The Impact of Personalization
in Digital Marketing Today

Intro

As marketers, we always want to create innovative, witty campaigns that everyone will remember. But not everyone can be Oatly, Innocent, Surreal, or any other company that lives through their brand awareness. 

There's an easy way for you to grab people's attention without having to reinvent the wheel. You guessed it. Personalization. 

As Nicole Martin so well put it: "When it comes down to it, the best marketing campaigns are the ones that show ROI, and personalization does just that."

Personalization in digital marketing has changed the way brands connect with people. When businesses understand personal likes and habits, they can create marketing strategies that speak directly to the consumer. 

But it's also a double-edged sword. Even though people prefer to be presented with content tailored to their preferences, they still want to protect their data. And over-personalized content tends to make people feel like Big Brother is indeed watching them. 

Let's have a look at how you can get started with personalization for digital marketing whilst avoiding the common pitfalls.

Understanding personalization in digital marketing

Personalization in digital marketing means changing marketing plans to fit each customer. Might sound like an impossible job when you serve hundreds of thousands of customers, but with the right solution, you can easily do it at scale.

You can use customer data, like purchase history and social media interactions, to share content that matters to each person. When you've grasped the potential behind personalization, you'll create better campaigns. These campaigns will hit home with your audiences and get good results.

So, what's personalization exactly?

Personalization in digital marketing means adapting strategies and content to individual customers using their data. At first, it just included things like using first names in emails. Now, it is much more advanced. It uses AI and machine learning to analyze large amounts of data. 

This change has gone from checking simple segments to guessing what customers will do and need. It helps you create very focused campaigns. Personalization keeps changing, bringing new ideas to marketing strategies that improve customer engagement and satisfaction.

The benefits of personalization in digital marketing

When you customize content based on what your audience likes and how they act, it can greatly improve customer engagement and satisfaction. It helps raise conversion rates and keeps customers loyal. Plainly put, it's easier to connect with someone when you show them you actually know them. It also allows you to make sure that you're only talking to relevant people who actually care about what you have to offer. 

Personalization improves marketing strategies, such as sending targeted messages and giving personalized product recommendations in your catalogs. A personalized approach also improves the customer experience, helps increase brand awareness, and builds long-lasting relationships. 

And at the end of the day, it improves your ROI, which is what you want, right?

The science behind personalized marketing

When you're gazing at something on Amazon, and then you suddenly get retargeted by ads of similar products, that's personalization done well! 

Data collection and analysis are key for creating personalized digital marketing experiences. It includes details like purchase history and behavior to provide tailored interactions. Let

Data collection and analysis for a tailored experience

To create a special experience, you need to use strong data collection and analysis. By looking at customer data, like purchase history and social media interactions, you can make content such as white papers or online magazine that matches what individual consumers need. 

By collecting and analyzing customer information, marketers can create experiences that feel tailor-made for each individual. According to an old, yet still relevant, study by Epsilon, 80% of consumers are more likely to make a purchase when brands offer personalized content experiences.

But how do we turn raw data into meaningful insights? AI and machine learning.

Leveraging AI and machine learning for enhanced personalization

By understanding things like purchase history, customer engagement, and social media interactions, AI can guess how customers will behave and what they might like. Machine learning helps you create product recommendations, email campaigns, and website personalization, which together form effective content marketing strategies. 

These technologies can process vast amounts of data to predict customer preferences and behaviors with impressive accuracy. In fact, research from Accenture found that 91% of consumers are more likely to shop with brands that recognize, remember, and provide relevant offers and recommendations.

Strategies for effective marketing personalization

Now that we've covered the tech behind personalization let's explore some practical strategies to implement in your marketing efforts

Segmenting your audience using data insights helps you send messages that connect with each person. By changing your strategies to fit the unique needs of your target audience, you can do personalized marketing well and achieve higher content engagement.

Segment your audience: One size does not fit all

Dividing your audience into specific groups based on shared characteristics allows for more precise targeting. A study by MailChimp found that segmented email campaigns had a 14.31% higher open rate compared to non-segmented campaigns.
That's why segmenting your audience is so important: to create messages that connect. When you group customers based on things like age, habits, or purchase history, you can make content that meets their needs. Using customer data helps you target your messages better and create good marketing strategies. This way, you can reach different groups in a more personal way. It can make customers more likely to buy and improve their overall satisfaction.

Personalize the customer journey across multiple touchpoints

A smooth customer journey in digital marketing is important. In fact, we're willing to argue that it's probably the most important aspect that leads to conversion. Using information from different sources like social media, email campaigns, and website visits helps you create a unique experience at every point of the customer's interaction with your brand. 

A cohesive, personalized experience across all channels can significantly boost engagement. According to McKinsey, companies that excel at personalization generate 40% more revenue from those activities than average players.

