By Mark Boyles
Marketing communications has been overtaken in recent years by a headlong rush to fulfill the promises of digital marketing and personalized content.
From retailers to B2B organizations, expensive digital stacks have been purchased, marketing strategies overhauled, personnel reorganized, KPIs reoriented and salespeople redeployed to make it happen in the marketplace. Where to from here?
That’s not clear, but who could resist an idea that combines most of the “future of marketing” concepts from the past few years? It’s all here − from big data and content marketing, to predictive models and algorithms, to machine learning and artificial intelligence.
Yet, the goal of personalized, relevant messaging that engages and incites loyalty − all delivered at the right time and channel − has proven elusive for many, if not most, marketers.
Search for the grail
McKinsey & Company refers to “personalization at scale” the Holy Grail of Marketing. They suggest that if it’s not at scale then the effects won’t be fully realized. But lament that many marketers don’t work with the data they have and spend too much time seeking a 360° customer view.
Marketers find it irresistible to talk directly to qualified buyers and only pay for messaging seen by those likely to purchase. Alas, the fly in the ointment is security and privacy concerns that arise when personal data is collected, shared and analyzed. From Facebook and the NSA to Equifax and Joe’s Bargain Barn, who can you trust with your personal data?
Anger, denial, resentment
Let’s start with a decidedly angry point of view − supplied by best-selling author and Facebook ranter extraordinaire, Hollis Gillespie.
She opens: “Dear Millennials Who Run Facebook Marketing.” She continues: “Here’s the thing, I’m a woman over fifty…I’ve faced a bunch of *?!# you’ll never come close to understanding until you’ve aged into the periphery of my experience. She closes strong: “So take your *?!# Facebook ads you think ‘target’ me, like the ones with the disgusting pics of diseased gums and the surgical cures for ‘batwing’ arms, and….”
Hollis, we feel your pain. But folks over 50 are more likely to suffer from assorted sordid ailments. And by and large, they are more likely to need Depends someday soon, too. Congrats if that’s not you, but there’s really no point in raging against this particular machine.
Don’t take personalization so personally
Facebook’s struggles are many and just keep coming. Deservedly so, given their cavalier attitude in recent years. They have been backpedaling furiously from their infamous claim they were just “a platform” and neither the advertiser of record nor a publisher.
“With data analytics, in the long run, you’ll see fewer irrelevant ads. It has been said that in the digital age there is no privacy. Millennials readily accept that as a fact of life.”
Regardless, they are a data-intense enabler of targeted marketing that can be personalized to the nth degree. But they’re still not always spot on and often overly broad in their targeting, which is why Gillespie’s post struck a nerve.
Here’s a theory: Personalization is really depersonalization. Or, partial personalization. That is, you’re mostly targeted based on some of your actions in the web world by advertisers who don’t fully know about you as an individual. If you buy organic cereal, you’re more likely to see messaging for organic foods.
So please don’t take it personally. With data analytics, in the long run, you’ll see fewer irrelevant ads. It has been said that in the digital age there is no privacy. Millennials readily accept that as a fact of life. And they understand the grand bargain: Trade some personal data for the likelihood of getting good info and pricing on stuff you’re interested in. Quid pro quo.
Are we there yet?
No, we’re not, but the scenery is changing quickly. Here’s a well-informed take on personalization from Susan Halzak, in her Bloomberg Gadfly column.
Halzak points out that her Amazon app repeatedly targets her with ads for new college dorm furnishings even though she is well into her 30s. She says Amazon isn’t “the only shop that doesn’t exactly offer the hyper-tailored experience the retail industry has promised for years.”
In fact, consumers in a recent survey said Amazon was the leader in digital personalization.
Retailers leading the pack
In retail, the goal is to be a better predictor of what your customer wants than the friendly clerk at your favorite store. That clerk only sees a little of you. Data can see a lot more.
For years online retailers have been making recommendations based on your past shopping and browsing history. “You also might like this” messages feel a lot like a storekeeper making thoughtful suggestions. Yet, it nothing more than digital cookies at work.
What’s behind some of these bigger advancements? Machine learning forms the basis of Artificial Intelligence (AI), which enables retailers like Amazon and Nike and services like Netflix to do personalization more effectively than ever before.
Also called Cognitive Learning and personified by IBM’s Watson, this is the imperfect present and near-perfect future of advertising. It takes predictions to a much higher plane, pulling it in from disparate sources and learning all along the way.
What about those retail ads that follow you around from web site to web site, often displaying things for which you just shopped? These “retargeting” ads use simple data sets to remind the harried consumer to reconsider before the sale is over.
Some shoppers think this sort of content is, at best, a personal intrusion that borders on stalking and, at worst, a ploy to hack their account. With the great Equifax compromise, voter roll leaks and retail data breaches, who’s to say that’s wrongheaded?
AI can feel like Big Brother and Sister Sally, too, are all up in your business. We’ve all had those moments where we wondered, “How did they know I wanted this?” or “Why do they think I’d want this?” Educated guesses are just that − guesses based on a set of facts. But since marketers are paying dearly for these guesses, there is some science and logic behind them.
Consultants at McKinsey & Co. have found personalization in marketing can lift sales by as much as 15 percent. Boston Consulting Group’s (BCG) research found it can boost revenue by 6 to 10 percent. BCG says some companies surveyed in the apparel, grocery and wholesale club businesses expected sales increases of 10 percent or more from personalization.
Your data’s rich
Personalization requires a lot of data, analysis and there are many levels of sophistication at play. Yet, the overall concept is simple:
The reality can be as complex as humanity itself. We’re all unique, but research shows we tend to act in fairly predictable ways. It’s not really creepy. It’s science. And that can be scary to some.
Bargaining and acceptance
Most consumers have come to both a truth and a truce regarding personal data: “Give a little, get a little.” Now that doesn’t seem too evil?
Usually, it’s not, but sometimes it is. For instance, it’s now an accepted fact that Russia used social media to meddle in our most recent presidential election. Our free market tools are being against us. Investigations continue.
Most consumers are coming around, at least in principle, according to a Marketing Insider study. It found that they are “more inclined to purchase and pay more for products from brands that personalize content marketing.” In fact, 88% say that “personally relevant content” improves how they feel about a brand, and 78% say it increases purchase intent for a brand’s products and services.
In fact, not personalizing content has its risks. In a December 2017 survey of internet users by InMoment, 46% said that a “lack of understanding of my needs” was a factor that could lead to a negative experience. Data is the only way to achieve that understanding on scale.
Down the road
As technology improves and becomes more widely understood, personalization will run the same course of every advancement in media and technology. At first misunderstood and feared, then begrudgingly accepted as inevitable.
Even with an uphill battle to develop regulations that provide the appropriate oversight and consumer protections, personalization will inevitably find its place.
“Digitally-driven content and personalized messaging are viewed as a boon by most marketers and a menace by many consumers. Who’s right? Well, it depends on which side of history you want to be on. There’s really no putting the digital genie back in the bottle.
In the meantime, check your GPS and off-road tires. For marketers, the road to personalization is neither well-mapped nor well-paved. But we have a lot of our best people on it.
About the Author
Over a long-term career at UPS, Mark focused on logistics, technology, sustainability, retail, and healthcare. He previously worked at Kimberly-Clark and Turner Broadcasting System and has consulted with Coca-Cola, AMI, Fleishman Hillard and point-Z marketing.
A graduate of Georgia State University with a BA in Journalism, Mark lives in Decatur with his wife, daughter and two occasionally active dogs. Interests include social and environmental causes, craft beer brewing, hiking, biking, and playing old-time music (not necessarily in that order).