Marketing Glossary / Marketing Personalization
Marketing Personalization
Marketing would be easier if every customer behaved the same. In the real world, however, every customer is unique, and customers are often broken into groups focused on different benefits or challenges. The more a company is able to personalize its marketing to reach key segments, or even individual customers, the more successful the marketing will be.
This guide will explain what personalization is, how it works, the benefits of personalization, and how companies can leverage personalization to increase conversions.
What Is Personalization?
Personalization tailors marketing to customers' unique behaviors, preferences, actions, and history.
The goal of personalization is to deliver relevant messages and offers to every customer by understanding their unique profile and behaviors and predicting their needs. This takes many forms like personalized emails, targeted advertisements, customized website experiences, and individualized product recommendations.
In some instances, the value of personalization comes simply from getting the right offers in front of the right customers. In others, personalization can make customers feel specifically recognized and catered to, leading to increased loyalty and higher revenue.
How Does Personalization Work?
Collecting The Right Personalization Data
Every customer is a unique individual with a wide variety of interests, behaviors, and preferences. The majority of those interests, behaviors, and preferences are irrelevant to the company attempting to create personalized marketing.
A major personalization challenge is identifying the customer attributes that make the most impact.
For example, a software-as-a-service (SaaS) company specializing in project management tools might identify key data points such as a customer's feature usage rate, team size, and usage growth pattern.
If a customer often uses collaborative features and leads an expanding team, the company could tailor communications to emphasize advanced collaboration, new team management tools, or training to scale their operations efficiently.
Knowing the right data to zero in on helps businesses to leverage the best messaging possible to their customers.
Web Analytics
Tools like Google Analytics track user behavior on a website including pages visited, time spent on pages, bounce rates, and the paths taken through the site. This data helps businesses understand which parts of a website are engaging customers or need improvement.
CRM Systems
Customer Relationship Management (CRM) systems collect and manage customer interactions across all touchpoints, including email, social media, and customer service calls. This data provides a comprehensive view of the customer journey and their preferences.
Transactional Data
Sales data, including frequency, recency, and monetary value of purchases, help segment customers based on their buying behavior and predict future purchases.
Customer Feedback
Surveys, reviews, and feedback forms give businesses direct insight into customer satisfaction and preferences. This qualitative data is crucial for understanding another side of the customer experience.
These methods cover the majority of the customer journey for most businesses but there are numerous other options available for specialized customer journeys and business models.
Create Personalized Messaging at Scale
Marketers often focus too narrowly on messaging's personalized components. Personalization enhances the message's impact, but effective messaging hinges on strong copywriting and marketing. It involves crafting a series of messages and experiences tailored to each customer segment.
This is where we arrive at a core challenge of personalization: scale. How many customer segments are being targeted? The smallest answer is two, and that still potentially represents double the total messaging needed from not having any segments at all. Increase that to four segments and four times the copy is required.
In some cases, similar messaging can be replicated across every segment. This is why it's important to understand the difference between “good messaging” and “personalized messaging.” Including the most effective messaging across four different customer segments may only require a 5% adjustment to the copywriting.
Regardless, it’s important to focus on the following things:
- The customer’s needs and values.
- Deliver the right message at the right time in the customer journey.
- Deliver consistent messaging across every customer touch point.
- Address the personalized data points for that segment in a meaningful way.
Remember that marketing messages are never delivered in isolation. Each message is a single touch point on a longer customer journey.
Tools For Creating Personalized Messaging
Customer Data Platforms (CDPs):
CDPs integrate data from multiple sources to create a single customer profile that can be used to automate personalized messaging. They help in segmenting the audience based on behavior, demographics, and other custom attributes.
Content Management Systems (CMS) with Personalization Features:
Modern CMSs offer dynamic content personalization, allowing websites to display content tailored to a visitor's profile or past behavior.
Dynamic Ad Platforms:
These platforms enable the creation and management of dynamic ads that change content according to who is viewing them based on real-time data.
Artificial Intelligence Tools:
Recent developments in AI have created new possibilities for personalized messaging—opening up affordable single-customer personalization as a new possibility. AI is able to both identify customer behavior patterns and create custom messaging that can adapt to real-time information.
Emails
Subject lines, greetings, content, and product recommendations can be based on the recipient's past behavior, demographics, and purchase history.
Websites
Dynamic content such as banners, product recommendations, and even the layout can change based on the visitor's profile, location, device used, and browsing history.
Ads
Online ads can be personalized to display products or services a customer has previously viewed or to target specific segments with tailored messaging.
Search
Personalized search results based on user behavior, preferences, and previous interactions make it easier for customers to find relevant products or information.
Product recommendations
Products can be suggested based on a customer’s browsing and purchasing history— similarly to how Amazon personalizes the shopping experience.
Content
Blog posts, videos, images, and other content can be customized to appeal to different segments or even individual users.