Here's how to implement personalization with a multi-channel approach:

Create a unified customer profile

Start by consolidating data from various sources (CRM, website analytics, social media, email interactions, etc.) to create a comprehensive view of each customer. This 360-degree profile should include:

• Demographic information
• Purchase history
• Browsing behavior
• Email engagement
• Social media interactions
• Customer service history

Map the customer journey

Identify all potential touchpoints a customer might have with your brand, such as:

• Social media
• Website
• Email
• Mobile app
• In-store experiences
• Customer support channels

Understand how customers typically move through these touchpoints and what their goals are at each stage.

Implement cross-channel tracking

Track customer interactions across channels using tools like Google Analytics or more advanced attribution modeling software. This helps you understand the customer's path to purchase and identify key decision points.

Social Listening

Social listening is a digital marketing technique where brands monitor and analyze online conversations and mentions about themselves, their products, competitors, or relevant topics across various social media platforms and other online channels.

By watching what people say about you on social media, you can learn about customer feelings, likes, and trends. This data helps you adjust your marketing strategy to meet customer expectations and provide personalized experiences. 

Using Neuro-Linguistic Programming (NLP) techniques, companies can analyze social media interactions to better understand customer behavior. This helps them improve their messaging and increase customer engagement. 

If you start using social listening, you'll be able to respond to market changes and keep improving your personalization efforts quickly.

Real-world examples of successful personalization

Don't just take our word for it. Here are some real-life examples of companies that you might have heard of 

Amazon: The eCom giant's personalized product recommendations

You've probably bought at least one time on Amazon in your life, or maybe you're a loyal customer. If the latter is the case, then have you noticed how accurate their recommendations are? 

Don't know what to get your dad for christmas? Amazon does. 

And this doesn't happen by chance, nor does it happen because they listen to you through your phone (or at least, not that we're aware of). 

Amazon has become a leader in using personalization to boost its business. It was one of the first major companies to use algorithms for product recommendations. Amazon is really smart about using data to understand what customers might want to buy, which helps it increase its sales.

Amazon personalizes its user experience with strategies like recommending products based on what similar people bought, suggesting items inspired by your previous shopping trends, and pointing out frequently bought-together items in customer newsletters. Could be a person around the same age as you and living in the same area. This personalization makes it easier for you to find things you might want ( maybe things you didn't even know you wanted!) and leads to more sales and app engagement.

Deep Learning

Amazon started really focusing on recommending products in 2010, with this feature that shows what other customers who bought the same items also purchased. It’s been super effective—about 35% of their sales come from these recommendations!

They didn’t stop there. Amazon uses advanced AI techniques called deep learning to get even better at this. It’s like they have this smart system that learns what you like by analyzing what you've viewed, bought, or even reviewed. So when you log in, it feels like the site knows you and suggests items you might actually want to buy next.

Personalized homepage

They also make sure every time you visit their site, the homepage is tailored just for you based on what you’ve done there recently. It feels like the website is reshaped to suit your tastes, making shopping more personal and fun! Plus, a lot of people feel like Amazon gives them loads of useful product info, which makes the whole shopping experience better.

Any business today should have a strong strategy for using data to personalize its digital interactions. Personalization is central to a modern digital strategy and can make a huge difference in driving sales and engagement.

In a nutshell, Amazon is killing it with personalization.

Netflix: Why do they always know what you'll watch next before you do?

Netflix has become wildly popular because of two main things: an amazing library of shows and movies and their clever use of AI to personalize what you see. Have you ever had that moment when you finish an episode and get the perfect recommendation for what to watch next? That’s Netflix’s AI at work. 

The whole thing started back when Netflix shifted from DVD rentals to streaming, and then even started producing its own hit shows like "House of Cards" and "Stranger Things." Now, with over 260 million subscribers, Netflix uses AI in a bunch of ways to keep people engaged and make sure they have a top-notch experience. 

AI recommendation system

Just like Amazon, Netflix also invested much in using AI and machine learning to power up its recommendation engines. The AI recommendation system is a big part of how Netflix tailors their content. Their algorithm checks out a ton of data about how you watch—what you watch, how much time you spend watching, and what other users with similar tastes watch. With this info, they create tailored suggestions for each user. They even make different trailers for the same show to appeal to different tastes!

Apart from recommendations, AI helps them with things like:

• Personalization: Showing you content you’re likely to enjoy based on your history.
• Streaming quality: Optimizing video quality so you have less buffering and interruptions.
• Thumbnails: Algorithmically choosing the most appealing image for each user to entice you to click on a show or movie.

For Netflix, all this AI magic increases viewer engagement, helps discover new hits, and keeps people coming back. For you, it means less time searching and more time enjoying your favorite shows or discovering new ones.

Netflix’s secret formula to personalize customer experience

Everything Netflix does is driven by data and powered by smart AI algorithms. The company is always brainstorming and testing ideas to ensure that whatever is disseminated on its platform matches the exact thought processes of its users. And, its efforts are pretty much evident. 

A/B Testing

One major method Netflix uses is A/B testing. Trying out two different types of product experiences with different groups and then seeing what works best. Netflix does this a lot—about 250 times a year! They test with around 100,000 users per experiment. For instance, they use these tests to decide which images or video teasers (landing cards) are most likely to catch your eye and make you click on a movie or show. This is a big part of why two people might have totally unique experiences on Netflix.

