purchased.” This method of personalization is effective at providing relevant messaging and increasing sales.



Aberdeen Insights – Strategy

Personalization typically takes shape in one of two ways. The first method is that the visitor enters the site and a cookie is created for that particular user. The cookie “remembers” every interaction the visitor has had with the company’s web site (at least until it’s deleted or expires). Information such as demographics, behavior and potential value rankings can be assigned to the visitor and used to personalize the experience. Alternatively, personalization can be session-based so that the experience is guided not by what the visitor has done in the past, but what the visitor is doing at that moment. And finally, the experience can be personalized through authentication, where a user self-identifies through a login process. Best-in-Class companies will incorporate all or a combination of these techniques because there are benefits to each.

Unique user profiles are extremely valuable when used across an organization to improve the experience for visitors. Yet, when sites create multiple unique user profiles for the same customer (which is often the case), the experience is greatly diminished. Currently, 56% of Best-in-Class maintain a unique user profile database to ensure that redundancies are minimized and information is shared across channels. One-third of Best-in-Class companies have automated processes to distribute user profile data to other online applications (such as CRM systems) to offer personalization across multiple contact points within the organizational structure.

Session-based personalization is typically conducted in real-time and relies on the capability of placing the right content in front of the site visitor at the right time. Currently, 28% of Best-in-Class companies are deploying this capability on their sites. The benefits to this strategy are that personalization techniques such as product recommendations and contextual content do not rely on past experiences, which can often be misguided. Take, for example, the site visitor who bought a one time gift for a young niece. The visitor’s experience on the site will be diminished if the customer is bombarded with children’s books upon each subsequent visit.

In addition to these methods, personalization is often guided by affinity tactics which expose visitors to content and products to which others visiting those pages have also navigated. This strategy leverages the collective wisdom of web site visitors to produce information that is most relevant to the visitor. Several vendors provide this type of service through guided search technology, dynamic web content delivery and dedicated personalization technologies. Many of these approaches are very effective in persuading customers to convert from browsers to buyers (a top goal for 21% of BIC), through effective recommendations and merchandising in the form of cross-sell and up-sell promotions.

Although the pressures and actions listed in Table 2 are common to Best-in-Class companies and their peers, leading companies differentiate on the capabilities they possess and the technologies they use to deploy personalized services. Chapter Two will highlight these differences and detail methods used by Best-in-Class to attain elevated status.



Chapter Two: Benchmarking Requirements for Success

Online personalization capabilities are unique in that multiple technologies are capable of acting as conduits for the personalization process. Targeted marketing efforts can originate through data collected from one application and then be utilized by another to serve up personalization. For example, a company might use its web analytics technology to collect and build a user profile, which can be integrated with a CRM system to identify the customer and provide insight to resolve customer service issues.

Figure 3. Personalization Platform Technology

35%

17%

16%

14%

13%

6%

Built In-House

3rd party Personalization provider

Outsourced to IndependentDevelopers

Integrated with Web Analyticssolution

Integrated with eCommercesolution

Integrated with Site Optimizationsolution

All Respondent


Figure 3 depicts aggregate numbers from Best-in-Class, Average, and Laggard companies because no significant differences emerged between the personalization technology platforms. This reinforces the point that the competitive advantages associated with personalization are recognized in the capabilities and enabling technologies Best-in-Class companies have implemented, as indicated in the competitive framework (Table 3) later in this chapter.

Show Me the Money A key component in the decision to personalize comes down to cost for many web operators. The perceptions of value are remarkably strong -- 88% of Best-in-Class companies are in agreement that their companies will recognize a ROI in personalization technologies. Seventy-six percent also agree that the economic gains from personalization will outweigh the costs of implementation.

Fast Facts

√ In-house personalization tactics are 2x more common than any other personalization technology.

√ One-third of Best-in-Class automate the process of distributing personalization data to other web applications.

√ 41% of Best-in-Class link analytics, search and web content management data to perform personalization. This number will rise to 90% within the next 24 months.



Although these metrics express the perceived value of the benefits of personalization, Best-in-Class companies also backed up this sentiment with quantifiable numbers. Thirty-six percent of these firms improved their conversion rates by 1% to 10% as a result of personalization efforts. An additional 24% of Best-in-Class companies improved conversion rates by more than 11% after personalizing their online experiences. In contrast, only 20% of Average companies demonstrated and increase in conversions and a mere 10% of Laggards showed signs of improvement.

