With the technological advancements we are continuously seeing in the digital advertising industry, more and more marketers are clamoring to grasp the opportunity to take personalization to the next level. It’s difficult for large brands and small businesses alike because of how much work it takes to effectively monitor, define, and ensure personalized marketing effectiveness. Still, with a basic understanding of what this entails and some planning tools at their disposal, companies can get on their way towards generating higher engagement with consumers through personalization.
What is personalized marketing?
Now the question remains as to what is personalized marketing. Personalized marketing has gone much more beyond just inserting a customer’s name into mass emails that are delivered. The personalized marketing definition could be explained as the following – curating your marketing based on information that you have collected from your customers such as purchase history, interests, shopping preferences, spending habits, etc. to create customized content for those same customers. It is about sending the right message to the right person at the right time.
Why choose personalized marketing?
Customer experience plays a much larger role in a customer’s decision making process than it once did. In fact, according to report by Mckinsey & Company, 71% of consumers expect companies to deliver personalized interactions and 76% get frustrated when this does not happen. The same report found that “companies that excel at personalization generate 40 percent more revenue from those activities than average players”. This has in part to do with the rise in online shopping due to the global pandemic. With the abundance of options available to consumers in the online marketplace, consumers want a brand that will stand out to them and make an effort to put them first. This is where omnichannel also comes into play.
In short, omnichannel marketing involves a brand going to the customer instead of a customer trying to reach the brand. As previously mentioned, with the growing online presence of both consumers and brands, many brands have multiple platforms such as an online website, Instagram, and other social media platforms. In order to achieve effective personalization, all these channels must be working together in order to achieve success. Customers are actually much more likely to stop buying from a business if they cannot seamlessly switch between channels according to a 2021 report by Vonage.
Personalized Marketing Benefits
- Improves overall customer experience
- Increases customer loyalty
- Builds customer relationships
- Improves email engagement
- Plays an essential factor in company growth
- Influences buying behavior across the customer life cycle (Mckinsey & Company)
- Often drives 10 to 15% revenue lift (Mckinsey & Company)
- Prompts consideration of a brand
Over three-quarters of consumers (76 percent) said that receiving personalized communications was a key factor in prompting their consideration of a brand
McKinsey & Company
Personalized Marketing Tips
It is essential to choose the right approach for your personalization strategy to occur for both your business and your customers. One of the most critical aspects of this strategy being timing and ensuring that in an effort to provide personalization you do not come off as intrusive. Many feel that personalization should only take place once a potential customer has purposefully provided information to the company, while other companies uses anonymous data to guide them in the right direction.
Different approaches seem to work in different situations. Here are a few tips to help you choose and implement the right approach for your business.
What are the best ways to create a Personalized marketing Strategy?
- Know Your Audience – Once you have decided that a personalized strategy is right for your business, the next step is identifying who you want to target. This will depend largely on what demographic you are trying to reach and if there are any geographic or other distinctive features of your audience that can be taken into account. If possible, try using behavioral targeting with tools such as Google Analytics; this will allow you to learn more about who makes up your audience so that you can better personalize your approach for them.
- Make Meaningful Connections – Creating conversations with the customers allows customers to see the human aspect behind a brand making them more likely to purchase from a brand and greatly improve your customer relationships making customers more likely to make repeat purchases.
- Customization vs. Personalization – Customization is done by the user while personalization is done for the user. Customization uses preferences that users have identified themselves while personalization uses data a brand has collected itself to post relevant content. Personalized marketing involves using customer preferences obtained from online behavioral information or past purchase history or other sources which are then applied when displaying content online.
Personalized Marketing Examples
Some personalized marketing examples are Groupon, Amazon, and Sephora.
Personalized marketing has become a huge part of the digital marketing industry but also a difficult challenge for marketers to tackle. This is due to the amount of data that is required for marketers to view individual consumers through personalization. In addition, with personalization now being used as a larger part of advertising and branding, it is vital for brands to use detailed segmentation in order to achieve the desired results. With the correct approach and tools, personalization at scale becomes possible.