What is personalized marketing?

Customer connection is an element that’s consistently overlooked by businesses. Companies fail to recognize how vital it is to create an established connection with their audience. When customers feel connected to the brand, more than 50% of them are willing to spend more with that business. Customer retention statistics show that a brand that lacks personalization is why consumers look for another business. 

The question now is – how can businesses create such a connection with their customers? A simple yet proven way to do it would be through personalized marketing. This marketing style is done by small businesses to scale and is utilized by multinational companies to stay at the top.

This article will define what personalized marketing is and how you can use it effectively for your business. So get your pen and papers ready, and let’s get right to the topic!

What is personalized marketing?

There are a lot of marketing trends that have passed throughout the years. We’ve seen a lot of various marketing styles that have become popular, yet after a few months, they are gone and never heard of again. That is how fast the world of marketing is – one thing can be popular today, then the next day, you’ll never see it.

However, personalized marketing has stood the test of time. It has proven its worth to professionals in the space through the results it gives. This marketing style is tailoring your marketing campaigns and materials based on the data you’ve collected from your customers.

Personalized marketing is the opposite of the general marketing style wherein marketers just run a campaign trying to hit everyone in their audience. That style had its glory days and gained some traction a couple years back. This is where older marketing styles like newspaper ads, tv commercials, and radio ads belong.

In today’s consumer landscape, a generalized style of marketing doesn’t work anymore. Consumers nowadays want marketing campaigns that speak to them. They want the type of promotions that address the problems they are facing and know what they are going through. And that is exactly what personalized marketing can do. 

The goal of personalized marketing is to create a connection with your audience through the different marketing campaigns you’ll be using. This style truly engages your customers or prospects by addressing their needs and pain points.

Reading the definition might be simple, but this is just the tip of the iceberg. Continue reading to see how you can apply it and understand the different challenges and benefits you need to know.

Why personalized marketing?

There are a lot of reasons why personalized marketing has stayed and not disappeared like other digital marketing trends. One simple reason can be that it simply works – structuring your campaigns like its talking to your customers is always received well.

To further support this claim, here are statistics given by various businesses on how beneficial personalization is:

• Accenture reported that 91% of consumers are more likely to shop with businesses that recognize and provide relevant offers and recommendations.
• A recent survey by Statista showed that the share of industry professionals that uses marketing personalization in the US ranges from 78 - 96%.
• Forrester mentioned that 89% of digital businesses are investing in personalization. This includes companies like Netflix, Sephora, Wells Fargo, Coca-Cola, and many more.
• SalesForce stated that 66% of customers expect companies to understand their unique needs and expectations. They want to be treated like a person, not a number.
• Instapage shared that 92% of shoppers online are influenced by personalized homepage promotions to buy.
• Econsultancy wrote that four in five (80%) businesses had seen many improvements after implementing personalization in their processes.
• SmarterHQ stated that 70% of millennials are annoyed and frustrated when brands send irrelevant emails.
• Epsilon shared that 80% of consumers are more likely to do business with a company if it offers personalized experiences, and 90% of them find personalization appealing.
• SlideShare showed a statistic that 80% of consumers are more likely to buy from a company that provides a tailored experience.
• LiveClicker mentioned that companies that use advanced personalization see returns of 20:1.
  

Given the positive statistics behind personalized marketing, it’s a no-brainer as to why more and more companies started incorporating this strategy in their own marketing processes. Consumers are humans that always yearn for that human connection regardless of whether they admit it or not. 

With these facts surrounding how important personalization is, it is now the job of businesses and entrepreneurs like you to find an effective way to connect with your audience.

How to create a personalized marketing strategy

Now that you’ve understood what personalized marketing is and why it is widely used, it’s time to know how to start creating your own strategy. I’ve listed down below 5 ways on how you can begin.

1. Have the right technology in your business process

You can’t win a war without using proper tools. The same goes in the marketing field – you need to be equipped with the proper technology to achieve your marketing goals. When it comes to starting a personalized marketing strategy, your marketing tool should be able to handle data, segmentation, and automation.

Using the right technology can increase the chances of success of this endeavor. The technology you’ve chosen should be able to do these things effectively:

• Data collection
• Content personalization
• Automation
• Capturing feedback, recommendations, and suggestions

2. Collect as much data as possible

It’s impossible to fully know what your customers want in just a single collection of data. This process is a continuous one and can’t be done overnight. With the proper technology in place, the process of this activity can be a lot simpler and smoother.

Marketers should get data like shopping cart data, purchase history, emails opened, linked clicks, promotional posts, and marketing materials engaged with. These are just some of the data needed to be taken.

The data that needs to be studied would vary for each business. Some businesses look at what type of service the client is purchasing, what type of promotional discounts they interact with the most, are they fond of games, do they like being in a community, etc.

3. Segment your customers

After collecting data and information, the next step is segmenting your customers. The only way for a business not to fall under generalizing its marketing campaign would be to segment its audience.

It is through segmentation that you can manage your large group of audiences. You can separate and cluster the customers who have the same interests, hobbies, and likes. You can even group these people with how they interact with your marketing campaigns.

For example, you can have a group where that set of customers likes blog posts, and you can have another set for those who are into video promotions. 

Another example could be how a skincare business separates its audience by identifying which ones only like their facial product and separating them from the group that only buys body lotions. This way, the business can only market the group’s desired products, which ultimately improves their conversion rates.

4. Brainstorm and execute

After segmenting your audience group, it’s time to talk to your team about how you can execute your personalized marketing campaigns. Think about what platforms you should do this on, how you should present it, and the best and most efficient way to convert. The more specific it is, the better. This will avoid failed executions and confusion.