Among Best-in-Class companies, 70% realized a lift in online sales as a result of personalization efforts. Average and Laggard companies pale in comparison at 12% and 10% respectively for sales lift as the result of personalization efforts. Each of these financial gains demonstrates that additional value can be gained from online personalization and that if deployed according to best practices, personalization can pay dividends.

Case Study: Michael Klazema, Director of Web Marketing and Customer Relationship Management – DYMO, a Rubbermaid-owned company

DYMO, a Newell Rubbermaid-owned company, is a global provider of labeling products for home, office and industry. “Upon entering the DYMO site, customers experience personalization as a DYMO customer or anonymous site visitor. Our primary focus at this time is on existing customers, yet we see great opportunity in using personalization for acquisition efforts. Allow me give you two examples of how we’re using personalization today.

• First, each person has the ability to create a MyDYMO (www.dymo.com/mydymo) page showing their view of the world depending on their products. For a specific printer, we can showcase the appropriate labels and solutions that are related to the printer. This service requires visitors to register using their name, email and other information so that we can effectively target their products and preferences.

• Alternatively, we use multivariate testing to distinguish owners from non-owners as a method of segmentation. Each group is likely to shop very differently; if a customer visits the support section or navigates directly to labels or supplies; we make an assumption that they are an owner. Once we identify a site visitor as an owner, we target them with specific promotions and personalized products, which has generated a 20% lift in sales for this customer group.

At this time, we don’t have a dedicated staff to run our multivariate testing or personalization efforts. Like most small companies with budget constraints, we like to stay lean and mean and use partners that can help us with turnkey products and services. Our multivariate testing vendor helps us in this way with the creative development on various page scenarios. We run multiple tests a month, and this has been sufficient so far, but we’re still in the first phases of personalization and testing. Our strategy is to evolve to more granular testing and expand the staff to support these efforts.



Case Study: Michael Klazema, Director of Web Marketing and Customer Relationship Management – DYMO, a Rubbermaid-owned company

Our most personalized efforts involve outbound email campaigns for existing customers. We capture customer information because we have a very high registration for printers. After registration, customers receive a series of personalized email promotions. The first is a ‘thanks for registering’ message and used to direct consumer to their personalized MyDYMO pages. The second email, sent 30 days after registration, asks ‘are you satisfied with your purchase?’ We also ask if the customer would like to write a product review. After 90 days, another email goes out asking questions about the purchase asking ‘where did you research prior to purchase, was it an impulse buy or planned purchase?’ We have been very pleased with our personalization and multivariate testing technologies so far. I believe that we will receive full ROI for these technologies within a year. This is in part because we have focused a lot of efforts on our owners and customers who are dependent on the continued use of our refill products, which has been a great success.”

Competitive Assessment The aggregated performance of surveyed companies determined whether they ranked as Best-in-Class, Industry Average, or Laggard. In addition to common performance levels, each class in the competitive framework also shared characteristics in five key categories: (1) process (the ability to effectively capture customer data and provide it back in the form of personalization without placing additional burdens on the organization); (2) organization (the adherence to corporate focus and collaboration among stakeholders); (3) knowledge management (the ability to contextualize data and expose it to key stakeholders); (4) technology (the selection of appropriate tools and the intelligent deployment of those tools); and (5) performance measurement (the ability of the organization to measure the benefits of technology deployment and use the results to improve key processes further). These characteristics (identified in Table 3) serve as a guideline for best practices and correlate directly with Best-in-Class performance across the key metrics.

Table 3: The Competitive Framework

Best-in-Class Average Laggards Data goes through cleansing process to ensure validity:

38% 29% 18% Data produces real-time changes to the site in an automated

process: 24% 14% 8% Data is manually evaluated by marketing team:

Process

56% 68% 70%



Best-in-Class Average Laggards

Organization Organizationally, companies are deploying personalization strategies

using multiple technologies including those mentioned in Figure 3. No single method emerged as a differentiator for Best-in-Class

companies.

