What Is Personalized Marketing and How to Do It the Right Way?

Shikha Tyagi Shikha Tyagi
May 4, 2022 8 min read
What Is Personalized Marketing and How to Do It the Right Way?

Personalized marketing means customizing your marketing strategy as per the need and convenience of your customer. This is also known as one-to-one marketing. The information about the customers is collected from different sources. This is used to make their user experience better.

Imagine you went to visit a relative and they exactly remember your likes and dislikes. They serve your favourite food and only talk about the topics of your interest. Wouldn’t you feel close to them? You might even want to visit them more often.

This is the basic formula for personalized marketing. So, if you were thinking that personalized marketing is just adding the first name of the customer to the subject line of your email, think again. Here is everything you need to know about personalized marketing

Benefits of Personalized Marketing
Challenges of Personalized Marketing
How to Create a Successful Personalized Marketing Strategy?
Examples of Personalized Marketing

Benefits of Personalized Marketing

An online survey was conducted by Epsilon, in 2017, on a group of 1000 people. As per this survey, 90% of customers find personalization appealing. Further, 80% of the customers claim that they are more likely to buy products from companies that offer a personalized experience.

Today, more and more companies are shifting to personalized marketing. The reason for this is the immense benefits for both customers and businesses. Some of the benefits of personalized marketing are:

Better Customer Experience

No customer wants to know the details of all your products. If someone is looking for watches, there is no point in displaying sunglasses. If a customer feels you are only trying to sell your products there is a high probability they will leave for good.

Personalized marketing helps improve the customer experience by predicting and providing them with the options of their choice. It creates suggestions based on the earlier searches of the customer.

This makes the customer believe that you understand their needs and not just advertise your products. Hence, it builds a trusted relationship between the brand and the customer.

Enhanced Customer Loyalty

According to Customer Retention Statistics, the probability of a company selling its products to existing customers is 60-70%. This makes customer loyalty quite important.

When a customer provides information, in return they expect the company to treat them with attention. So, if you send them a personalized list of products based on their unique preferences, you might have a customer for life.

Increased Return on Investment

Personalized marketing can be a very cost-effective strategy. There are multiple channels available to reach the customer viz. emails, calls, text messages, etc. By using the right kind of automation technique a company can identify the preferred channel of communication for every customer. This way the customers engage better with the brand. The customer can then be followed on other channels using the omnichannel approach.

Challenges of Personalized Marketing

According to a survey conducted in 2019, almost two-thirds of the marketing influencers identified personalized marketing as the most difficult strategy to execute.

Some of the challenges associated with this form of marketing strategy are described below:

Striking the Right Balance:

Personalized marketing is an amazing approach until used excessively. The customer should not feel stalked. It is important to provide the right suggestions, at the right time.

In a global poll conducted by Marketo, nearly 63% of the customers said they were annoyed with excessive, irrelevant, and repeatable advertisements from the companies. Therefore, the balance has to be maintained between providing valuable personalized content to your customer and forced advertisement.

Gathering Customer Data:

Providing an experience tailored to the need of particular customers requires knowledge of their interests. This would help you to predict the options of their choice. There are two main channels to gather this information.

The first is analytics. This relies on tracking the customer’s activities while they are on the site. However, this is seen to make some customers uncomfortable. It might appear creepy for some people to see the advertisement for their recently viewed products.

The other channel is surveying. Here, the customers can themselves provide the information about what are they seeking. However, whether the customers will actually participate in these surveys usually depends on their length and objectivity.

The multiple questions surveys requiring long answers are usually skipped by the customers. Hence, the information has to be drawn cautiously without freaking out the customers. Equilibrium between transparency and convenience has to be maintained.

Finding the Right Resources:

An effective personalized marketing strategy requires advanced technology and efficient teamwork. Automation and data collection are the key ingredients of personalized marketing. This poses the need for advanced software and technology.

Similarly, a dedicated team ready to devote time and efforts to make a personalized marketing plan work is equally important. The software collects data while the team decides the use of that data. This cannot be achieved using mere algorithms. A team plans and tracks the use of resources.

Consistency Across Channels:

Brands interact with their customers using multiple channels. To match the app experience with the in-store experience, it is important to maintain consistency between these channels.

The customer’s needs and demands can be well identified by tracing common threads across all these channels. This information can be compiled to form a unique customer profile.

Although most marketers find it difficult to create a link between data and customer profiles, once done it becomes an extremely important resource. This helps generate the content of interest for the customer and increases the possibility of response. Moreover, it also helps anticipate the future needs of that customer.

Areas to Use Personalization to Improve Customer Experience
Areas to Use Personalization to Improve Customer Experience

How to Create a Successful Personalized Marketing Strategy?