Offers and promotions
Discounts, coupons, and special offers can be tailored to individual consumer habits, loyalty status, or likelihood to purchase.
Customer service
Personale customer support by providing agents with a complete view of a customer's interaction history to ensure a better, more informed interaction.
Social media
Tailor social media posts and interactions based on user behavior and engagement with the brand.
Mobile apps
Notifications and app content can have specific information based on the user's engagement, location, and usage patterns.
Chatbots
Program chatbots to deliver personalized messages and responses based on the user's past interactions and queries.
Shopping carts and checkouts
Personalize the checkout experience with saved preferences, addresses, and payment methods to streamline the buying process.
Messaging and SMS
Text messages can be personalized with the customer's name, past purchases, and other relevant information to encourage immediate action.
Direct mail
Traditional direct mail can use variable data printing technology to include the recipient's name, personalized URLs (PURLs), and tailored content.
While many of these elements wouldn’t have been cost-effective to personalize over the last few decades, recent AI developments are having a large impact on what can be personalized.
The Benefits Of Personalization In Marketing
- Increased engagement: Personalized content is more relevant to a consumer, and that may lead to higher engagement rates. Engagement may come in the form of increased time spent on a website, higher email open rates, and more interaction with the brand.
- Enhanced customer experience: Tailoring marketing to individual needs and preferences boosts convenience and enjoyment.
- Higher conversion rates: Calls-to-action (CTA) and brand offers are more effective when personalized. This can help improve conversion rates from leads to sales.
- Improved customer loyalty: Customers are more likely to make repeat purchases from a brand that understands their preferences and provides them with relevant options. Personalized experiences help foster a sense of loyalty and trust in a brand.
- Better customer insights: The data collected through personalization efforts can provide valuable insights into customer behavior, preferences, and trends, which can inform future marketing strategies and product development.
- Increased revenue: With more targeted marketing efforts, businesses may see an increase in up-sell and cross-sell opportunities, leading to increased average order value (AOV) and overall revenue.
- Efficiency in marketing spend: By focusing on segments more likely to convert, companies can allocate their marketing budgets more efficiently, reducing waste on broad, untargeted marketing campaigns.
- Competitive advantage: Personalization can be a key differentiator in markets where competitors are offering similar products or services. It allows a brand to stand out by offering a unique customer experience.
- Streamlined sales process: Sales teams are able to use personalization data to better understand their prospects, and tailor their pitches accordingly to close deals faster.
- Reduced customer churn: Personalization helps anticipate customer needs and solve problems before they arise, which can help reduce the rate at which customers stop using a service or switch to a competitor.
Implementing marketing personalization requires a strategic approach. It needs to be mindful of privacy concerns and must be based on accurate data. When executed well, this tactic can significantly strengthen the relationship between a brand and its customers.
How Can Ads Be Personalized?
Retargeting: Ads are personalized based on a user's previous online activities, such as visiting a website or viewing specific products. For instance, after a user leaves an e-commerce site, they may see ads for the products they viewed or added to their cart as they browse other parts of the web.
Dynamic creative optimization (DCO): This technology uses real-time data to create targeted, specific ads that change based on who is viewing them. It can adjust the imagery, messaging, or calls to action within an ad to match the viewer's interests, demographics, or past behavior.
LinkedIn Ads allow companies to run dynamic ads like the one featured below:
Lookalike audiences: Social media and search engine ad platforms allow advertisers to target new users who have similar characteristics to their existing customers—effectively personalizing ads to appeal to these new but similar audience members.
Contextual targeting: Ads are personalized based on the content of the web page or the type of content the user typically consumes. For example, a brand for running shoes has ads on sports-related articles or blogs.
Geo-targeting and geo-fencing: Ads may be personalized based on the user's location. For instance, a restaurant might show lunch specials to users within a certain distance during lunch hours.
CRM data integration: CRM data integration allows for personalization based on a customer’s history with a brand. Ads can include items related to past purchases, loyalty program statuses, or abandoned cart items.
Interactive ads: Ads with interactive elements like quizzes or polls can adapt content based on the user's choices, creating a personalized path through the ad experience.
By leveraging these methods, advertisers can significantly increase the relevance and effectiveness of their ads, leading to higher engagement rates, better conversion rates, and ultimately, a stronger return on investment for their advertising efforts.
Leverage Personalization With LinkedIn Ads
Here are some of the ways companies are leveraging LinkedIn Ads for personalization:
Segmented ad campaigns: Use LinkedIn's detailed targeting options to create segmented campaigns. Tailor your message to resonate with each specific segment, whether it's based on industry, job function, or seniority level.
Dynamic ads: Use LinkedIn's dynamic ad capabilities to personalize ad content in real-time. These ads display user-specific information like name, company, and job title, making them more relevant and engaging.
Retargeting: Implement retargeting strategies on LinkedIn to re-engage visitors who have interacted with your website or LinkedIn content. This ensures continuity in your marketing efforts and keeps your brand top-of-mind.