Customer service agents have access to user profile data:

73% 53% 42%

Visitors can edit their own profiles/preferences: Knowledge

44% 30% 26% Personalization technology currently in use:

Technology

• 61% unique user profile database

• 48% predictive analysis

• 31% recommen-dation engine

• 46% off-site ad personalization

• 28% real-rime personalized content





• 13% real-time personalized content





• 13% real-time personalized content

Measurement practices for personalization provide the ability to quantify the success and ROI of implementations:

Performance

• 65% measure cost per acquisition

• 62% measure customer retention rate

• 56% measure campaign click thru








Organizational Capabilities and Technology Enablers The essential ingredients of a well-designed personalization strategy are segmentation and/or unique user profile development. Additionally, applying predictive analysis and personalized recommendation technologies will bring an online experience closer to a unique customer. Although these techniques typically rely on a segmentation strategy, they can be effectively used to bring customers targeted products and content. Similarly, real-time personalized content can be generated using today’s tools by recognizing a visitors’ click stream and producing relevant content in the path of that site visitor. Real-time personalization is employed by just over one quarter (28%) of Best-in-Class, yet an additional 61% plan to implement real-time personalization within the next 12 to 24 months. This brings the 24 month adoption rate to 87% of Best-in-Class companies that will utilize real-time personalization tactics in the next two years.



This strategy will most likely surface as personalized recommendations and cross-sell / up-sell promotions for online retailers. While 28% of Best-in-Class companies are currently using a recommendation engine to drive relevant product choices, this number will grow to 83% in the next 24 months. An even greater number of companies, 61%, are currently using cross-sell and up-sell tactics. Adoption of this practice will increase to 98% of Best-in-Class within the next 24 months. Each of these personalization strategies can manifest in affinity recommendations providing information in the form of collective behavior such as: “users who purchased this product also bought X.” Today, 31% of Best-in-Class use this method of recommendation (which can be automated and served real-time) and anticipated growth will exceed three-quarters of Best-in-Class (77%).

Aberdeen Insights — Technology

Personalization plays a major role in behavioral targeting for both web site publishers and ad serving web sites. This strategy uses relevant ads to draw visitors into a web site and persuade them into the buying population with consistent messaging across landing pages and dynamically generated content. The practice of serving relevant content in the form of personalized banner advertising and off-site promotions is in use by 46% of the Best-in-Class. An additional 28% are looking to deploy this type of personalization technique in the next 12 months.

In addition to off-site personalization, many Best-in-Class companies are optimizing their internal sites and are quantifying the value of personalization with multivariate testing. Currently, 33% of Best-in-Class perform optimization testing on their personalization efforts. This number will grow to 77% in the near term future indicating that Best-in-Class have or will implement a process for ongoing testing of personalization effectiveness.

The process of multivariate testing involves rotating elements of a web page to influence click through and conversions. These are measured against thousands of combinations to determine which piece of content performs best in specific locations and combinations. This practice typically requires the technology provided by a multivariate testing vendor. Thirty-percent of Best-in-Class companies currently have this technology deployed, with an additional 43% that plan to implement in the next 24 months.



Chapter Three: Required Actions

Whether a company is trying to elevate its balance sheet or build closer ties to its customers, online personalization requires planning and strategy to execute. Companies seeking to rise from “Laggard” to “Industry Average,” or “Industry Average” to “Best-in-Class,” must follow these prescriptive actions to spur the necessary performance improvements:

Laggard Steps to Success • Start with segmentation and then strategize for unique user

personalization. Current use of segmentation tactics by Laggard companies is in the 60th percentile, yet only 8% automate segmentation. Mature examples of personalized sites dynamically generate content and pages, yet Laggards can start by focusing on identifying profitable segments and funneling customers based on association. After this occurs, then sites should work towards incorporating their unique user information.

• Establish manual processes for delivering personalization. Laggard companies should focus on the easily deployable personalization tactics, such as email. With a 71% adoption rate for personalized emails across all companies surveyed, this is the low-hanging fruit of the personalization arena. Manual processes allow marketers to make calculated decisions for personalization and thereby increase the targeted nature and achieve stronger results.

• Measure the success of your efforts. Personalization requires that companies measure the success of initiatives against a control. Many vendors offer pricing models that are performance based and thus enforce a method of testing against controls. However, technologies but in-house or through other applications must also have a methodology for measuring success. The pursuit of personalization endeavors will rely on these metrics. Additionally, quantifiable metrics can disprove disbelievers and requisition additional funding for personalization efforts.

Industry Average Steps to Success • Derive personalization data from existing applications.

