Personalization - it's all the rage! And it's no wonder because people are coming to expect a personalized experience both online and offline, driven in part by the mobile experience. Analytically-driven marketing software makes personalization possible and examples abound of organizations that are doing quite well at it.

But here's the catch - often those processes depend on the customer allowing themselves to be identified, or known. Affinity programs usually enable (and reward) people to self-identify, and location-based services enabled on smartphones allows that to happen as well.

But what about those situations where you don't know the customer - either by choice or by circumstance? My colleague Kelly McGuire is a subject matter expert on the hospitality industry and she recently explored this issue in an excellent post to another SAS blog. Because her hospitality industry examples could very well apply in other industries, I'm very happy to highlight excerpts from her post below.

Of particular interest are five key tenets to effective customer experience personalization.

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Do I know you? Personalization without a guest profile.

With so many possible ways to engage with new potential guests, hotels run the risk of becoming commoditized as they strive to differentiate themselves from competitors and third party distributors. In an effort to connect better with guests, most hotel companies are focusing on improving the guest experience, whether through personalization efforts or giving guests more control over their experience through mobile check-in, mobile keys or choice of rooms.

To support this effort, hotels have been talking about getting that 360 degree view of the guest – gathering as much information as possible about needs, preferences and behaviors across all of their interactions with the guest.

The idea is to leverage this information through the guest journey to provide more relevant offers, improve communications and increase engagement.  Loyalty programs help hotels to gather this data – effectively rewarding guests for being willing to provide information about themselves. Hotels also try to gather and match any personal information provided at reservation or checking – emails, phones address, and tie that back to a person or a stay.

Even with a customer profile available, having to stitch together fragments of data collected across the guest journey is challenging, and most hotels only “know” a small fraction of their guests. Most of the traffic to the website, or even guests in the hotel at a given night, are not included in the hotel’s guest database. So, if you don’t know the majority of your guests, how can you implement personalization initiatives?

Interacting with an unknown guest is all about using what you can see about them (no matter how little) and analytically comparing that to what happened with other guests who looked or behaved like that. By tracking their search behavior and clicks, a picture begins to form of what they might be looking for, and potentially who they are. Using this information, compared to the activities of “known” guests, the website can start proactively surfacing relevant content, understanding options for “next best offer”, tracking the visitor’s reaction and then incorporating that back into the decision of what to surface next.  The IP address can be recorded, and the next time the unknown guests comes back, you can use what you learned from their previous search behavior.

Some of the actions may be based on business rules (if the visitor searches for resort properties, show beach pictures in the sidebars), and other actions can be based on analytic results (predictive modeling shows a 20% increase in booking likelihood when guests who followed a certain path were shown this specific piece of content). It doesn’t have to be that complicated, really. Just use what you can see to help the guest cut through the “clutter” of all of the many option you have available to find exactly what they are looking for.

The results of these interactions will not be as accurate as when you have a richer profile of the guest. At least you can start testing and learning, and trying to be a little better than a generic web experience. You will get better over time with that specific visitor, and with your customer base in general.

Five key tenets to effectively personalize the customer experience on your website:

• Offers should be profitable, driving business where it’s needed and protecting the firm from revenue dilution. Revenue management forecast and price recommendations should be incorporated into the offer delivery on the website and through other channels. Customer value should be carefully understood so that you are not over-incentivizing guests.
• Make it easy to do business with you. In the process of intelligently surfacing content and improving the guest website experience, don’t forget that your whole goal is to convert. If the guest can’t find the “book now” button in the middle of all of your beautiful, search engine optimized content, they will go elsewhere.   Throughout the entire search experience, it should be crystal clear to the guest what they have to do to make a booking. The OTAs do it, hotels should too.
• Profiles and business rules can be dangerous. As you are building a guest profile, remember that demographic information alone does not form a complete picture of who the guest is. Behavior and context are also crucial pieces of information that fill out the picture. Simply using demographics and applying business rules will result in bad decisions. Think about the business traveler who this time is taking the family on vacation. Their needs and preferences will be dramatically different. Think about the variety that could exist within a segment made up of young professionals from the Northeast who tend to stay in city center hotels.
• Don’t cross the line to creepy. Just because you can collect information about your guests (mining their Twitter page, stalking them on Facebook), doesn’t mean you should or you should use it directly. The winning companies will be able to properly operationalize the information they collect or derive to improve the guest experience. It is going to be really easy to get this wrong. Companies already are. For every piece of data you collect or insight you derive, be sure to ask yourself what you would use it for. If you don’t have a good answer, don’t waste your time.
• Make it valuable for the customer. Last and certainly not least -- just as your offers should be profitable, ultimately the arbiter of what's valuable is the customer. Any element of your website should always have a valuable purpose for the customer - to inform, to delight, to make them productive and perhaps most importantly - to remind them they are valued.

Differentiation in the noisy digital space is becoming increasingly difficult. Guests can come to you through a variety of paths, and for a plethora of different reasons. Using the digital crumbs they drop along the way can provide opportunities to improve their experience, drive their loyalty and repeat business, and improve the hotel’s revenue and profits – no matter how much or little you already know about them.

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Many of the examples that Kelly can easily apply to other industries, because it's always about engaging customers and meeting their needs. So how do they apply to you?

POST-SCRIPT: My apologies for originally publishing this post with just four tenets. It was an oversight on my part as I was multi-tasking. When I took a peek early the next morning, I found that I accidentally left tenet #5 in the draft document from what I cut-and-pasted. I'll try not to do it again!