Marketing Strategist: Chloe DeLuca
What is Personalized Marketing?
The textbook definition of personalized marketing is a strategy that collects and uses data to create a one-to-one marketing experience for customers (Instapage, 2023). Many companies utilize personalized marketing in their marketing strategies to differentiate themselves from their competition. An example of this would be creating targeted email campaigns that cater to different consumers’ needs. Consumers are more likely to check out these email campaigns, as they are more relevant to them than a general email that is distributed to everyone. This strategy helps establish a connection between consumers and companies by providing them with relevant, trustworthy information that is accommodated to their needs.
Where is Personalized Marketing Seen Today:
Netflix
A major company that uses personalized marketing strategies is Netflix. Netflix collects data on consumers viewing habits and uses it to mimic the thought process of its users. To start, Netflix uses a technique called A/B testing, which presents two different versions of experiences to its users to analyze their reactions and response to change. An example of this in action is their landing cards. Landing cards are the images or brief video teasers displayed to a user when browsing through Netflix’s main page of recommendations. Following the display of the landing card, the consumer may have varying desirability to watch a movie or show. By Netflix using these landing cards in A/B testing they are able to collect personalized data and display different landing cards for each consumer.
Netflix also utilizes AI and machine learning when preparing its recommendations for consumers. They assess consumer search history, rating data, the type of device they’re using, viewing data, and more to create predictions on future recommendations. By looking into all of this data, they are able to create unique homepages for their users and improve their individual experiences.
Lastly, Netflix also provides recommendations to consumers based on some of their own predictions. For example, depending on the time-of-day Netflix will adjust its recommendations for a consumer. If it is daytime, Netflix may recommend a longer program, while at night Netflix may recommend a shorter program assuming you may log off shortly after (Khandelwal, 2023).
Why Should Companies Use Personalized Marketing?
Lastly, personalized marketing can have many positive impacts on a company:
- Retain Customers & Build Brand Loyalty: Creating a marketing strategy that focuses on an individual consumer’s wants and needs can increase their retention. As a result, the consumer will feel more inclined to make a purchase from this company. Demonstrating this deeper understanding of customers builds a connection that ultimately increases brand loyalty.
- Shorter Sales Cycle: Collecting data on consumer behavior and tailoring interactions to consumers can shorten the amount of time it takes to complete a sale. This data can help eliminate the initial generic interactions distributed to consumers, therefore shortening the overall process.
- Improve Customer Experience: Creating personalized experiences for consumers helps provide solutions to their problems more quickly. Thus the consumer’s purchasing process is much more seamless and quicker to get through. (Simon, 2018)
Overall, personalized marketing provides a unique experience for consumers. Therefore, companies should consider this strategy to improve their relationship with consumers and increase business.
Sources
Instapage. “What Is Personalized Marketing & How Can You Excel at It? [Examples].” Instapage, Instapage, Inc., 5 Feb. 2023, https://instapage.com/blog/personalized-marketing.
Khandelwal, Astha. “How Does Amazon & Netflix Personalization Work?” Blog, Wingify, 22 Feb. 2023, https://vwo.com/blog/deliver-personalized-recommendations-the-amazon-netflix-way/.
Simon, Sha Drena. “What Is Personalized Marketing? Benefits, Examples & Best Practices.” Yokel Local: Digital Marketing and HubSpot Agency, YokeLocal, 3 Oct. 2018, https://www.yokellocal.com/blog/what-is-personalized-marketing.
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