Personalized marketing has completely revamped the digital marketing sphere in recent years. With online ads becoming such a ubiquitous part of the digital experience, consumers have started to tune out more generic content intended to reach as wide of an audience as possible. Companies are beginning to realize they’re more likely to see success fine-tuning their marketing channels to create a highly personalized customer experience.
Big brands use personalized marketing all the time. Amazon, for example, caters product suggestions on their home pages to the interests of individual users. If Netflix notices a customer likes a particular actor, they’ll more frequently show that customer film covers featuring him or her. This does not just increase sales and foster lasting relationships with customers. It’s a better browsing experience overall.
Developing a personalized marketing strategy is a wise decision for a number reasons. Not only do personalized campaigns have a proven track record of increasing sales and conversions, they have more subtle benefits as well. Successful personalization helps you develop a stronger relationship with your customers, strengthening your brand. This can translate to long-term, sustainable growth.
How Does Personalized Marketing Work
Personalized content is about more than just sending an email using a customer’s first name, although this can certainly help. Personalized marketing is a long process done by analyzing data about your customers.
Data can include everything from pages a user visits to ads they click to outside interests related to your company or services.
Personalized marketing can be broken down into four steps:
- Identify: This is the data collection stage, where your goal is to learn about your customer. This includes things like their gender, age, and location as well as shopping habits and interests.
- Differentiate: Analyze the information you learned and categorize customers into the niches you’re looking to target.
- Interact: This is where you start reaching out to customers through mediums they’re most likely to respond to such as social media or email.
- Customize: As you start to make contact with customers, you can personalize the user experience and ultimately close the deal.
Personalized marketing means more than showing consumers relevant products. It means creating a highly individual experience.
What Are The Benefits Of Personalized Marketing?
Anyone who has spent any amount of time online knows that, after a certain point, you start to tune out ads. Not only are mass ads ineffective at gaining a customer’s attention, they may also create hostility. Some studies show 63% of consumers find mass ads annoying. The last thing you want is for customers to associate your brand with negative feelings.
With personalized marketing, you can provide users with relevant content based on past behavior. Customers see the value in accurate advertising as it directs them to potentially useful information rather than inundating them with superfluous advertising. The benefits of this are twofold. First, customers are more likely to buy products or services beneficial to them. Second, it leaves customers with a better impression of your company as you are directing them toward useful content.
Building Customer Relationships
Personalized marketing is about more than a one-off sale. It’s about creating repeat, long-term customers who have good things to say about your company. Personalized marketing can help you foster strong, sustainable customer relationships. Knowing personal information about your customers is an invaluable means of showing them gratitude.
This helps show the human side of your business. A constant influx of ads starts to feel cold and anonymous to most people after a certain point. A small personal touch can go a long way in helping your company stand out.
Anticipate Customer Needs
If you anticipate what your customers need in the future, this can help you offer more precise suggestions, increasing the likelihood of future purchases. Suggested products have a high engagement potential when you’re showing your customers something very precise. This means using what you know about a prospective customer to make educated guesses about future purchasing decisions.
For example, maybe a customer has just bought a set of weights and has been looking at a lot of content related to health and fitness. What would they need in the future?
You could suggest related workout products, like resistance bands, or products like protein powder. Maybe this customer has also taken up running to add cardio to their workout routine. Try sending them ads for good gym shoes or workout outfits.
Boost Sales and Conversions
Personalized marketing has a long track record of increasing both sales and conversions considerably. The above benefits all encourage prospective customers to not only make a purchase, but to come back to your company again and again.
Marketers say that on average they see a 20% increase in sales when they use personalized experiences. Customers, in turn, largely confirm they appreciate the effort. When it comes to ecommerce, 59% of customers say personalized marketing influences their decisions and 31% say they wish online shopping was more personalized.
What Common Outlets Help With Personalized Marketing?
Facebook is one of the best outlets for personalized marketing due to its customer-centric targeting tools. Tools like Facebook IQ, Audience Insights, and the Audience Selection tool allow for incredible precision when creating ads for a specific person or audience. Location, interests, location, and demographics can all help you fine-tune your ads.
