Guide to marketing personalization — benefits, examples, and more

Personalization is taking what we know about a person and their digital behavior at a given point in time and then using it to determine and deliver the next best experience that will have a positive impact on business objectives.

Incorporating personalization into your marketing strategy is vital if you want to increase customer engagement and conversions. But first, you must understand what personalization is and how it can help you improve your business.

In this guide:

• What is marketing personalization?
• Why is personalization important?
• What are some challenges of marketing personalization?
• What information do companies use to personalize marketing?
• How to get started with marketing personalization
• Tools for marketing personalization
• Unlock the benefits of personalization with marketing automation

What is marketing personalization?

Marketing personalization is the process of using data to target and retarget leads with a brand message that speaks directly to specific customers’ interests, demographics, and buying behavior.

With a personalized marketing strategy, your customers should feel like the brand message was made just for them. So personalized marketing may sometimes be called one-to-one or individual marketing.

Companies like Netflix, Amazon, and YouTube use personalization tactically — using an algorithm to automate suggested shows, products, and videos for you to explore. These recommendations are based on what you search, purchase and watch, and on the viewing habits of other users with similar tastes.

However, personalization isn’t just for digital channels, and customer engagement is only one benefit of personalization. Customers are more likely to revisit their favorite hotels, cafes, or salons if they feel they are being delivered a targeted, personalized user experience. They’ll show loyalty to brands that make them feel special.

Why is personalization important?

Better connection with customers

Users will consume a huge variety of ads per day. Your message must cut through the noise — not by being louder, but by being more relevant.

For instance, with personalized emails that incorporate your leads’ names and other tailored additions, your email is six times as likely to convert, according to Campaign Monitor. What’s more, 73% of customers say they’d rather do business with brands who personalize their email comms.

Increased revenue

Personalized shopping experiences encourage consumers to become repeat buyers. Brands that create personalized experiences see a spike in transactional rates, buyer retention, and revenue per transaction.

It also shows up in their bottom line: One study suggested that personalized marketing can boost revenue by up to 15%. On the other hand, a lack of personalization can damage your brand: It’s suggested that 63% of consumers are highly annoyed when brands rely on old-fashioned, generic ad messaging.

Improved buyer targeting

When do your customers like to be contacted? How much contact do they want? Getting to know your audience is a key part of personalization.

Stronger brand reputation

People buy from brands that provide them with a customer experience that makes them feel good. Showing that you understand your customers’ emotions will make them want to do business with you.

Take a brand like the pet supply company Chewy, which tracks orders and reacts to their customers’ buying behaviors with tailored communication efforts.

If they discover that a customer stops ordering because of their pet’s death, they will reach out personally to offer condolences. This kind of personalized experience makes a lasting impression and will endear a brand to its customers long-term.

Enhanced lead generation

When you solve your target audience’s problems, it builds trust and makes your customers more willing to provide feedback and information.

More effective customer retargeting

The reality is customers won’t buy from you right away. It can take multiple interactions before leads are willing to make a purchase. However, personalization allows you to begin nurturing a relationship, making consumers excited about doing business with you.

Satisfying customer experience

Making a customer feel seen, heard, and understood through personalization tactics is a fantastic way to improve your customers’ overall customer experience.

Increased customer loyalty

Consumers want personalized content — and it encourages them to seek more information or content about your brand. The more positive experiences your leads have, the closer they get to becoming a loyal customer.

Greater return on marketing investment

Personalization can help you gain more loyal followers who follow you for life — or at least longer than they would have without personalization. Research shows that quickly growing companies generate 40% more revenue from personalization than their slower-growing counterparts.

What are some challenges of marketing personalization?

Like any business initiative that relies heavily on emerging technology, adopting personalization in marketing can be challenging. For instance, 63% of digital marketing leaders say they still struggle with personalization, yet only 17% use AI and machine learning.

Here are some of the common pitfalls those digital marketers may be facing:

• Difficulty gathering customer data.  Website, app, and email analytics can track customer behavior, but the accuracy can sometimes leave marketers unsure.
• Retargeting that is too aggressive or intrusive.  Maybe a customer considered buying a pair of shoes on your site and even placed them in their cart, only to decide on a different brand. Targeting them for weeks or even months about the pair of shoes they already decided against will be off-putting.
• Not allocating enough resources. Strategy is still a people skill, no matter how automated your personalization may be. Maintenance, including updates and strategic pivots, must be helmed by humans who have a big-picture understanding of a company’s brand.
• Struggling to link data to individual customer profiles.  The data that businesses collect is extremely valuable. However, marketers often struggle to unify their customer data into a single customer profile.
• Experiencing consumer data silos. If your marketing and sales teams aren’t aligned on tracking customer data, each department may end up sending duplicate messaging.

What information do companies use to personalize marketing?

Marketing personalization can take place across the entire visitor journey. It can start at first touch, using information such as location, device type, or browser. There might also be distinguishing factors, like language, that impact the experience that the user is expecting or wants to see.

