Personalised marketing: A primer
We are all familiar with marketing personalisation, even if we don’t think we are. Those emails you get that recommend products or services? On site content suggestions depending on what you have recently viewed? That is all marketing personalisation, and it works thanks to some innovative tech going on behind the scenes.
This is so prevalent online now, that it has become the expected norm. It is no longer enough to simply round up your latest offers and send them over to your customers. How do you know they will like them? Inevitably most of your customer base will not be attracted to all you have to offer, so it can be counterproductive to harass them with irrelevant sales or limited time deals that they never had any intention of purchasing anyway.
It is not just the B2C field that does this either. Many B2B enterprises have a stock pitch or message that is spewed out in the hope that someone listening actually needs one of the things you offer.
Although that may sound like old hat, you would be surprised at how many businesses still operate along those lines. It’s surprising because we are now used to the big companies leading the way with personalised content, recommendations and offers. Does Amazon ring any bells? Of course it does - we have all got those emails offering similar items because “you recently viewed this product”. And it would not be a stretch to assume that at some point you may have considered and even purchased some of these recommendations.
Why is it important?
Because it is so helpful, this kind of personalised marketing is not seen as negative at all. In fact, some people may even look forward to the latest offers and recommendations sent straight to their inbox from one of the world’s largest online retailers.
It is this extra layer that really defines the difference between personalised marketing and non-personalised. One speaks directly to the individual, the other does not. As if more was needed to back up the notion that personalised marketing is far better, it has definitely been proven to increase conversions.
After its joint venture switchover in 2011, Co-operative travel saw a 95% increase in visitors and a 217% increase in revenue once they started implementing personalisation on their website.
Similarly, BMW generated a further $500,000 in revenue by personalising text messages to their customers in the US, which boosted conversions by 30% The benefits of providing a personalised message the doesn’t interrupt the customer with useless information, but instead actually gives them what they want, is undeniable.
Customer retention is built on relationship and familiarity; two things that personalisation builds upon and improves. Put simply, personalisation will make your marketing useful. The sheer volume of content, products and services out there means that by providing a personalised message that is predictive rather than reactive, brands are able to provide a valuable message in a world of unnecessary noise.
Although most marketers are aware of personalisation, it is not always done properly. Combining effective personalisation across onsite content, emails, social and other brand touchpoints is difficult, but ultimately provides a better customer experience.
Who does it well?
One such example is the previously Amazon. Undoubtedly the king of online retailers (in the western world anyway – here is looking at you Alibaba), Amazon achieved their position not just through competitive pricing, but by fostering an environment that really focuses on the individual needs of their customers.
According to a recent survey by BloomReach, consumers still rate Amazon’s personalised service as better than any other ecommerce provider. In fact, 82% of 1000 consumers who were surveyed said that no other ecommerce platform came close to the service offered by Amazon.
However even with such compelling data, this does not always translate over to the corporate perception of personalisation. The same data from BloomReach showed that only 2% of brands thought personalised shopping experiences were the most important factor when consumers choose retailers, as opposed to 31% of consumers who felt personalisation was the main factor.
This disparity is shocking, as it does not accurately represent what consumers expect, instead many businesses are focused on what they think they want. Amazon overcame this by listening to their customers and further developing the things they said were important to them.
Another thing that Amazon focused on was the “hard middle”. It’s easy to reach 10 people by contacting them directly on the phone, or 10 million by placing an ad during a football match, but it is far harder to reach the people in between. The power of Amazon’s search function on their site together with product recommendations meant they were able to closely match the interests of these people, cementing their reputation as a customer focused brand that delivers what you want, when you want it.
The future of personalisation
The future of personalisation is open for debate, but many marketers agree it is not going anywhere. As an entity, consumers have come to expect personalised messages and recommendations. Anything less than that now looks insincere and lazy.
In principle, a marketing campaign that is contextually aware will be more effective than one that is not. Offering recommendations is fine, but offering them at the right time is even better. For example, a male customer might purchase a particular brand of ladies clothing at the same time each year. It would be safe to assume that he is purchasing this as a present for a family member or partner. Being proactive and making a few suggestions in the week leading up to the usual purchase period may be very welcome and may not only generate a sale, but build consumer trust too.
If the information we receive through marketing channels is aware of the wider context, it becomes far more valuable, and more likely to lead to further action by the consumer.
The only reservation for many potential customers are the privacy issues around personalised marketing. A specific message implies that the sender knows your name, browsing habits, past purchases and so on. There is also the worry that as they evolve, these marketing systems will become even more effective in predicting behaviour and can market to consumers accordingly.
Getting an email that seems to know what you are thinking may actually be off putting due to its uncanny accuracy.
However this is just one element of what is becoming a hugely successful facet of marketing. The benefits far outweigh the negatives, and as your customers become more familiar with the system, they will expect personalised messages, so it is very short sighted to ignore them now.
Why is everybody not doing it?
Put simply, personalisation is not more widespread because of the associated costs. It requires resources to work effectively on a large scale. Interpreting the data and converting that into personalised messages requires some robust software and an experienced development team.
Paul Phillips, technical director at Information Builders, says: “True personalisation is an incredibly data intensive task; both combining detailed, historical data and adding future, predictive insight. You need to be combining real-time data from a number of sources (such as GPS location, pages visited, products viewed, etc.) and combining this with an immense amount of background and historic data (such as previous transaction records or demographic detail) that provides additional context. Businesses need to be able to master the balance of live and contextual data to begin to make the most of personalisation.”
Personalisation done right
Treating the customer as an individual maximises the chance for an interaction on a personal level. Something which traditional marketing methods were not very good at doing. However it is important not to become fixated on the technology behind personalisation.
Michael Smith, marketing leader for mobile and social business at IBM states that it is important to find out how your customers want to engage with you before you do anything. “Customers expect something in return for their data. It’s easy to become fixated by the technology… be sure you’re using it to address a need.”
With that said, remember that personalisation is all about the individual, and the human element. It is a valuable tool in any marketing campaign, and, if used correctly, will clearly generate positive results and build better brands.
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