Currently, 41% of Best-in-Class companies link analytics, search, and web content management technologies to deliver personalized services. Only 14% of Average companies are currently performing this data sharing exercise, indicating that they are missing a substantial opportunity. The ability to personalize the online experience is most effective in applications that can already deliver content to site visitors, which can be improved through relevance targeting.

• Take advantage of personalized recommendations. Recommendations are often overlooked as an opportunity to merchandise products and services to customers and prospects. The



ability to target recommendations on a personal level is currently used by only 12% of companies in the form of a recommendation engine and even fewer, (10%) currently leverage affinity recommendations. These applications are opportunities to bring greater significance to the experience of unique visitors and market segments thereby increasing overall revenue.

• Automate the delivery of personalized content. Today, only 15% of Average companies are using rules-based personalization. This method is a process for automating the delivery of content based on predefined factors. Companies that have the greatest success with personalization deploy automated processes that can function without intervention, yet also have balance checks in place to ensure data accuracy.

Best-in-Class Steps to Success • Ensure data quality and enterprise distribution. Only forty-three

percent (43%) of Best-in-Class companies have methods in place to cleanse personalization data and ensure the accuracy of the information they maintain. This process is critical to providing a seamless customer experience and to reduce user profile redundancy where a single user has multiple profiles. The downside to this is inaccurate personalization and dissatisfied customers. Leading firms must ensure the validity of their data and integrate segment and profile knowledge into their enterprise applications.

• Create layers of personalization to accommodate every type of site visitor. Companies with sophisticated personalization practices capture user data at every encounter and offer relevant information throughout an online session. This is true for companies that recognize returning visitors as well as unique users or those that delete cookies. The capability to drive personalization in real-time through session-based activity not only enhances the experience, but also minimizes the propensity to presuppose based on prior history and behavior.

• Actively perform multivariate testing. Leading personalization sites will adopt a method for continuous improvement by rotating content in a personalized and automated fashion. The number of companies currently performing multivariate testing is 30%, which will skyrocket to 73% in the near future. Sites that deploy a dynamic process for determining content effectiveness will reap greater gains than those that do not conduct quantifiable experiments.



Aberdeen Insights – Summary

Online personalization is not a technique to deploy if you have expectations of an immediate big bang impact and results. The benefits of personalization surface with careful planning and by gradually introducing personalization techniques in a calculated manner. Sites that reveal the depths of their knowledge about a customer’s behavior will invoke privacy concerns and potentially undermine the benefits of the revenue and loyalty they seek to gain. Effective personalization requires subtle use of implicit information and opportunities for site visitors to offer explicit information to guide their online experience. Companies that nurture the relationships with their customers and build trust with relevant and accurate personalization techniques will make greater strides toward achieving their financial and customer-centric goals.





Appendix A: Research Methodology

Between June and July 2007, Aberdeen Group examined the use of personalization technologies and the experiences and intentions of nearly 300 individuals in organizations across a diverse set of industries. Responding organizations completed an online survey that included questions designed to determine the following:

• What are the external pressures driving your company to deploy or improve upon its personalization tactics?

• Which strategic actions will you take to address the pressures regarding personalization?

• Where do the technological capabilities lead you in terms of selecting appropriate personalization tools and services?

• How have the enabling personalization technologies contributed to the success of your personalization efforts?

Aberdeen supplemented this online survey effort with telephone interviews with select survey respondents, gathering additional information on personalization strategies, experiences, and results.

The study aimed to identify emerging best practices for online personalization and provide a framework by which readers could assess their own capabilities.

Responding enterprises included the following:

• Job title/function: The research sample included respondents with the following job titles: CIO or other C-level officer (23%), VP or Director (34%) Manager or staff (25%), consultants / other (18%).

• Industry: High technology / software organizations represented 26% of the sample. Retail comprised 17%, telecommunication services 12% and finance / accounting / banking represented 10%. Other sectors responding included automotive, computer equipment and peripherals, publishing / media, and distribution.

• Geography: Over two-thirds of respondents (67%) were from North America. An additional 20% were from Europe, Middle East and Africa, and 11% were from the Asia-Pacific region, with 2% from rest of world.

• Company size: Approximately 20% of respondents were from large enterprises (annual revenues above US$1 billion), 29% were from midsize enterprises (annual revenues between $50 million and $1 billion), and 51% of respondents were from small businesses (annual revenues of $50 million or less).

