Personalized Marketing vs Personal Customer Experience
A personal customer experience is not the same thing as personalized marketing. One is a genuine relationship and the other mimics one. Now that the world has moved online, many businesses are looking to capture the personal customer experience online. But how? Today, we’re digging into how to make your marketing feel more personal.
What is a personal customer experience?
First, let’s start with what a personal customer experience is, using a local small business as an example.
There used to be a small baby store in town, run by the warmest woman anyone had ever met. She greeted every customer like she was thrilled they were there and knew everyone’s names. Everyone felt like a regular, whether it was their first time in the store or their 50th.
She knew the exact right product to suggest for each situation, and customers were willing to pay more than they would elsewhere because the price was worth the warm hugs and feeling of belonging.
She connected mothers with groups of similar women, and most built friendships, which thrived around her store. Margaret was the original community builder, and when anyone around town was struggling with anything baby related, “Go see Margaret” was the first thing people told them.
If you’ve ever been a regular of a small business, you know the same feeling of a personal customer experience. It’s hard to beat. And the authentic relationship creates lifelong customers.
What is personalized marketing?
Personalized marketing on the other hand is using first-party data to make advertising and customer experiences feel unique to the customer. It’s using data to create the feeling of a one-to-one relationship, where the recipient receives the right messages, at the right time, with the right suggestions.
The average consumer is exposed to 4000-10000 marketing messages every single day. Does that seem extreme? Check out this experiment where a researcher decided to count and was exposed to 487 marketing exposures before breakfast.
We are exposed to so many ads each day that we tune the majority of them out. With less than 100 making it into our consciousness. The ads that make it, are usually personalized to us. Personalized marketing messages go beyond simply using a customer’s name (although that is a good start); personalized messages feel like they are for us and offer solutions to our personal pain points.
How do the two differ?
The businesses we interact with online don’t truly know us. An email or advertisement is never going to feel like a warm hug or match feeling you get when someone is genuinely excited to see you.
Personal customer experiences are an authentic connection, while personalized marketing is an understanding of your customer’s pain points, so you can provide them with relevant content and marketing.
None of this to say personalized marketing is bad, in fact it’s what your customers want because, if it’s done well, personalized marketing saves them time by providing just what they need, when they need it.
What do you need to make one feel like the other?
To make your marketing personalized, you need 2 foundational things.
#1 An understanding of your customers
This is where customer research comes in. Do you know their pain points? Do you know what they were feeling when they first knew they had a problem they needed to solve? Do you know why they chose your brand over another?
#2 First-party data
Data sounds very technical and impersonal, but it is the foundation of being able to build true relationships with your customers.
What are the benefits of personalized marketing?
A better customer experience
The basis of both personal customer experiences and personalized marketing is trust. When we feel someone gets us and what we need, we are more likely to trust them when we need a solution.
When you personalize your marketing and show your customer that you understand them, then the dynamic shifts from simply buying a product online to a relationship.
Like all relationships, it takes time to build trust, but if you keep delivering the right message at the right time, your customers will learn to trust your recommendations and come to you when they have a need.
Increased customer loyalty
As we mentioned, when you build trust with personalized marketing, customers are more likely to come to you to solve their problems.
“80% of consumers are more likely to make a purchase when brands offer personalized experiences”.Epsilon
Much like mothers in town didn’t mind paying more in exchange for the feeling of being a “regular” at the local baby store, if a customer feels like you get them and you save them time by offering what they need at the right time, they are less likely to search elsewhere for products. Instead, they’ll come straight to you.
A better ROI on marketing spend
We all want more revenue out of marketing spend. When you send out generic marketing messages, the majority of recipients won’t have a need for the product and will tune it out completely. Whether you’re sending the message through email or paid advertising, it all equates to wasted marketing spend.
On the other hand, personalized marketing delivers 5 to 8 times the ROI on your marketing spend.
What are the challenges of personalized marketing?
Collecting and Utilizing Data
Data can be tricky. You need it to personalize your marketing and make the buying experience better for your customers, but getting it and knowing how to ask for it can be difficult.
You can get behavioral data from analytics and first-party data contact profiles from software like RAEK which automatically builds first-party data profiles on your website visitors. But how do you get the rest of the information?
You ask for it.
The narrative of how you ask for information can be tricky and will require testing to see what works, but most customers are willing to provide you with information. 83% of consumers are willing to provide personal information in exchange for a personalized experience.
You can ask for the data through email, with onsite quizzes, or with post purchase surveys.
The other challenge businesses face is data debt or quick access to usable data. 78% of businesses struggle with not having access to the quick data they need to send relevant personalization messages to customers.
The gap in being able to access customer data on third party platforms is widening and making personalized marketing difficult for many.
To combat data debt, you need an app or platform providing real time access to usable customer data.
Achieving the Right Feeling with Personalized Marketing
If you don’t do it right, personalized marketing can be downright creepy. 75% of consumers say they have never had a brand experience they thought was too personal or invasive.
So most people are doing it right. When it does happen, though, the main culprits are usually messages related to a consumer’s current location or product ads that follow you around the internet after you view a product one time.
Personalized marketing can be resource intensive, needing people, time, and money to achieve. As personalized marketing has grown in popularity, solutions for businesses of all sizes have popped up. Whether you own a small business or work at an enterprise level company, there are first-party data solutions that match your resources available.
Creating a personalized marketing strategy
Figure Out What You Need to Get Started
Personalized marketing at the enterprise level usually requires a team of people including data scientists, tech people, designers, customer researchers, etc. That is out of reach for most businesses, though. Smaller businesses need a plug and play software to collect, organize, and help them utilize first party data quickly. Look for a solution which integrates with your ESP (Email Service Provider or CRM and allows you to quickly use customer data in your marketing.
Collect and Organize Your First-Party Data
If you chose a solution in step one which both collects and organizes, you’re good to go. To aggregate data from multiple sources, you’ll need a CDP, which can get pricey. Think about the kind of personalization you want to achieve and see if this is really necessary. Make sure you know what data you need and only collect that data. Collect data you won’t or can’t use is a waste of resources.
No matter how you collect data, make sure you honor privacy and are transparent about how the data is going to be used. As we stated above, customers are willing to give you their information if it is going to make their experience better. Tell them that and honor their privacy.
Segment, Segment, Segment
Personalization comes down to segmenting customers. After you’ve collected enough customer data, you can segment your audience into groups based. Groups can be as simple as demographics or customers who have or have not made a purchase. Or they can be based on product interests, order value, or how often they make purchases.
Start small and then work your way towards deeper levels of personalization. Test everything. Make sure you actually are hitting the right customers with the right information.
Decide How You Will Personalize
Most marketers personalize email marketing because it increases engagement significantly. However, you can also personalize advertisements or your entire website. Decide which channel you want to personalize, the data and tech stack you’ll need to do it, and get started.
Wrapping it up
While personalized marketing will never reach the warm and fuzzy feeling of having a personal relationship with a small business owner, it will build trust, deepen the relationship your customers have with your brand, and provide a significant return on investment. You can get started today by collecting first party data and segmenting your customers.
Need help? We’d love to talk to you about your first party data strategy. Contact Us.
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