At nectarOM, we mention the phrase marketing personalization quite a bit. In fact, we mention it so frequently we have decided to write a blog post about it just to make sure you’re completely clear on what it is.
The short definition is that marketing personalization is the process of sending targeted personalized messages to individuals based on consumer data acquired from various sources or channels.
In short, makes marketing much more relevant to your customer base by using existing customer data.
When we talk about implementing marketing personalization at a company, we assume that:
1) Your company already has a customer database. You may not be quite sure how to segment and target these individuals, but you have the list, which is the most important step. Marketing personalization does not assume that you want to acquire customers, rather, you want to be able to analyze your customer data more efficiently in order to send personalized messages.
2) You have data, but it’s scattered. You have data sitting in so many different places you have not the slightest clue on how to bring it all together to make recommendations. You have your standard customer data (name, email address), your customer transaction data, and your customer’s social data sitting in all these different places. Ideally, your marketing personalization is able to aggregate this data into one platform, like we do in our suite.
Personalization means that you are able to tailor targeted communications, whether it’s by email, text message, call center, or mobile app to your customers in a relevant way that will induce a higher probability of purchase.
So now you’re asking, so what? Who cares if my customers see relevant messages? I want to know what it does for my bottom line. Well I’ll give you an example. Let’s say you are an online hotel retailer and your customer is looking at multiple hotels in the New York City area. She has looked at several hotels in Manhattan but hasn’t actually made a booking yet. Based on click tracking information and searches, this online hotel retailer has configured trigger personalized emails to display NYC hotels in her price range to send a couple of days after she conducted her search. After seeing a great hotel deal in the email, she is inspired to make the booking.
The above is an example of how a potential could turn into a guaranteed revenue purchase. Just a simple email pushed the customer through the funnel from evaluation to purchase. Now imagine sending automated trigger emails to your entire consumer base. Below, we’ll do some quick math.
Assuming the following
Conversion rate: 1%
Customer base: 500,000
Customers who purchase: 500,000 * 1% = 5,000
Average Order Value: $300
Revenue: $300 * 5,000 = $1,500,000
That’s a huge chunk of change left on the table, and when your customer base is in the millions, it’s easy to see how marketing personalization can dramatically increase your bottom line.
So when someone asks you, “what is marketing personalization” you’ll be able to give them an answer with a short quantitative case study! Use your newfound understanding of marketing personalization to impress your friends and colleagues.
If you have any questions or comments, drop us a line below in the comments section.