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Everyone wants to be treated like an individual and, as many companies know, this can lead to bountiful rewards when used in customer communications. This extends to the home shopping arena where repeat custom is crucial and offering the right products at the right price, coupled with the best possible service, is key. This means a smooth fulfilment process with a level of service that treats the customer as a valued individual.

Getting personal

Personalisation is already a key part of the online ordering process through software providers such as Net Perceptions, used by Amazon, Elucid and Zendor, whose product Recommender uses a customer's purchase history to recommend other products. You only have to go to Amazon's site to see how well these can work. Registered users are greeted by name, and products recommended based on past purchases. The more feedback given the more tailored it becomes.

But it doesn't have to end there. Companies are recognising that building relationships with customers can be carried right through to the point of delivery. And personalisation at the fulfilment end is starting to take off. Companies from Scotts of Stowe to The National Trust and online lingerie retailer Splendour are using what they know about the customer to tailor the packaging of their orders.

And with good reason, according to Andrew Wilson, founder of the Catalogue Consultancy. "The point of delivery is one of the best selling opportunities," he says. "Customers have their purchase in their hands, and should be very receptive at this point."

As well as personalising the invoice, advice note or letter which would go in with an order anyway, companies are increasingly targeting customers by including a well-chosen catalogue or product offer with the order. After all, with the power of a little customer information, there's no need to put generic inserts in a parcel. "Inserts can be flagged to go out with a specific product," says Steve Bolton, COO of fulfilment services specialist Zendor.

But while simple in theory, it's not proving to be that easy in practice, adds Bolton. In home shopping, where personalisation does take place, it's generally the broad-brush approach, targeting segments, not individuals. This is largely for cost reasons, says Steve Dole, director of fulfilment at DataForce. "A car manufacturer can afford to spend a few pounds on a high quality personalised brochure," he says. "But if you're selling books or CDs, the profit margin just isn't there."

The cost of implementing a system may well be prohibitive. It requires a certain amount of investment to get it right, which is arguably where the fulfilment provider comes in. But there's also the question of whether fulfilment firms are sufficiently geared up to provide this level of service.

Some might struggle. "To produce personalisation on site you're looking at potentially significant enhancements to a printing and processing capability," says Bolton. He believes it's do-able but that smaller fulfilment companies may find the initial costs of implementing the technology a major stumbling block.

Bigger operations may be better placed to provide high levels of personalisation. Third party specialists like Zendor, Prolog and iForce have the necessary technology - much of it self-built. IForce works with clients including John Lewis and Splendour, both of which have an online shop and use its own SMaRT system.

SMaRT is a warehouse and sales processing software which integrates all customer contact points with purchase history and processes orders. It also sends order confirmation and despatch emails integrating with the delivery company. "It's driven by the clients," explains Nigel Richards, divisional director of direct sales at iForce. "If a client wants to promote a supplementary item, we'll receive information that a customer has bought product 'A' so we can trigger that item to go too."

Prolog, fulfilment partner for companies such as Thorntons, uses Sanderson's Mailbrain product, which handles database marketing, telemarketing, mail order processing, stock control, credit card processing and mailsort discounts. It also ensures its warehouse staff have everything they need to ensure orders go out with all the necessary personalised and unpersonalised components.

Clearly there are fulfilment firms who are more than capable of providing the personal touch. Yet many companies are proving slow at moving forward. Apart from the costs, another major issue is the value companies put on the packaging of their products. "Companies need to view the package as a marketing opportunity," says Wilson.

Getting this message through is often an internal issue. Peter Hughes, MD of Amethyst Group, believes the problem often boils down to getting the marketing director and the logistics director thinking along the same lines. The logistics director wants to get the package out quickly and easily, whereas the marketing director wants to drive more revenue through repeat purchases so sees the benefit of personalised content. "What you need is someone to take the bigger view," he says. "But it rarely happens."

Despite this, the number of companies dipping their toes in the water is steadily increasing. Scotts of Stowe already targets the catalogues it sends out with orders to the individual, and both Hamley's and Splendour plan to do more personalisation next year.

Splendour sends out its catalogue with all orders but is also building up a customer database to enable it to become more targeted. "We get a lot of bounceback orders from the catalogue, but use our customer database for more targeted personalisation," explains Mark Pilkington, Splendour CEO.

For many mail and online order businesses, it's still early days, but with customer retention top of the agenda, many who aren't personalising packaging are seriously thinking about it. "Catalogue companies have to explore as many avenues as possible to build relationships," says Dara O'Malley, head of marketing for new business development at Littlewoods, and chairman of the DMA Catalogue and Home Shopping council. "And if someone orders from you, there's an opportunity with the parcel to do just that."

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