Personalization has become a key part of digital marketing, with audiences favoring content they deem to be personally relevant (while, in many cases, expressing frustration towards content that has nothing to do with their interests). In fact, of the nearly $400 billion at stake in US retail, the majority of revenue is now reportedly going to the 15 percent of businesses properly handling ad personalization.
Today, however, there are right and wrong ways to approach personalization. As the audience experience evolves and gives way to increasingly particular expectations, retailers must remain diligent in their personalization efforts to maximize success.
Value for value
On average, online shoppers have gained a stronger understanding and appreciation of personalized digital marketing; they enjoy receiving ads based on their personal data so long as that content reflects their interests or desires. That said, audiences have also shifted to a “value for value” mentality when it comes to such targeting. In other words, “they are comfortable sharing their information as long as they feel like they are getting value in return.”
To help balance the scales in this manner, many retailers focus on personalized ads that save the customer time, offer them a discount or similar incentive, and showcase the right products from the get-go. Broadly speaking, audiences tend to value the former two fields above all others, as they are now conditioned to a seamless, fast-paced experience when deciding between brands and products.
Naturally, identity-based marketing has risen as a major arm of proper ad personalization. This tactic “relies on customers to self-select into segments” that are, in turn, used to create personalized messaging — and it is far from new. Coca-Cola, for instance, displayed mastery in this field with its 2014 “Share a Coke” campaign, which encouraged consumers to find bottles displaying their names or the names of friends or family members. By encouraging these consumers to “share a coke” with someone close to them (while simultaneously promoting social media sharing of such moments) Coca-Cola exhibited an intimate, yet wide-reaching marketing approach that allowed its consumers to identify with their products in a new way.
To enhance their ads at a deeper personal level, today’s digital marketers should look to campaigns like “Share a Coke” as a template for success, exploiting any opportunity to merge buyer urgency with an underlying sense of worth and community.
Breaking new ground
As alluded to earlier, the majority of retailers admit to poorly managing or completely forgoing ad personalization. In many cases, these entities aren’t even aware of this untapped potential and have simply dragged their feet in promoting change.
Making this leap is, therefore, as crucial as ever for retailers still operating on outdated marketing norms. Currently, retailers are investing a collective 0.7 percent of their revenue in ad personalization, though they are expected to increase such spending by 10 percent through 2022. Tangible starting points, in this regard, include relevant promotions and deals, wish list-style features aimed at future transactions, and loyalty programs offering discounts for consistent spending.
Moving ahead, it is imperative for retailers to implement such ideas to remain both profitable and competitive.