Personalization is one of the most important success factors in email marketing. Most companies already know that and therefore focus increasingly on more "mature" email marketing measures, such as customer intelligence emails with the inclusion of Business Intelligence and clickstream data from the web shop.
In general, however, personalization is not a new issue. In fact, the mantra "the right content at the right time, in the right place" is in demand for years.
Nevertheless, it still falls short of implementation: Personalization is in practice often not more than "better" segmentation. A truly personalized communication, however, manages to have a completely individualized dialogue with each customer.
The technical challenge is to map first the process of data collection, information and knowledge production, as well as the transfer of this knowledge into concrete communications measures in an automated closed-loop. Secondly, methods to collect, declassify and consolidate the needed content from various sources efficiently have to be created for an individualized communication. Therefore, marketing automation is increasingly becoming a key success factor in the use of highly personalized dialogue instruments.
Super personalization requires authentic communication
A dialogue is only lasting if it addresses the customer on a personal level, therefore demanding authentic and empathic communication, instead of offensive advertising. Email marketing makes it possible to carry out a sustained dialogue with the customer throughout the entire customer lifecycle, especially due to its extraordinary effectiveness and efficiency in the digital marketing mix. However, a personalized customer approach means individualization rather than broadcasting. Top performers opt, for instance, 1.5 times as often for personalization as other companies, stated Gleanster, and case studies show more than 500% higher opening rates and more than 90% higher click-through rates with personalized newsletters, according to Marketing Sherpa.
Companies have in general recognized the need for personalized communications, as one of the latest studies of artegic proves. In the company’s report, “Online Dialog Marketing in Retail 2016”, artegic claims the use of more "mature" dialog-marketing activities will continue to grow: Already 34.4% of the companies they surveyed use completely individualized emails, based on purchase and click profiles, further 46.6% are planning to use them. Besides, 25.9% rely on customer intelligence emails (e.g. use of business intelligence and clickstream data from the web shop), 37.6% trust in lifecycle mails that are expected to be 74.6% and 79.4% in the future. Unfortunately, the focus of many companies is still on segmented mass mailings with different advertising for each target group (67.7% use them) and 33.3% even send still mass emails that are not segmented at all.
Super personalization rather than pseudo-individualization
From the user’s perspective, individualization means receiving relevant content at the right time and right place. As said, that is an often repeated mantra over the years and apparently nothing new. Hence, the requirements for personalized communication are in principle well known, but the implementation often fails due to personalization or customization being often not more than addressing someone by name. However, truly personalized communication must be more than a “pseudo-individualization”. It requires carrying out a completely individualized dialog with each user who receives the most wanted and appreciated content that meets his current needs at any point of the customer lifecycle.
However, for each form of individual approach, data is needed first, which users are often leaving behind at various contact points, such as response data from the marketing email, transaction data from the online shop, or use data of other marketing tools. In addition, there are offline data, for example, from PoS systems.
Be aware, however, that consent of the recipient is required to be able to collect and use this personal information, which is as well a technical challenge, as it calls for the establishment of a data usage management. By structuring and assigning the data to a customer’s profile, useful and exploitable information is created in the form of a question such as “What products did the customer buy and when? What kind of content does the customer click or not, and what? Which socio-demographic characteristics are featured?” and gets answered.
By using analysis methods, for example, insights can be gained from the data about consumer preferences and behavior, through the data mining process, or correlations between different characteristic values. It is important to anticipate this knowledge and to convert it into operational dialog measures, for instance for cross-sell / upsell or loyalty measures.
Going through these measures in turn generates new data and develops a closed loop circuit: Customer knowledge is build-up successively when aligned to customer needs with up-to-date communication. It can steadily be optimized by using analyzes and CRM, since the processing is not practical to handle manually, making marketing automation technology somewhat mandatory.
Challenge of content processing
Apart from the pure data perspective, individualization contains another challenge: Individualized communication requires a number of matching, granular content. The finer the individualization turns out, the more specific this content needs to be, and the more individual fragments are needed. For many companies this is still no easy task, although they dominate the data screening. Often they cannot effectively use the findings, as there is not enough content available or a lack of resources to process existing material. In fact, the required content often already exists in the company, although scattered across different areas. An inter-divisional, cross-functional use often needs to be implemented efficiently and the manual transmission of repeatedly revised Word documents via email distribution is still the norm. The goal is to establish processes for capturing, sharing, and merging of content from various sources. However, only by means of marketing automation technology is it possible to implement content processing economically, so that marketing automation becomes a key success factor in the use of highly-dialog instruments.