Facebook allows you not only to identify audiences interested in your products, but to create copy directed at specific needs, pain points, and aspirations – tactics that can encourage people to be more receptive to advertisements.
Facebook is also a good platform for re-targeted ads. If someone previously clicked on an ad, you can send them a re-tooled one later on. For example, say someone clicks an ad regarding a shoe sale at your business. Try sending them an ad later on with a tagline such as, “Time is running out to save!”
Google also offers user data that can help you tailor ads to a specific audience. Google collects information about people’s interests, ages, locations, and more and breaks down user data into broad interest categories and also factors like location and age. This information can then be used by advertisers to create ads targeted at hyper-specific audiences.
Google allows advertisers to use multiple forms of targeting. Demographic targeting can help you identify people based on information like location, age, and gender. Interest targeting can help you find customers who would potentially be interested in your product or service based on their web history.
Instagram is one of the best platforms for creative personalized marketing. People tend to share a lot of personal content on Instagram, so it is a good outlet to foster a deeper connection with your customers. You can gauge people’s values via their behavioral activity on the app and create highly personalized content to match.
Instagram allows brands to create not just pictures and copy, but ad campaigns that appeal to customers in innovative ways. Instagram gives you a chance to show your deeper values and personality, which can bolster positive customer relationships.
One good example of highly personalized marketing on Instagram is John Frieda, a company that sells salon hair products. Through the #ShadesofMe Instagram campaign, they allowed fans to visit their campaign page, connecta via Instagram, and select their natural hair color. They then used an algorithm to compare customers’ hair colors to the most popular colors in their own Instagram posts and used that data to build videos for users describing how color reflects their personality.
LinkedIn’s Dynamic Ads platform allows you to build personalized content customized to your marketing objectives. It is an important means to building brand awareness through highly targeted messages, which familiarizes your business to a relevant audience.
Dynamic Ads allows you to create personalized ads featuring professional’s own LinkedIn profile data, including things like their age, company name, job title, and more. They also offer convenient templates you can use to create and then run your ads, as well as a “Campaign Manager” feature which allows you to measure results and performance.
Are There Any Privacy Concerns?
When creating personalized marketing campaigns, there is a fine line between appealing and uncomfortable. With more and more concerns about data harvesting and privacy online, some users feel understandably unsettled if content becomes personal to the point it feels like an invasion of privacy. There are multiple ways to mitigate these concerns.
First, stay away from sensitive information. Targeted ads should never revolve around factors like health conditions, sexual orientation, or other deeply personal matters.
Second, be transparent with customers. Marketers should provide information about their data use on request, such as an AdChoice icon that customers can click to see why they are seeing a particular ad.
Third, use only relevant data to target customers. For example, data can provide information about customers’ clothing sizes or weight. This may be useful to include in ads for weight loss products or fashion, but would obviously not be wise to use when selling unrelated products.
In general, customers do respond well to personalized ads that appeal to their broad interests without using potentially sensitive information.
The Bottom Line
Personalized marketing is reshaping the way businesses interact with their customers. Wide-reaching ads often cast a very wide net only to reach a scant few customers. While creating a catered experience for individual consumers takes a great deal more time and effort, it pays off much more in the long run than more traditional tactics.
The ability to relate to a customer personally is vital to standing out in the marketplace. This is especially true as more and more purchases are happening online. Customers have access to innumerable options these days. Approaching customers with empathy and gratitude and directing them to relevant products and services will help you stand out.
Personalized marketing goes well beyond making a sale. It’s about leaving customers with a positive impression of your company by putting in the extra effort necessary to make them feel appreciated. Even if a customer does not make a sale the first time they visit your site, providing them with a great user experience will incentivize them to return. A good personalized marketing strategy will almost always pay off in the long run.
Need some help? At LookinLA, we build data-driven marketing strategies for clients to help them become industry leaders. We have experience working with a diverse range of clients. You can read success stories here and reach out to book a call here to talk. We look forward to hearing from you.