Information pulled from anonymous users can also include the device the customer is using. A person’s behavior on a desktop may be different on a mobile device.

Companies also look at the number of times a user visited a site, what the user is browsing, where they came from, and even the time, as behavior changes throughout the day.

After someone authenticates and provides personal information, segments can be enriched with additional profile data. Once people identify themselves, you can start to match all kinds of information from a CRM or a customer record of some kind, including purchase history and loyalty or award status.

How to get started with marketing personalization

Step 1: Define your personalization strategy

There are many different online marketing channels and stages of the marketing funnel where personalized marketing can be effective.

• Acquisition — such as landing page personalization
• Conversion — including abandoned basket and tailored retargeting campaigns
• Growth — recommended products, upsells, and cross-sells
• Retention  — like special offers on birthdays and loyalty discounts

Think about the best channels for achieving the personalization you want to see at each stage of the journey.

Personalizing your website

When personalizing your website, focus on aligning its elements with your target demographic to meet their needs.

For example, you can use a visitor’s IP address to create a tailored header or greeting. And consider placing a personalized call-to-action on your site that encourages leads to click through to another page, sign up for an emailing list, or check out your shop.

You can also highlight relevant products or service features, recommend solutions to common concerns the customer might have, and even create a blog with targeted content that engages your leads based on their interests, demographics, and behavioral data.

Email marketing

Generic emails are a thing of the past. To your leads, an impersonal email is no different than spam. It provides little value and may even be flagged as junk mail.

Personalizing emails can boost ROI, result in improved engagement, and help to create relevant content. Proven strategies include segmenting your mailing list, utilizing targeted messaging, tracking behavior, or retargeting abandoned cart shoppers.

Step 2: Plan how you’re going to capture and use data

There are a variety of ways of capturing data, including:

• Email preference settings to understand how customers wish to be contacted and what is of interest to them
• Quizzes on your website to help understand what customers are engaged with
• Cookie-based tracking of on-site behavior
• Data captured from conversations and engagements with customer support or chatbots

Keep in mind that when you’re tracking their data, consumers want to give consent and be informed.

It’s important to disclose that you monitor user data to build trust and transparency between your brand and your consumers. Offer your consumers the chance to opt out or provide information at will. Allowing your customers to create profiles or accounts is one way to do this.

However, the challenge is often not capturing the data, but making sure it can be used effectively. This takes us to Step 3.

Step 3: Confirm the technology stack

It’s likely that your customer relationship management software (CRM) will become the hub for all the customer information gathered from sales calls, third-party data providers, and lead capture forms in one place.

Your CRM will automatically update prospect information, so your marketing team and technologies always have access to accurate data in real time. There are specialist technologies that can help deliver personalized content across different marketing channels.

For example, there are specialty display personalization tools, email personalization tools, basket abandonment personalization tools, paid search personalization tools, and so on. It’s entirely possible to hook up your CRM to various tools to deliver different personalization across different channels.

Step 4: Develop and activate

After doing a lot of the behind-the-scenes work, it’s time to look at the specifics of your personalization campaigns and activate them.

Depending on your technology decision, you’re likely to have options on whether you want to set manual rules for things like product recommendations or whether you want to entrust the personalization to AI.

You’ll also have decisions to make around visuals for any campaigns, the specifics of any messaging, and the frequency and timing of any cross-sell and remarketing campaigns.

Step 5: Test and refine

Once your personalized marketing campaign is live, it’s time to test and refine in the pursuit of continuous improvement.

You can monitor certain areas of your website or email campaigns that use personalization to understand where the most effective tests might be executed.

A good way to test personalized marketing is A/B testing, where you can compare how various audiences respond to different messages.

Tools for marketing personalization

Data analytics

With data analytics you use data from page views, email clickthrough rates, and other measures to notice trends and gather insights into customer behaviors. You can then use this information to create personalized marketing strategies.

Data management

Data must be organized, maintained, and stored to be effective. From there, data can be shared with publishers and digital ad buyers to land those personalized experiences.

Customer relationship management (CRM)

Keep your customers’ data organized on one single platform. CRMs are key for seeing how customers interact with your company and can help better inform marketing strategies.

Post-click landing page

This is a standalone page separate from your website’s navigation usually used to convince a customer to take an action. Because it’s standalone, tracking is specific to this marketing campaign, making it more efficient.

Customer data platform (CDP)

A CDP is a centralized platform that holds data from multiple sources. It’s a great resource for marketing personalization because it holds data on all touchpoints and interactions a customer has with your company.

Unlock the benefits of personalization with marketing automation

Personalization is essential to the success of your marketing strategy.

However, to gather, analyze, and apply your consumer information, you’ll need to pair your personalization efforts with marketing automation to engage with your customers across channels consistently and efficiently.

With Marketo Engage, you can not only identify and segment your most promising leads by interests and behavior but also tailor your lead nurturing process. From initial contact to point-of-sale, Marketo lets you adjust your messaging for each prospect based on consumer insights and level of engagement.

Sign up for the Marketo Engage interactive tour to learn how it can help you start personalizing your marketing today.