The State of Personalization

By Lisa Whetstone

When it comes to marketing and advertising efforts, the world of personalization is constantly evolving. There are new regulations regarding data privacy and new strategies are evolving to increase the accuracy and impact of personalization efforts. Resultantly, many brands must start approaching their personalization strategies differently.

Using Personalization to Outsell Competitors

Brands that apply personalization to their activities will outperform competitors. Gartner states that in 2018 organizations that fully invest in all types of online personalization will outsell companies that have not by 30%. It’s more than just online personalization we must consider though. Gartner also defines personalization as a process that applies context, such as knowledge about users and their circumstances, to tailor and deliver messaging, content, offers, and other forms of customer interactions through digital channels to improve marketing and business results.

What makes something personalized usually comes down to whether a relevant interaction is taking place with the right customer in the right channel with the right message at the right time. The purpose of personalization is to engage with customers to increases their satisfaction and drives brand loyalty. However, there are obstacles to achieving personalization.

The Challenges

First, brands need to change the way they think. Brands can’t think of personalization as a way to gain power over consumers. In fact, there has been a transition of power from brands to consumers—small businesses understand this, evidenced by a $22 billion shift in industry sales from large to small companies, reported by IRI. Just look at a brand like Dollar Shave Club that grew tremendously through very successful personalization techniques.

Brands also need the right tools. This is incredibly difficult with the overwhelming variety of solutions available. Thinking through the overall strategy and how personalization applies to your customer journey helps. Keep in mind, the consumer landscape is constantly changing—agile solutions are critical to stay ahead of consumers and continue evolving personalization tactics.

Further, in pursuit of personalization, brands often fail to identify the right consumers to target. Within that, they may not fully understand what motivates and influences their behavior. It’s difficult to identify the right consumers and even more challenging to gather accurate data on them. It’s critical to use primary data sources and avoid decision-making based on secondary research or industry hearsay.

There are also data regulations posing new challenges. Specifically, when it comes to personalization, new privacy regulations will make it harder to gather consumer data. Brands must find solutions that gather robust sets of consumer data without infringing on these policies. These challenges are more than just obstacles—they’re redefining processes.

The Changing Landscape

According to Forrester, 89% of digital professionals are prioritizing investment for personalizing the customer experience. In part because 61% of consumers said they are unlikely to return to a website that does not provide a satisfactory customer experience. Also because of the ROI personalization strategies can provide.

Moving beyond the digital realm, many brands are coordinating an omnichannel personalization approach and expanding their efforts within those channels. Many strategies and solutions can build layers of personalization between in-store ads, emails, their website, and media.

There’s also been a realization that audiences are shrinking, and the initial success of a product or service is driven by a smaller subset of the population—the whole premise behind personalization. Catalina reported that 1.5% of shoppers decide the success of new CPG products within the first 12 months. Other industries can relate to this as well.

So, if the end goal is increased customer satisfaction and brand loyalty, why aren’t we organizing our personalization strategies around the people who drive the market the most? We need to quit solely testing products and processes against norms or benchmarks and focus on understanding unique audiences.

Personalization should start earlier on—many strategies are focused on in-market tactics. Yet, personalizing pre-launch means the consumer’s needs are taken into consideration first, and products and communications are optimized with them in mind earlier on. Insights can then be applied throughout the entire process from exploration to development to communication and activation. Approaching personalization like this will increase product launch success, brand relevance, ad effectiveness, and ultimately customer satisfaction and brand loyalty.

Lisa Whetstone, VP of Marketing, GutCheck,

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