Personalization In 2012: Intent Leads, Social Matures

While personalization has existed for more than a decade,  emerging as a priority for every online retailer, 2012 is shaping up to be a truly innovative year for relevant, in-the-moment personalized experiences for consumers.

To understand the context for these innovations, it is important to look back. Prior to this year, only vendors with deep pockets or sophisticated algorithms, such as Google, could hope to create highly relevant experiences. That’s because a completely new way of thinking was required to understand how to process information in real-time to make decisions that impact in-the-moment experiences. The alternative was to use aggregate data and batch processes that delivered less than ideal results. That, however, is about to change.

Here are some of the top trends to watch in 2012:


Big Data In-the-Moment. During any online interaction, web browsers and applications create massive amounts of data. Prior to 2011, capturing and utilizing big data ― the  consumer behavior data needed to make actionable business decisions ― was the providence of a few very powerful companies. In 2011, we saw the rise of Hadoop, which for the first time is giving companies the ability sort through big data. In 2012, Hadoop will see wide adoption, which will give retailers and their vendors increased power to collect and analyze this valuable big data in near real-time.

Facebook’s Worth Revealed. With a slew of major retailers, including Gap, J.C. Penney and Nordstrom,  recently closing their Facebook storefronts, it’s clear the real value in social for retailers is not about the eyeballs, but in the data. The real benefit of the social graph is that information is input directly by consumers, making it much more accurate than zip code aggregates that marketers have been using for years. To date, many retailers have not been able to use this highly specific social data in their systems. In addition, the value of the social graph goes beyond individual profiles to the influence consumers have on their friends and how the retailer can connect with them. In 2012, retailers and their vendors will make strides in mining the social graph for meaningful signals. Then they will integrate that data with information about the shopper’s intent directly into their own web sites to create more relevant, personalized experiences.

The Rise Of Consumer Curated Content. Facebook proved not to be the right destination for social commerce, mainly because most consumers use the social network to connect with friends, not to shop. Retailers stand to gain real value from social through the proliferation of retail-themed content curators such as Pinterest. When consumers curate content, they create connections and patterns that did not exist before. These affinities will give retailers new insight into trends and how products fit together. This insight can be used to drive real business decisions. With greater usage of the social graph, expect to see huge value extracted by serving shoppers a more targeted experience based on real-time intelligence rooted in their profiles and the products they’ve recently pinned. There is enormous value to be unlocked in the personal data behind sites like Tumblr, Spotify, Pinterest, and other services that can be used by retailers to make a significant impact on the bottom line. 

Scott Brave, Ph.D, is a founder and CTO of Baynote, Inc. Prior to Baynote, he was a postdoctoral scholar at Stanford University and served as lab manager for the CHIMe (Communication between Humans and Interactive Media) Lab. Brave is an inventor with six patents and co-author of more than 25 publications related to human-computer interaction and artificial intelligence. He also is an editor of the “International Journal of Human-Computer Studies” and co-author of “Wired for Speech: How Voice Activates and Advances the Human-Computer Relationship.”

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