PERSONALIZATION VIA SUBSCRIPTION AND SERVITIZING

Introduction In this age of hyper-personalization, people want to feel special. They expect brands to understand and respond to their individual needs. They want something you meet for them, not something from a mass marketing strategy. The customers are craving for a more meaningful connection with the brand, and they also want it fast. Today customers are time-poor and require a quick solution. The challenge and opportunities for businesses are to pinpoint those exact moments when customers are looking for a specific thing such as pieces of product or piece of information, and then quickly give it to them. In fact, the window to give the customer what they are looking for is just a few seconds, and it could be preferred as a micro-moment. Trend Overview 2. 1. The Trend Of Personalization Via Subscription And Servitization. The paying for services could further develop into paying for usage, as this is something how the customer can get an even more personalized offering. You could even get a construction, whereas a viewer pays in a few dongs (cents) per second. Blockchain technology will make it possible to support such a structure with lower transaction costs. Cheap, tasty, tonic items are always the three options customers are looking for. It can be said that this is one of the most important future trends driven by the increasing cornification of products and services. Organizations of all kinds can now delight customers with thoughtful subscription-based services and products. This trend is all about moving from a traditional business model, where the customer buys the services or products when they need them, to one where they sign-up and receive service or product on a registered basis. The customers benefit from convenience, alter, renew and build a deeper connection with the brand they love. Meanwhile, the businesses generate and put it into revenue because as long as you continue to provide value to the customers, they will continue to pay for it. We have seen that companies like Apple are moving to this service model or even cars. Some of the names can be listed here, such as Apple, Spotify, or Netflix. Traditional production companies are already working together with Netflix to produce original content, using traditional production methods but skipping traditional broadcasting methods instead of releasing directly to Netflix. TV channels will likely vanish, and even Hollywood could in the future release full-length films to Netflix directly, where Netflix subscribers can pay an 'early bird' fee to watch the movie. Netflix is very successful because they exactly know what customers want when they want it and what device. Also, the company is bold and courageous enough to keep changing its business model to the most optimal future and not afraid to cannibalize its current business model. 2. 2. Personalization & Hyper-Personalization 2. 2. 1. Personalization The core of this trend is personalization. We can learn from Amazon, Netflix, or Caterpillar about the power of personalized services for customers. Today, many successful businesses are traveling on this servitization journey, which is ultimately all about delivering outcomes (from your products or services) for the customer. That journey also increasingly means getting closer to the customer and finding out exactly what outcomes derive from the products. Ideally, businesses need to build much more direct relationships with individual customers to understand how their products are being used in the field. Ideally, businesses need to build much more direct relationships with individual customers to understand how their products are being used in the field. 2. 2. 2. Hyper-personalization Amazon was a pioneer of this idea that each customer needs to be treated as an individual who must be served. Each customer's browsing and buying history within their Amazon account became the basis for insight which could be put to work to recommend other content which fitted that customer's preferences based on their Amazon transaction history. Netflix went down the same route as 'hyper personalization' came of age. Building personalized insight about your customers, rather than just your customer segment, is key to success for businesses being paid via outcome or usage-based subscription. If you get this right, customers will be much more loyal than they ever were before. If you get it wrong, your customers will hang you out to try via their social media brickbats. It stops being about mass production and swamping the market with products that may or may not work for the end customer – and starts being about customizing the product to fit the individual needs of that customer at any point in time. Of course, we now pay for everything via subscription from our Apple Music account to our Amazon S3 data backup service, Netflix, Sky, and all the Software as Service subscriptions that we use in our offices. 2. 3. Servitization In its simplest terms, servitization refers to industries using their products to sell "outcome as a service" rather than a one-off sale. Rolls Royce is a well-known example of servitization, changing its operating model from the sale of jet engines to the sale of power on an hourly basis. So, what are the advantages of servitization? That is growth in revenue and profit, improved responses to customer needs, product innovation, and the building of new revenue streams. Servitization offers an unprecedented opportunity to build tighter relationships with customers. They can use it to add intelligence to their products, collect valuable data on customer usage, inform design and performance improvements, and test those improvements before rolling them out at scale. They will also find out fast when that consumption changes and pre-empt a switch to an alternative product or service by offering a deal to secure them for longer. Customer lifecycles can be extended from perhaps 12 months to 10 years or longer if vendors get servitization combined with their subscription models right. This servitization is all about changing from a product to a service and prolonging the customer's life cycle. Factors Supporting The Trend Of Personalization Advances in technology, data, and analytics will soon allow marketers to create much more personal and "human" experiences across moments, channels, and buying stages. Physical spaces will be reconceived, and customer journeys will be supported far beyond a brand's front door. Al in all, the main factors that cause personalization can be divided into three terms: customers' personal needs, technologies' advancement, and innovation encouragement. Deloitte - a multinational professional services network - did research and showed that, on average, 36 percent of consumers expressed an interest in purchasing personalized products or services. Furthermore, 48 percent said they were willing to wait longer for a personalized product or service. Customers are more likely to act on the campaigns which display their names. Also, some customers claim that they go for brands that have a reputation and name. Therefore the unknown brands have to pull up their socks to fetch users' attention. You can get users' information through surveys and accordingly give them offers and discounts. At the same time, you have to keep on creating awareness amongst the customers about your products via articles and blogs so that they do not forget your products. Vietnam Is Taking The Opportunities 4. 