Once you’ve laid down the answers, it’s time to execute your marketing campaign. Make sure to take note of the metrics of the campaign when you’ve started them. You will use those numbers in the next step. But right now, focus on deploying the campaign as perfectly as you can.

5. Update and refine the process

After running your campaigns for several months, it’s time to look back on how they performed. This is the time when you visit the numbers I’ve mentioned above. Look at them with your team and evaluate if it has reached the metrics you were hoping for.

If yes, then that’s great. If not, then there’s still room for improvement. Whatever the result is, take note of what worked and what didn’t. Go back to your process and check what you could have done better on. Improve these things and update your campaigns again so you can make your customers keep coming back for more. This is how great marketing campaigns are done – through constant testing, evaluating, and refining processes.

Challenges in personalized marketing

It is not always rainbows and sunshine with personalized marketing. Just like any marketing style, it also comes with challenges that marketers need to go through. I don’t want you to adhere to this marketing style without giving you the full picture. Here are some of the challenges you need to be aware of:

Executing personalized marketing is never easy

Starting and running a campaign may look easy on paper, but it is harder to execute these things in reality. Businesses know how important personalization is, but there’s a reason why not every company out there can do it.

Some share that their personalized approach doesn't go as planned wherein companies congratulate their customers for having their first baby only to find out the person wasn’t even pregnant. Some would congratulate people on their wedding even though they are still single. 

Funny stories like this happen daily because the tools and processes of the companies were not efficient.

Coming off as creepy to your customers

Although most consumers want personalized campaigns, some find it creepy that businesses know exactly what they’re looking for. Some companies take personalization to the next level to the point that prospects are tweeting about them. One thing’s for sure, you don’t want to be on the receiving end of a tweet like this:

Segmentation problems

When you have a large customer base, you can come up with many classifications for your customers. Some marketers saw this as a problem because they had trouble linking data for each group, and creating content can be tiresome and confusing.

This challenge can be easily solved with marketing automation, CRM solutions, and email campaign management platforms out in the market today. Popular platforms can simply address these problems by clicking buttons and showing a bit of effort.

Benefits of personalized marketing

If there are challenges to personalized marketing, you can bet that the benefits outweigh the problems. Here are the best benefits that personalized marketing can give to you and your business:

Improved customer experience

Once you’re able to run effective personalized marketing campaigns for your customers and prospects, you are ultimately improving your customer experience as well. People feel delighted when the business knows exactly what they’re going through and presents solutions to solve their problems.

Increase brand loyalty

If you’re able to deliver campaigns that answers the specific problems of your customers, the more chances of them becoming repeat customers of your business. Why would they look for other businesses when they know that your company knows how to solve their problems? 

Better conversion rates

If customers see that your business presents solutions to their pain points and you present it engagingly, then the percentage of them buying significantly increases. This will give you better conversion rates for your campaigns and marketing ads.

Higher engagement numbers

Once you’ve understood what your market wants, and you’re able to leverage that information in your campaigns, your engagement numbers will significantly increase. This will give your social media ads and other campaigns more interaction with your market.

Drive revenue

Once you’ve achieved the above benefits, your revenue will be positively affected as well. The effects of higher conversion rate, improved customer experience, and increased brand loyalty will trickle down to higher revenue for the business.

Personalized marketing at work (with real examples)

3Wishes

3Wishes knows that when they’re selling costumes and lingeries, they’re not only catering to women with coca-cola body figures, they also have plus size women in their audience. To include the demand of this particular segment in their market, they created a shopping page dedicated to their plus-size customers. The business has also included them on Valentine’s Day lingerie promotions.

Coca-Cola

Coca-Cola is a household name well known for more than a decade already. But in 2014, it needed a campaign to be much closer to its customers. The company wanted to create a personalized marketing experience to strengthen its relationship with its market.

So they created the Share A Coke campaign wherein they printed the top names of people and used it on the label of all their products. The campaign was such a huge success that it was deployed worldwide. It has drastically increased its metrics and it was one of the most iconic personalized marketing campaign in the industry.

Impossible and Infinite Recovery

One way of being much closer to your market is to showcase them on your social feed. A lot of businesses have been doing this since it can also fuel others to use their products or services. 

Impossible does this by displaying the people who use their products on their social media platforms. This act even creates a community wherein people can ask the others who were presented by the business and share their experience with the products or services of the brand. 

Infinite Recovery is another business in the service-based industry that does the same strategy to gain better relationships with their client and gain the trust of their prospects. The company showcase their successful clients on their Instagram and other social platforms to inspire and show others that change is really possible with them. It conveys a message that sometimes inpatient treatment is all that is needed.

Medical Alert Buyers Guide

When using personalized marketing, don’t limit your imagination that only businesses can utilize this powerful marketing strategy. Blogs too can leverage this strategy to increase their website traffic and reader count.

An example here would be from Medical Alert Buyers Guide, whose blog topics are very niche and focus on elderly medical alert products. This strategy makes the blog website a go-to site for medical alert systems since it made sure to write topics that people in the niche would like or are interested in.

Spotify

Another great personalized marketing campaign is brought to us by Spotify. This campaign leverages data and users’ interest to create more support and love from them.

Wouldn’t it be amazing to get an email from your favorite artist? That’s exactly what Spotify did for their campaign. The email included a tour date that the user can look at and a call to action to buy the ticket at the end of the email.

Conclusion

It’s no secret that personalized marketing has worked wonders for businesses that have used it properly. If you haven’t incorporated it into your marketing processes, I highly suggest you do this in 2022. 

Besides increasing metrics, this marketing style is important to build an excellent customer experience and increase customer loyalty. It’s one of those strategies that strengthen the connection between the consumer and the business.

By following the steps above, you’re on your way to creating amazing and effective personalized marketing campaigns that your customers and prospects will surely love.