Since the first store was opened in Dallas, Texas in 1973, Michaels has grown to be the largest arts and crafts retail chain in North America, with more than 1,200 stores in the U.S. and Canada. A big reason for their growth has been Michaels’ connection with their customers, affectionately known as “Makers”. Since day one, the company has provided everything that beginners and experts need to complete an array of artistic, leisure, and home décor DIY projects from start to finish. It’s no easy task connecting with and understanding all of those Makers’ needs, especially today in such a noisy digital environment. So they needed a complete digital personalization strategy.
Michaels knew they had to deepen customer engagement through omnichannel personalization They also had to increase the frequency of those engagements to maintain and enhance customer loyalty. To achieve these goals, they recognized a need for an omnichannel personalization strategy in order to build more meaningful relationships at scale. SMS, Facebook, and email were the channels Michaels wished to amplify and, in turn, create more authentic ongoing relationships with Makers by using Generative AI to create the right messaging for the right customer.
Personalization Strategy: Optimizing the Customer Journey Through Omnichannel Personalization
As part of Michaels’ ongoing digital transformation to give Makers a best-in-class experience both in stores and online, the company made a conscious decision to rethink its digital strategy and put omnichannel personalization at the forefront of its marketing efforts.
Michaels knew it needed to expand its personalization strategy across channels and streamline its communication to individual Makers. This task was humanly impossible to manage because Michaels wanted to personalize each individual’s experience and connect with its Makers in a more authentic, helpful way. To do this efficiently, they chose to bring in Generative AI. This technology enabled Michaels to create personalized experiences for their Makers at scale.
“We had all of this really rich data, but we needed to figure out a way to use it that allowed us to produce more relevant content that would inspire and enable creativity for each and every one of our Makers. We wanted to build upon the deep trust our brand has built with our Makers over the past four decades by creating even more meaningful, personalized touchpoints with them. With millions of Makers in our community who all have unique needs and preferences — from their craft of choice to their skill level — it was a challenge to do this at scale.” said Sachin Shroff, VP of CRM, Loyalty, and Marketing Technology at Michaels
The big question for Michaels was not whether it should personalize its campaigns, but how, exactly, it would build those more meaningful, personalized relationships at scale.
As an omnichannel retailer, Michaels had already been tapping a variety of digital channels to reach customers, including email marketing and Facebook ads. These were used to do everything from alerting customers to new promotions and products to featuring classes and projects to elevating Maker profiles.
The problem was that while this content was broadly appealing to their customer base, it wasn’t speaking to the particular needs of specific audiences or customer profiles to the degree that Michaels wanted. It also wasn’t generating the kinds of insights Michaels could use in other marketing activities. As a result, the campaigns from their digital channels weren’t driving the Maker loyalty that Michaels knew was possible.
“Even though we were generating lots of data from our customers, our analysis of it was very subjective. It was time to look for a partner that could help activate all of that data and use it to deliver the messages that would engage Makers on an individual level and keep them coming back.” said Stephanie Turner, Michaels’ Director of Targeted Marketing
AI Marketing Tools for Content Personalization Strategy
Michaels found that partner in 2019 when Persado, the Motivation AI company that generates personalized communications at scale, came knocking. Persado worked with Michaels with two goals in mind. The first was to put the Persado Motivation AI Platform to work to deliver campaigns with more engaging, personalized language that would drive loyalty and incremental revenue. And secondly, to deliver insights that would allow Michaels to make creative, strategic decisions about their marketing and customer experience.
Michaels decided that it wanted Persado to focus on campaigns in three channels: SMS, Facebook, and email. The Persado Motivation AI Platform generates and predicts which words will perform best in any campaign using the most extensive proprietary language knowledge base of over a million tagged words and phrases mapped to human emotion. It essentially takes the guesswork out of crafting customer messaging by tapping into the equivalent of 600 years of consecutive A/B testing.
How Persado used Generative AI to Bring About Omnichannel Personalization Strategy:
- Persado began by using the company’s content to build a custom language model that is true to Michaels’ brand voice.
- Persado then generated and deployed language experiments to feed predictive models that understand how customers engage with messaging across campaigns, channels, and audiences.
- Finally, Persado used those learnings to predict the right message for future campaigns, enabling Michaels to deliver more relevant content to its Makers.
“The degree to which the AI platform allows Michaels to understand the language that resonates best with each Maker is incredible,” said Shroff. “Our email subject lines, for example, are less transactional and are instead tailored to the specific.”
AI-generated Content Drives Results
So what happened when Michaels went from personalizing 20% of their email campaigns to personalizing 95%? A 25% CTR lift on email campaigns. They also saw a 41% CTR lift on SMS campaigns using the same strategy.