It’s unanimous. Both consumers and businesses agree that marketing personalization plays an important role in the relationship between brands and their customers. In fact, 71% of consumers say they expect it.
It’s no surprise that ecommerce personalization has been cited as one of the top retention strategies used by brands. But what is personalized marketing? And how can new brands hop on the trend to meet customer expectations and drive growth?
Ahead, learn why adding personalized experiences to your marketing strategy can be beneficial to your brand, and explore tactics and real examples you can implement today.
What is marketing personalization?
Marketing personalization is the practice of using data to create unique experiences and tailored interactions with a brand. Brands collect user data through a number of means to help understand individual customer habits, preferences, and traits in order to deliver personalized content, marketing messages, and experiences.
While adding a customer’s name dynamically to a static email newsletter could be considered personalized marketing, the practice has come a long way, thanks to technology. Facial recognition tech in retail stores and AI chatbots that learn a website user’s habits to make smart recommendations are just two such examples.
More and more, brands are combining consumer data with personalization tools to reach customers with the right messages at the right time. The trend continues to grow, with the personalization software industry expected to be worth $11.6 billion by 2026.
Why should brands use personalized marketing?
The most compelling argument for using marketing personalization is its potential to drive up to 25% of a brand’s total revenue. Audiences are more likely to convert when they are delivered messages, ads, and experiences that meet their specific needs.
As consumers become accustomed to receiving personalized marketing, one study found 62% of those surveyed said a brand would lose their loyalty if it did not deliver a personalized experience.
Personalized marketing may cost a brand more time or money to execute, but the return on investment (ROI) justifies the effort. Sending generic and static messages won’t resonate with a diverse audience—targeting potential customers with the right products or tailored messages means there’s a better chance to engage them.
The benefits of a personalized marketing strategy
Consumer trends indicate personalization is here to stay, and a successful personalized marketing strategy can offer the following:
- Better customer experiences. Your potential customers won’t have to cut through the noise if they’re served products, deals, and ideas that match what they’re searching for.
- Improvement in customer loyalty and trust. 88% of consumers say trust is an important factor in deciding to purchase from a brand.
- More authentic connections with customers. 92% of Gen Z consumers surveyed say authenticity is extremely important.
- Increased ROI. Personalized marketing can offer up to eight times the ROI compared to other types of marketing.
7 marketing personalization strategies
Whether you’re trying to attract prospective customers or reengage existing ones, personalization is a must-have in your digital marketing playbook. Add these marketing strategies to the mix to help meet your business goals.
1. Segment and personalize emails
Segmenting your email list can help you send relevant content based on where each subscriber is on the purchase journey. For example, if visitors have abandoned their cart or searched without making a purchase, remind them where they left off with personalized content.
These examples from Hotwire (note the personalized subject line, too) and Alo demonstrate how to reengage browsers.
You can also send personalized emails to existing customers, with product ideas, rewards, and deals that relate to their past purchases, like this example from Altitude Sports.
💡Tip: If you run your store on Shopify, take advantage of the features offered by Shopify Email. Power up your email campaigns with personalization, segmentation, and automation.
2. Deliver personalized product recommendations
Product recommendations can be part of your strategy to increase customer engagement, improve conversion rate, and drive repeat purchases. Use purchase history from existing customers or behavioral data collected from wishlist saves and browsing habits to surface relevant products through email or on your website.
This example from Good Robot Brewing Company suggests related items on product pages, helping to improve cross-selling.
Shopify’s enhanced storefront search and product recommendations use machine learning models to produce better search results and auto-generate recommendations. Marketing automation tools like those found in the Shopify App Store can add additional functionality.
3. Gather zero-party data through engaging experiences
With tightening privacy rules—think the General Data Protection Regulation (GDPR) in the European Union and Google phasing out third-party cookies—brands must be increasingly careful about how they collect and use customer data.
Third-party data providers offer unique insights, but they can cost you. And while first-party user data (data collected by user website behavior) can be useful, brands should consider collecting zero-party data to better understand their customers.
Consumers are more likely to give a brand their data if they trust it or they receive value from the exchange. Collecting data can be done through lead capture forms or more customer-friendly approaches, such as onsite quizzes. These often ask a user for their preferences, followed by an email opt-in with the promise of delivering tailored recommendations or sizing.
This quiz by Bright Cellars asks questions that provide valuable data to the brand—and helpful suggestions to improve the customer experience.
Promote your quiz through social media marketing or email campaigns, like this example from Verve Coffee.