1. Key Benefits Of Personalization Trend Improve Customer Experience Increase in Revenues Increase Customer Retention Enhance Brand Loyalty Just like the case of Netflix, it provides continuous entertainment to users. They come up with unique strategies to entertain users. Their "You might also like" section, which gives special suggestions and recommendations to the users. But at the same time, they create the artwork as per the interests of the users. They are using personalization as a core strategy to win the viewers' hearts by putting the right content for them. Turning them into a business strategy can help Vietnamese businesses benefit and utilize the trend successfully. 4. 2. Vietnam Implementation In theory, this sounds like a trend for businesses, but no, this is a consumer trend. To understand better, let us look at the case of Netflix or Spotify, the two hottest paid apps at the moment in Vietnam. While these are paid apps, they attract many willing-to-pay-subscription-fee customers to become loyal and willing to renew with the business after the product enrollment period is over. The world music streaming application Spotify officially knocked on Vietnam's door on March 13, 2018, has created a fever for the online music listener community. However, the story is that Spotify is not the first online music application, much less the only one. Pandora, Tidal, or even Apple Music are not weak opponents at all. How can Spotify compete in the Vietnamese market and change the habits of Vietnamese people listening to pirated music? The answer lies in the personalized user experience. Experience of personalization is a hotspot in Spotify's marketing strategy. Spotify did something that Apple Music or even domestic companies at that time, like MP3 Zing and Nhaccuatui, could not do. This is one of the things that sets Spotify apart. Using machine-learning technology (or self-learning), Spotify can analyze each person's music listening habits, making suggestions for playlists or tracks suitable for music genres and artists listened to frequently. Spotify said that when users choose to stream songs for each moment, their personalities are revealed, what they are doing, how they are feeling; All are aggregated by Spotify's music analysis mechanism (Streaming Intelligence). For brands and marketers, this mechanism offers a unique opportunity to deliver the right message to the right audience at the right time. The Vietnamese market is gradually becoming more sensitive to trends in the world. There are many young people in Vietnam, trending tastes are also increasing, so it is extremely necessary to learn and create a personalized experience for customers. So, how could this trend happen in Vietnam, and how could Vietnamese companies prepare and utilize this trend? The examples and case studies above are all from the entertainment industry. Besides, other industries can fully pursue this consumption trend because this is an inevitable widespread trend based on the strong development of technology. Along with the strong digitization trend, the banking industry has made important changes to catch up with the 4. 0 trend and 'understand' customers better. A series of financial applications have been launched to provide the ultimate personal experience for customers. Banks often focus on seamless experience, multi-utility services, updating trends, creating interesting, different, and especially "personalization" according to the wishes of users. For e-commerce, personalization has always been built-in and recently became obvious. Easily recognizable through Vietnamese e-commerce platforms such as Shopee, Lazada, Tiki, etc. , they try to optimize the user experience by personalizing searches, suggestions and offers. Like other fields, the personalized education model has also appeared for a long time and has become a basic education requirement in the 4. 0 era. We admit that the biggest challenge in education is dealing with the differences between individual learning styles and speeds. Therefore, each person needs a teaching and learning program suitable to their needs, abilities, interests, background, . . . That is personalization in education. In the era of technology development, machines can replace humans to handle a series of pre-programmed operations. Therefore, if humans cannot make a difference but only look like machines, they will soon be replaced. Personalization in customer experience is not strange but has not been focused on, so it is time for Vietnamese businesses to consider their direction and change their strategy. What they need to do is not bring the trend from the world to pressurize the domestic market, but create a trend from a similar foundation. More broadly, Vietnam can completely be a trendsetter if businesses make more efforts in absorbing, learning, and creating, and avoid being rigid, conservative, and copying ideas. Conclusion In the era of all things digital, consumers have higher expectations: they want their interactions with businesses and the products and services they buy from them to be personalized. Offering mass personalization allows businesses to demonstrate the value consumers get from their personal data being used. At the same time, businesses gain deeper insight into consumer behavior. Personalization could also help improve efficiency, reduce costs, and offer a path to sustainable growth. Personalization is a great strategy to let your users know that you care for them, and their choices and preferences matter the most to you. But you shall not invade the privacy of the consumers. Try to engage them at the right times. If you get too clingy to the users, they will push you away. Think from their perspectives and engage them accordingly.