Differentiated's ABM campaign for Vodafone

Differentiated is a marketing agency based in the UK, and they specialize in ABM campaigns. ABM stands for Account Based Marketing, and simply put it's a marketing strategy that targets specific accounts or companies as a whole, rather than trying to reach out to a broader audience or market segment. It's a way if hyper-personalizing a campaign specifically to the needs and pain points of a prospect. They work with a lot of different brands, including the famous phone service provider: Vodafone. 

Vodafone wanted to show Royal Mail just how much they could help with tech and digital transformation. So, they developed a strategic campaign to get the attention of Royal Mail's senior decision-makers and educate them on Vodafone’s technology services.

Personalized digital Doc

To start, they created a digital Doc called “A Vision for Royal Mail’s Digitised Postal Service” using insights from various research methods. This Doc highlighted how both companies supported citizens during the pandemic, and it showcased Vodafone’s technology potential beyond just mobile services.

Vodafone didn’t stop at this Doc. They also sent out personalized letters and video cards to key Royal Mail executives, and even a neat tech gadget called the Smart Label to a select few, showing how it could revolutionize package delivery.

Social Media

Then, they ran a targeted LinkedIn campaign to engage over 200 Royal Mail decision-makers. The campaign worked wonders, opening up opportunities for conversations and meetings at top levels within Royal Mail, including discussions with executives and even the incoming CEO.

Overall, the campaign was highly successful, winning an award and securing new business opportunities for Vodafone within Royal Mail’s digital transformation journey.

To learn more about how success ful this campaign was, watch our conversation with Matt Neal, Differentiated's managing director:

Avoid the common pitfalls of personalization in digital marketing 

Navigating privacy issues and data protection laws is very important in personalizing marketing. When you follow rules like GDPR, you create trust with your customers. It's also important to avoid going too far with personalization. Finding a good balance matters. 

Respecting limits helps customers feel comfortable, but making sure personalization efforts improve the customer experience is a careful task. A thoughtful approach that focuses on customer expectations can help create effective personalization strategies.

Navigating privacy concerns and data protection laws

Navigating privacy concerns and data protection laws is important in personalized marketing. It's vital to follow rules like GDPR and CCPA to keep customers' trust. Strong security measures for customer data help protect against breaches and unauthorized access. Being transparent about data collection builds confidence and loyalty. Regular audits and staying updated on changing privacy laws are crucial. Focusing on data privacy not only reduces risks but also strengthens customer relationships in digital marketing.

Don't over-personalize

There's a huge difference between "Here's a show we think you'll like" and "Congrats on your new baby." Customers want personalized content, yes, but they don't want to feel like they're being watched. 

That's why you need to use creative empathy. It's about knowing what aspects of life (and how often) are okay to personalize. Think of creative empathy as a combination of using your imagination and your ability to understand and share someone else's feelings. It's like putting yourself in someone else's shoes to see the world from their perspective and then using that understanding to come up with creative solutions or ideas.

Over-personalization can make customers feel uncomfortable and worry about their privacy, harming your marketing efforts. When personalization becomes intrusive, it gives a bad impression of your brand. It's important to balance personalization with respect for personal privacy. 

Targeting customers too much using sensitive information can drive them away. Aim to keep a human touch in your digital interactions. Make sure that your automation does not hurt the customer experience. Finding the right balance is key to using personalization efforts without going too far.

Future trends in personalized marketing

Advancements in personalized marketing are changing to meet the needs of consumers. Voice search and personal assistants are becoming more important, changing how brands connect with people. 

Predictive analytics and intent-based marketing are changing how decisions are made. They help create special interactions based on user behavior. Embracing these new trends is key to keeping up in the busy digital world.

The rise of voice search and personal assistants

Voice search and personal assistants are changing how brands do digital marketing. With more people using smart speakers and voice devices, brands are adjusting to meet this trend. Personal assistants like Siri, Alexa, and Google Assistant are a bigger part of our daily lives so marketers are making their content better for voice searches to keep up. This offers new ways for brands to connect with consumers. This change shows how important it is to adapt marketing strategies to match how people behave.

Predictive analytics and intent-based marketing

Predictive analytics and intent-based marketing are changing the world of digital marketing. By looking at customer data and behavior, you can understand what customers want and provide very personal experiences. Predictive analytics uses machine learning to predict future results based on past data. It helps in creating targeted marketing efforts. 

Intent-based marketing aims to know customer intentions so that businesses can send the right messages. This increases both engagement and conversion rates. These new methods help marketers think ahead about what customers need. They also improve user experiences and create real connections. This is all shaping the future of personalized marketing.

The bottom line

If there's one thing you need to remember from this blog post, it's that personalization is here to stay. We talk of it as a new and innovative approach, but the truth is that it's already been around for more than a decade!

You don't need to be Amazon or Netflix to get started with personalization though. It can start with something as simple as including someone's first name and company name in your marketing collateral. And once you know your database is solid and that you can rely on it, you can explore more advanced techniques like ABM or intent-based marketing.