By Zoha Peerbhoy | May 2025
We have come a long way from what personalization strategies looked like a few years ago. We would receive communication from brands where they used our first name in an email and recommended products based on past purchases.
Nowadays, however, with the help of AI and algorithms, businesses can predict our next move before we make it. It’s no longer enough to receive recommendations based on past data. Customer experience can no longer be one size fits all. Customers are now informed about how data is collected and used for marketing and recommendations, so they expect brand interactions to feel more customized and intuitive.
What Is Hyper-Personalization, Really?
Hyper-personalization goes beyond demographic segmentation or basic product recommendations. It’s the ability to use real-time data, AI, behavioral signals, and emotional context to create highly relevant experiences that appear custom-made.
According to a recent study by Raiyan Haider and team (2025), published in the International Journal of Science and Research Archive, hyper-personalization involves a sophisticated orchestration of tools, AI-powered analytics, behavioral pattern recognition, emotional tracking, and predictive modeling, to tailor each moment of interaction with precision.
In essence, this approach goes beyond personalization and embodies precision marketing on a large scale.
Why One-Size-Fits-All CX No Longer Works
Imagine that you buy a jacket during the winter, and next year, at the same time around, you’ve received a 10% coupon for winter jackets. It could be the case that you do not want another jacket this time around, so you ignore the offer.
On the other hand, imagine that you have recently looked up walking pads several times in the past two weeks. You may have even wishlisted one or put one in your cart but haven’t bought it yet. This generally indicates that you’re still unsure about the purchase, or it may currently be out of your budget. Receiving an email or message about a limited offer on walking pads could help you decide to go ahead and buy it after all, because it’s on sale.
According to an article by Salesforce, 73% of customers expect companies to understand their unique needs and expectations, and 80% believe that the experience they provide is as important as their products and services.
This shows how important personalized experiences are for customers, particularly in a world of endless choices and instant gratification. Brands that do not provide personalized suggestions could risk falling behind.
However, it goes beyond just personalization. According to Shruti Jadhav, Vice President and Principal Analyst at QKS Group, “Hyper-personalization is not just about tailoring messages but it’s about orchestrating moments. From awareness to advocacy, the most forward-looking CX leaders are leveraging customer data, behavioral signals, and predictive intent to shape entire journeys, not just touchpoints.”
Brands That Are Getting It Right
1. Netflix
Netflix has taken remarkable strides in providing a hyper-personal experience. Its recommendation engine tracks the shows and movies you watch, as well as when and how often you consume content. It then dynamically generates thumbnails based on your behavior.
2. Spotify
Spotify offers a range of playlists based on your preferences, including mood-based and workout-driven playlists. It also takes into consideration the time, device type, and weather conditions.
3. Sephora
Sephora effectively uses AR and AI to deliver tailored product recommendations, based on purchase history, skin tone, and even your current mood through facial recognition.
These businesses are focusing on providing superior hyper-personalization, narrowing down recommendations based on preferences.
The Tech Stack Behind the Magic
Providing hyper-personalized CX involves a range of tools to actually be effective. It’s the product of a well-integrated Martech stack, including:
- Customer Data Platforms (CDPs) to unify identities across devices and sessions
- Real-time analytics engines for moment-by-moment decisioning
- Generative AI for creating dynamic content (emails, web pages, offers)
- Emotional AI to understand sentiment and mood
- Data governance frameworks to ensure privacy and compliance
But It’s Not All Smooth Sailing
The Personalization Paradox
Customers are becoming more aware of how their data is used and are making more of an effort to understand the implications. However, many continue to consider it highly intrusive. Businesses can reassure customers by being transparent about how they use their data and only providing personalized recommendations in a way that’s useful, and not overly invasive.
Ethical and Regulatory Risks
To safeguard customer privacy, regulations like GDPR and CPRA have been put in place. Brands must hence be careful to always offer transparency and consent, avoid using data about health, income, or identity unless explicitly allowed, and use responsible AI models with explainability.
The Road Ahead: AI Agents That Curate CX
The most forward-looking brands aren’t just building dashboards. They’re building autonomous AI agents, systems that learn, predict, and act on behalf of the customer.
Think about:
- Travel agents that book your flight before you even know you need it
- Smart retail bots that adjust inventory or offer based on real-time social chatter
- Virtual health coaches who intervene based on biometric cues
This new wave of “agentic AI” will push hyper-personalization into proactive, self-evolving CX. The brands that win will treat CX like an operating system, not a function.
Final Take: Getting Personal is the Way Forward
In 2025, one-size-fits-all is no longer a suitable approach to drive customer engagement. Businesses should learn how to better use collected data to provide a better customer experience. Hyper-personalization is the new baseline for more meaningful CX. However, it goes beyond clever targeting and needs more data integrity and ethical frameworks to improve customer trust. Customers should feel like their experience is tailor-made for them, and not just based on what’s currently trending.