The Digital Transformation Playbook: Rethink Your Business for the Digital Age

Personalization: Tailoring to Fit
Once businesses are targeting micro-segments of customers, the next 
opportunity is to treat them each differently, in ways that are most rel-
evant and valuable to them. This is the third template for creating value: 
personalization. By tailoring their messaging, offers, pricing, services, and 
products to fit the needs of each customer, businesses can increase the value 
they deliver.
Kimberly-Clark, which sells some of the biggest brands in diapers 
(among other personal care products), uses an audience management plat-
form that integrates data from sales and media channels to build an inte-
grated view of the “customer journey” of each customer. For the company’s 
business, that means tracking a family’s progression through various prod-
ucts—from Huggies newborn, to full-size diapers, to transitional pull-ups 
during toilet training and “Little Swimmers” (for kids just starting out in 
the pool). Keeping track of each customer allows it to advertise the right 
product to the right family.
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British Airways has launched a service personalization program known 
internally as Know Me. Its goal is to bring together diverse data to create a 
“single customer view” that will help airline staff to make a more personal 
connection with each customer. Know Me started with a two-year project 
to link data from commercial, operational, and engineering systems and 
put it at the fingertips of customer service directors. But the program works 
only because the data analytics are linked to the judgment and “emotional 

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intelligence” of the British Airways service staff. Know Me data is used 
to deepen staff awareness of fliers’ personal needs and preferences, and 
staff are empowered to make their own observations and record data that 
helps personalize future trips. This feedback loop helps the airline deliver 
more-relevant offers to each customer and provide personalized recogni-
tion and service during a trip. That can include recognizing a VIP business 
traveler—even when traveling in coach class with family—so that service 
staff can welcome and thank them and offer a glass of champagne. It could 
also mean providing discreet assurances to a customer who has previously 
indicated they have a fear of flying. With urgent updates entered in the 
system in minutes, one flight crew spotted a passenger’s iPad, forgotten on 
board, and passed word to the connecting flight crew to notify the passen-
ger. One of the most popular service touches has been that of welcoming 
customers mid-journey when they have reached Silver Tier status, the first 
level that offers access to lounges. The airline has seen extremely positive 
response from customers, both one-on-one and in long-term tracking of 
their satisfaction and their likelihood of recommending British Airways to 
others. In addition, Know Me has allowed the airline to broaden its view of 
customers far beyond its loyalty-program members, with a goal of knowing 
the needs of all of its 50 million fliers.
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One challenge of personalization has been the proliferation of differ-
ent devices and platforms where customers interact with a business. How 
does a business know it is communicating with the same individual on a 
phone, tablet, and PC, let alone through Facebook, its own shopping portal, 
or a display ad being served up by Google on pages all over the Internet? 
The good news is that this challenge is diminishing rapidly, allowing for 
“addressability” of the same customer across numerous platforms. As David 
Williams, CEO of database powerhouse Merkle, explained, we are quickly 
becoming able to communicate to individual consumers with “address-
ability at scale” across Google, Facebook, Amazon, and all the dominant 
platforms of the Web.
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Context: Providing a Reference Frame
The final template for data value creation is context. By providing a frame of 
reference—and illustrating how one customer’s actions or outcomes stack 
up against those of a broader population—context can create new value for 
businesses and customers alike.

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Putting data in context is at the heart of the “quantified self ” 
movement—evidenced by customers’ rising interest in measuring their 
diet, exercise, heart rates, sleep patterns, and other biological markers. Nike 
was one of the first companies to tap into this trend with its Nike+ plat-
form, which originally used in-shoe sensors, then the Nike Fuel wristband, 
and later mobile software apps. At each stage of its development, Nike+ 
has been designed to let customers capture their data and share it with 
their online communities. Nike customers who track their running data 
don’t just want to know how they did today; they also want to know how 
today’s performance compares to their own performance over the last week 
or month, to the goals they have set, and to the activity of friends in their 
social network. Context is king.
Comparing their own data with the data of others can also add value 
by helping customers understand the probabilities of different outcomes. 
Naviance is a popular platform for U.S. high school students preparing for 
the college search and application process. One of its primary services is a 
tool that lets students upload their transcript data (test scores, class grades, 
high school attended) and compare it against a huge database of students 
who have applied to college while using Naviance. Based on the past results 
of similar applicants, the platform can show students their likely odds for 
admission to different colleges they are considering. Rather than applying 
in the dark (as we did in my day), students can use Naviance to find out 
which college on their list is a long shot, which one is a sure thing, and 
which schools fall in between.
Sharing and comparing customer data can be a powerful way to iden-
tify hazards. BillGuard is a popular financial protection app that tracks its 
customers’ credit card statements and helps identify both fraudulent billing 
(e.g., if the card was one of 50 million hacked in the latest cyberscandal) 
and “grey” charges (hidden fees customers likely didn’t realize a company 
was charging them). BillGuard’s algorithms are effective precisely because 
they compare a customer’s bills against the anonymized bills of peers and 
against whatever charges were flagged as questionable by any other custom-
ers in its community.
Other examples of businesses using data for context include Glass-
door, which lets job seekers compare their salaries with averages for 
others in their industry and role, and Pricing Engine, which helps small 
businesses improve their digital advertising spending (on platforms like 
Google AdWords) by comparing their own success rates with those of 
their peers.

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Tool: The Data Value Generator
We’ve looked now at the different types of data being used in business 
today. We’ve examined the sources where businesses can find more data 
to fill in their own gaps. And we’ve seen four templates for generating new 
value using customer data. Let’s look now at how to apply these concepts to 
generate new strategic options for data initiatives in your own organization. 
That is the focus of our next tool, the Data Value Generator.
The tool follows a five-step process for generating new strategic ideas 
for data (see figure 4.1). Let’s look at each of the steps in detail.
Step 1: Area of Impact and Key Performance Indicators
The first step is to define the area of your business you are seeking to 
impact or improve through a new data initiative. You might define it 
as a specific business unit (e.g., product line), a division (e.g., market-
ing), or a new venture. You might decide that you are looking to apply 
data to improve customer service at a resort, to develop better product 
Figure 4.1 
The Data Value Generator.