Consumer Insights Surrounding Custom Advertising Part 1
Custom advertising benefits consumers and businesses. “Consumers expect content that is both useful and contextually relevant -- the right information served at the right time.” The majority of customers say personalization has influenced their shopping decisions, and they are willing to share information about themselves in exchange for more enjoyable and relevant experiences that help them accomplish their goals. Consumers appreciate when irrelevant ads disappear, new products appear, and online shopping becomes easier. By responding to customers’ desire for more customized experiences, businesses with personalized marketing have observed an increase in sales, profit, online traffic, and customer loyalty. Affirming consumers' sense that they are in charge of their experience through personalization benefits the consumer and a company’s bottom line.
Consumers who experience personalized marketing are more likely to make purchases and become loyal customers. Customized experiences are so prevalent today that customers now expect them, with over 78% engaging with offers only if they reflect previous engagements with a brand. The vast majority, 75%, are more likely to buy when a company recognizes them by name, knows their purchase history, and/or makes recommendations based on past purchases. And a quarter of customers say personalization significantly influences what they ultimately buy; they chose, recommended, or paid more for a brand that provided a personalized experience. There is one very large caveat to personalization, however: a company's marketing must be consistent across all channels. The positive rewards for catering to customers’ preferences can be easily lost when messages become disjointed.
The strong evidence that consumers want personalized experiences begs the question of which engagement strategies are most effective. The tactical approach considers that the majority of customers that desire personalization want targeted coupons, offers, and product recommendations. The broader view considers that “customers don’t see in channels, they engage with a brand” - the specific offer or medium of communication, per se, are not the greatest leverage point, rather it is the collective emotion a customer aggregates through all interactions with a particular brand that has the greatest cumulative impact. That said, some marketing approaches yield greater positive experiences for consumers than others.
The bulk email is a thing of the past. Personalized promotional emails increased transaction rates and revenue over 600%. In triggered email campaigns, personalization doubled transaction rates. Personalized subject lines increase unique open rates by 26% overall, with the greatest impact in the travel industry and the least impact in the publishing industry. Confirmed opt-in emails have higher unique clicks, specifically for sign-up and welcome emails. Second abandoned cart reminders have the highest click rate. Personalized emails that take into account a customer’s names, preferences, and/or shopping/browsing history are significantly more likely to be clicked – and even more so if the email is opened on a mobile device.
It is worth noting that data hygiene is crucial for email campaigns to be successful. While outside the scope of this analysis, a successful campaign requires accurate email addresses and consumer information.
E-receipts are a relatively new, and powerful, method of marketing. They have double the open rates of bulk email campaigns and generate more revenue per email. The most successful of these efforts, in terms of click and transaction rates, focus on up-selling and cross-selling.
Personalized marketing on social media led to 41 percent higher unique click rates.
Text messaging is not a common form of marketing. Only 7% of brands marketed on both SMS and MMS, with over 50% not marketing on either SMS/MMS. Increasing the impact of personalization via text message would likely benefit from an increased usage of these channels, in addition to the aforementioned personalization strategies.
Forty-five percent of marketers use pop-up windows on their website, largely to collect email addresses. Little information was available on whether pop-up windows later became personalized after a customer was recognized.
PUSH AND IN-APP NOTIFICATIONS
Information on these two channels was not available.
The general theme of personalized marketing is that customers experience timely, relevant, coherent information that makes them feel good about the company. The newer areas of research consider behavioral targeting that goes beyond demographics to consider customer interests and characteristics. While the many channels of marketing and increasing personalization can generate significant amounts of fragmented data, a staged gate approach that begins with simpler market segments such as gender/geography is advisable. A simple beginning that is thoughtfully implemented will allow a company to successfully employ personalized marketing strategies across multiple channels to create more delightful experiences for consumers and more profit for companies.