Creating a successful personalized marketing strategy can be tricky. However, there are simple things that you can do to make your plan work.

Content Personalization Engine:

If you are not using this yet, it is better to get one. It can help you in more ways than you can imagine. Also, if you are already using it, try comparing it with other available options to keep your business growing.

Capturing Data:

It is important to have information about the browsing history of your customer if you really wish to reach them personally. Adding a few lines of code to your website will solve the purpose. You can track the purchase history, time spent on site, number of clicks, etc. This will help you to correctly predict the response of a customer towards certain products.

However, it is equally important to respect the privacy of your customers and not appear creepy. To build a strong relationship with your customers, they must see you as a responsible brand that cares for their needs and respects their privacy.

Do provide a disclaimer about how you are using the customer data. Further, providing the customers with an option to opt-out at any stage makes them trust you more.

Segment Your Audience:

Having the data is the first step. Post that, this data has to be analyzed to segment your audience. This can be done based on spending levels, buying patterns, products of interest, etc. Thereafter, you can choose the most relevant segments for your brand. This will help you build an adaptable website beneficial for your brand as well as customers.

Choose Your Platform:

After segmenting your customers based on different criteria, you will have to choose the platform best suitable to reach them. There are a number of platforms such as emails, remarketing ads, etc.

Your data becomes valuable if you can use it to create a personalized solution by providing relevant content to your customers. However, your content is only valuable if the customer actually notices it. Therefore, it is important that you reach your customers through the channel of their choice with the information of their interest.

Examples of Personalized Marketing

Some brands have taken personalized marketing to a whole new level. In this section, we will discuss the strategies of five such brands.

Shutterfly

It is an app and a website that assists you in creating customized photo books, calendars, etc. You can create items with your photos laminated on them. The company had already been sending personalized emails and notifications to its customers. However, recently they added another feature to their phone app.

Once you allow the app to access your photo gallery, it automatically identifies your face in the photographs. It then pastes these photos on the items of your choice available on the app. Later, it sends recommendations for you to buy those items.

Amazon

The product curation and recommendation algorithm used by Amazon has been appreciated since the beginning. It does not just remember the product of your choice but also your size, colour preferences, etc. This makes shopping with Amazon a great experience for users.

amazon Personalized Recommendations
Amazon Personalized Recommendations

Amazon has mastered a super-innovative technology that is proactive and provides data-driven recommendations. No wonder customers connect to this brand so well.

Spotify

Almost all the music apps provide you with automated music recommendations. However, Spotify’s Discover Weekly service has taken this to another level. The quality of the picks is consistently good. The app seems to know its users way too well.

Spotify Personalized Recommendation's
Spotify Personalized Recommendations

The technology behind the app is from Echo Nest which was acquired in 2015. Using the algorithm, the app determines the musical taste of the user based on their listening behaviour. For example, if a user fast-forwards the song in less than 30 seconds, it is a thumbs-down. The app would then avoid notifications for that particular song or artist.

Iberia Airlines

The Company launched a campaign in 2016 where it sent emails to the customers asking certain questions. The questions included asking about your dream holiday destination and who would you like to go with. To answer these questions, customers had to fill in the details of the person they wanted to travel with like their name and email address.

The website would then send a holiday greeting card to that person telling them about your dream vacation. The website used cookies with the permission of users. So, the other person would see similar suggestions across the web.

Twiddy

As mentioned in the previous section, just having the data is not enough. You should be able to utilize it to its potential. Twiddy is a vacation rental company. It collected and analyzed the data looking for the week-to-week shift in rental volume and demand.

Based on this information, it sent recommendations to the homeowners regarding pricing. The information was both helpful and actionable. This helped the customers to set more realistic prices based on the demand. The final result included increased bookings and delighted customers.


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Conclusion

Devising a great personalized marketing strategy is easier said than done. Especially today when the market is full of competitors and customer demands are at their peak. However, we sincerely hope that the information and suggestions given in this blog will help you through the process.

FAQs

Why is personalized marketing important?

Personalized marketing has become an important criterion for customer satisfaction. The customers provide their personal details to the brand and in return, expect to be treated uniquely. It has now become the need of the hour for marketers to treat their customers with the attention they desire.

How to measure your personalized marketing strategies?

There are a number of ways you can use to gauge the effectiveness of your personalized marketing strategies. Tracking the customer response and creating intuitive reporting dashboards can be of great help. This information will help you identify both the strengths and weaknesses of your strategy.

How do you use marketing personalization?

Segment your customers, use targeted messaging, track the behaviour of customers on your website, retarget customers and send personalized emails are some of the ways you can use personalized marketing.

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