You have probably heard all the hype lately around the use of personalisation as a marketing strategy, with critics questioning the effectiveness of the approach.
Some studies state that 67% of consumers find personalised marketing communications intrusive if they’re from brands that they have never made a purchase from.
However, other studies show contextually relevant and customised marketing messages from brands in which a customer displays an interest can result in higher conversions and consumer engagement. So with the significant opportunity that personalised marketing creates for brands, where do they draw the line between being interesting versus invasive?
The proliferation and expansive adoption of digital media in recent years have fundamentally transformed consumer expectations and the overall customer experience. This shift in media consumption has created a constantly “switched-on” consumer and exposes users to a noisy and sometimes overwhelming advertising environment. Hyper personalised marketing has become an important online advertising strategy used to overcome this barrier and stems from the simple knowledge that salespeople are familiar with – that using personal details like a customer’s name establishes a relationship and builds rapport. This idea is even more crucial in the digital space, where face-to-face interactions are minimal or even non-existent. This technique has been evident in the online world with personalised email marketing that addresses customers by their name. Personalisation marketing statistics show that this method receives 29% more opens and a 41% higher click-through rate compared to generic email marketing campaigns.
Furthermore, today’s 24/7 cross-device customer provides marketers with an abundance of other data that can be used to create real-time contextually relevant and personalised messages. Personalised interactions and tailored messages can be crafted from consumer data such as device usage, purchase history, preferences, lifestyle choices and family characteristics. These insights help customise communication messages and help create a fully integrated cross-channel approach, facilitating a customer’s journey through the marketing funnel. The collection of data usage of data analytics tools also helps marketers rationalise their approach and create stronger, more captivating personalised brand stories and experiences. The ability to be able to offer a personalised service both digitally and in-person allows for greater customer retention through consistency and relevancy.
However, the usage and collection of such data have been an area of concern amongst consumers and marketers alike. As previously mentioned, 67% of consumer’s dislike when their personal information is used by marketers from brands that they have no previous affiliation with, finding it rather invasive. Further to this point, 54% of marketers feel uneasy about how their own personal data is used when they’re the consumer themselves and 1/3 acknowledge a concern about the breach of data privacy within their organisations.
This concern creates a barrier to the implementation of a personalised approach, however, it is imperative to highlight 87% of consumers actually believe it is acceptable for brands to use their data provided that they’re a previous consumer and that the messaging is relevant. This demonstrates that the consumer data needs to be used correctly to avoid irrelevant, unconnected messages that are out of context. Failure to comply with this simple consumer expectation can have the opposite effect of what a personalised approach is set out to do by damaging consumer relationships. Mistakenly utilising consumer data is only an issue when there is no relevance, value or convenience for the consumer.
So how can marketers effectively utilise personalised data to better inform their campaign strategies, while staying relevant and meaningful?
Many consumers agree that the top justifiable reasons for digital media agencies and marketers to use their personal information is for when they are given something of value.These experiences may include discounts on previously purchased items, birthday rewards, local store information, information on new products that are similar to previous purchases and prompts for goods and services that need to be purchased on a reoccurring basis. Marketers can also use consumer data to pre-fill personal details which can help drive conversions and increase sales. Such personalised marketing techniques and customer services further reiterate that personalised data needs to be used to provide value and relevancy to be engaging and add to the customer experience.
Customer experience has become a major focus for modern business as consumers become engulfed in a vast amount of marketing messages both offline and online. As 78% of consumers express a demand for some aspect of personalisation, compelling customer experiences are anticipated, and if these expectations are not met can have a detrimental effect on the business to customer relationship. Using a range of consumer data, marketers can add to their creative process by personalising brand experience making it more relevant and interesting. Personalised marketing benefits customer service, increases product satisfaction and encourages brand loyalty with studies proving that loyal customers are 90% more likely to be frequent shoppers. Netflix is a great example of this, in which 60% of their rentals are from recommendations that they have made to the consumer based on their personal information.
Despite the concerns with data and intrusion which can make it difficult to get personalisation right, the creation of convenient, relevant and valuable personal messages and customised advertising can provide businesses with endless opportunities. The one to one marketing approach and creation of personalised marketing messages has become an essential brand strategy in which marketing efforts have become more predictive rather than reactive.
At RGC Digital Marketing, we are a digital marketing agency that is dedicated to providing a range of solutions to create positive consumer relationships. For more information on our services, please contact Richard on (02) 8883 2988 or email richard@rgcadvertising.com.au
