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Personalization Is Profitable and Other Key Takeaways From Twilio’s State of Personalization Report.

A maze inside a human's head

Twilio’s State of Personalization report for 2023 highlights the importance of personalization to today’s consumer. In this survey, 3,001 adult consumers who have purchased something online in the past 6 months and 500 decision-makers at consumer facing companies that provide goods and/or services online were surveyed.

The report highlights that consumer's expectations are evolving at a rapid pace and businesses are largely failing to rise to the challenge. In spite of additional investments in personalization consumers are reporting that experiences are largely becoming worse, and they are getting less comfortable with sharing the data you need to drive personalization.

If companies don't figure out how to use personalization to create experiences that delight, they run the risk of consumers pulling the rug out from under them by taking away the very data that personalization is built on. This change would leave companies with much narrower paths to create personalized experiences leaving them at a competitive disadvantage.

Here are some key takeaways from the report:


Personalization is profitable: 80% of business leaders say consumers spend more (38% on average) when their experience is personalized.


Personalization breeds loyalty: Over half (56%) of consumers say they will become repeat buyers after a personalized experience, a 7% increase year-over-year.


Personalization is hard: 39% of businesses say that they struggle with implementing personalization technology effectively and half of companies feel like getting accurate data for personalization is a challenge, a ten-point increase year-over-year compared to 2022.


Primary among those challenges are: lack of people and process training (42% of respondents), security or compliance challenges (36% of respondents), poor organizational processes (34% of respondents), and poor quality data (31% of respondents).


Gen Z has high expectations: Younger consumers are the most likely to react negatively after an impersonal experience. 49% of Gen Z say they’re less likely to make a purchase and 27% say they’ll stop shopping with the brand or share the negative experience with friends or family.


 - Businesses are making real investments: Nearly 69% of business leaders are increasing their investment in personalization despite challenging economic headwinds.


- AI is leading the charge: 92% of businesses are using AI driver personalization to drive growth.


Trust is low and eroding at an alarming rate: Only 51% of consumers trust brands to keep their personal data secure and use it responsibly and just 41% of consumers are comfortable with AI being used to personalize their experiences.


In fact, 1 in 4 consumers are less comfortable about their personal data being used for personalization compared to last year.


Consumers aren’t feeling the value of recent investments: 27% of consumers surveyed feel personalization is become less targeted over the past 12 months.


It’s becoming clear that personalized customer journeys are becoming a competitive advantage for those companies willing to invest the resources, time, effort, and energy into building them.

In our next blog, we will cover some takeaways from our latest webinar focused on this study that will help you kickstart your company’s path to personalization and provide clear guidance on how to meet the challenges highlighted here head on.

Can’t wait that long? You can view a recording of the webinar here


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