Solution providers recognized as underwriters of this report were solicited after the fact and had no substantive influence on the direction of this report. Their sponsorship has made it possible for Aberdeen Group to make these findings available to readers at no charge.



Table 4: PACE Framework

PACE Key

Aberdeen applies a methodology to benchmark research that evaluates the business pressures, actions, capabilities, and enablers (PACE) that indicate corporate behavior in specific business processes, defined as follows:

Pressures — external forces that impact an organization’s market position, competitiveness, or business operations (e.g., economic, political and regulatory, technology, changing customer preferences, competitive)

Actions — the strategic approaches that an organization takes in response to industry pressures (e.g., align the corporate business model to leverage industry opportunities, such as product/service strategy, target markets, financial strategy, go-to-market, and sales strategy)

Capabilities — the business process competencies required to execute corporate strategy (e.g., skilled people, brand, market positioning, viable products/services, ecosystem partners, financing)

Enablers — the key functionality of technology solutions required to support the organization’s enabling business practices (e.g., development platform, applications, network connectivity, user interface, training and support, partner interfaces, data cleansing, and management)


Table 5: Maturity Framework

Maturity Framework Key

The Aberdeen Maturity Framework defines enterprises as falling into one of the following three levels of practices and performance:

Best-in-Class (20%) — WLAN security practices that are the best currently being employed and significantly superior to the industry norm, and result in the top industry performance. Industry norm (50%) — WLAN security practices that represent the average or norm, and result in average industry performance. Laggards (30%) — WLAN security practices that are significantly behind the average of the industry, and result in below average performance.

In the following categories: Process — What is the scope of process standardization? What is the efficiency and effectiveness of this process? Organization — How is your company currently organized to manage and optimize this particular process? Knowledge — What visibility do you have into key data and intelligence required to manage this process? Technology — What level of automation have you used to support this process? How is this automation integrated and aligned? Performance — What do you measure? How frequently? What’s your actual performance?


Table 6: Relationship Between PACE and the Competitive Framework

PACE and Competitive Framework How They Interact

Aberdeen research indicates that companies that identify the most impactful pressures and take the most transformational and effective actions are most likely to achieve superior performance. The level of competitive performance that a company achieves is strongly determined by the PACE choices that they make and how well they execute.




Appendix B: Related Aberdeen Research

Related Aberdeen research that forms a companion or reference to this report includes:

• Online Content Speaks Volumes Benchmark Report, June 2007.

• Web Analytics: The Crystal Ball of Customer Behavior? Benchmark Report, April 2007.

• Web Site Search: Revenue in the Results Benchmark Report, February 2007.

• Clicks to Customers: The Real ROI in B2C eCommerce Benchmark Report, December 2006.

• Web Personalization Hat Trick: Revenue, Loyalty & Conversions Perspective, February 2007.

Information on these and any other Aberdeen publications can be found at www.Aberdeen.com.

Author: John Lovett, Research Analyst, Online Customer Experience Practice Founded in 1988, Aberdeen Group is the technology- driven research destination of choice for the global business executive. Aberdeen Group has over 100,000 research members in over 36 countries around the world that both participate in and direct the most comprehensive technology-driven value chain research in the market. Through its continued fact-based research, benchmarking, and actionable analysis, Aberdeen Group offers global business and technology executives a unique mix of actionable research, KPIs, tools, and services. This document is the result of research performed by Aberdeen Group. Aberdeen Group believes its findings are objective and represent the best analysis available at the time of publication. Unless otherwise noted, the entire contents of this publication are copyrighted by Aberdeen Group, Inc. and may not be reproduced, stored in a retrieval system, or transmitted in any form or by any means without prior written consent by Aberdeen Group, Inc.

http://www.aberdeen.com/summary/report/benchmark/4010-RA-online-content.asp

http://www.aberdeen.com/summary/report/benchmark/3975-RA-WebAnalytics.asp

http://www.aberdeen.com/summary/report/benchmark/RA_Web_Site_Search_3910.asp

http://www.aberdeen.com/summary/report/benchmark/RA_Clicks_JL_3710.asp

http://www.aberdeen.com/summary/report/perspective/PER_Personalization_JL_3888.asp

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This Time It's Personal: Making Online Experiences Uniquemarketing.adobe.com/resources/help/en_US/tnt/pdf/Aberdeen_Online... · strengthen customer loyalty, ... Segmentation is a