Use apps that integrate with your ecommerce store to create personalized experiences in your marketing efforts. Here are a few recommendations:
- Shop Quiz: Product Recommender
- Grapevine Post Purchase Survey
- Quiz, recommendation & emails
- Kiwi Size Chart & Recommender
4. Send targeted discounts and deals
Encourage repeat purchases by sending targeted deals based on customer behavior. Use discount apps to generate unique codes or exclusive discounts based on specific customer traits.
In this example, intimates brand ThirdLove is using data provided in a fit assessment to recommend products and send targeted discounts through personalized emails.
5. Set up a loyalty and rewards program
One effective personalization strategy is the use of loyalty and rewards programs. These programs incentivize customers to provide data and engage with the brand. Effective programs make customers feel like they are part of a community with perks like a points program, exclusive deals, and events.
In this example from Sephora, both the brand and customer benefit when customers complete a skin care and beauty preference profile. Customers receive more tailored deals (products and brands that match skin tone or skin concerns), and Sephora gains valuable data about its customers.
When customers opt in to Sephora’s Beauty Insiders reward program, they receive personalized experiences and offers within the app, through marketing messages, and online.
Swim brand Seafolly also uses the loyalty program method to deliver benefits to customers through a tiered points system that unlocks perks at every level.
Casetify uses SMS marketing to urge new customers to join the brand’s loyalty program.
6. Use AI to understand customer behavior
Many personalization tools use artificial intelligence (AI) to both collect customer data and deliver better experiences. This is a great option for small brands without a robust customer service team. AI tools can understand website behavior to deliver better onsite recommendations and trigger SMS, social, or email marketing messages at the right times in a customer’s journey.
Examples may be:
- A customer service chatbot that provides support and suggestions based on the user’s inputs. These inputs can also be used to generate follow-up marketing messages.
- An AI personal stylist that assembles looks based on a fit and style preferences quiz or chatbot responses.
- A/B testing automated personalized marketing SMS messages, push notifications, and email subject lines to determine which perform best.
- Dynamic website views that show different users different versions of a website, perhaps showing specific deals in a homepage banner that are most relevant to their search and purchase behavior.
Maqio Toys uses an AI chatbot to not only answer customer service questions but the tool also suggests sales and makes personalized recommendations.
Happy to Meat You’s AI app detects when a user may be leaving the site and delivers a pop-up offer prompting them to stay.
7. Use location-based marketing
Location-based marketing or geotargeting is the practice of using people’s geographical location to deliver relevant marketing messages. You can use location-based settings through Google ads, Facebook ads, and other ad platforms to deliver messages to specific cities or even postal/ZIP codes.
Create personalized campaigns that use local slang, reference local landmarks, or even offer deals based on the weather. For example, a café could run ads for hot coffee on a cold day, and cold beverage options on a hot day. Tools like WeatherAds and Meteonomiqs can sync with your marketing efforts to automatically deliver weather-appropriate ads to users within specific locations.
Personalized marketing examples from top brands
Many top brands have long used personalization in their marketing campaigns—and it’s a trend that’s catching on among smaller brands, too. Get inspired by these examples of global brands’ successful personalized marketing campaigns.
Spotify Wrapped is a popular annual campaign that delivers each user of the music streaming service a data-driven snapshot of their music listening habits for a given year. This campaign delivers huge social media engagement for the company and encourages users to revisit the platform to listen to old favorites or discover new tracks.
💡 How your brand can use this idea: Send a personalized email with a recap of each customer’s favorite products, top-searched categories, and recommendations.
Nike by You
Formerly Nike ID, the campaign and product line of fully customizable sneakers underwent a rebrand in 2019, with more focus on the customer’s unique identity. Site visitors can customize classic Nike sneaker designs with their own colors, materials, and even a monogram. Over 130,000 customers have used the #nikebyyou hashtag to share their creations on Instagram, resulting in free social media marketing for Nike.
💡 How your brand can use this idea: Offer a customizable product or experience and promote it to consumers based on preferences and seasons. For example, promote garden totes with customizable embroidered messages or names for Mother’s Day or Father’s Day.
Coca-Cola Share a Coke
Coca-Cola’s Share a Coke initiative launched across multiple regions globally following a successful campaign in Australia in 2011. The personalized campaign’s first version featured popular first names printed on bottles of soda, prompting customers to seek out their own name. The long-running campaign eventually expanded to nicknames and song lyrics.
💡 How your brand can use this idea: Consider your customer personas. Can you create collections on your site that appeal to these personas and market them to specific customer groups? This idea works best during holiday gifting seasons through gift guides designed around specific types of gift recipients.
Customer data, privacy, and personalization
One study found that 74% of consumers say they value their personal data, and 82% are concerned about how companies are using it. Aside from customer hesitation around sharing their data, there are policies and laws that govern how it's collected and used.
GDPR imposes tough penalties for companies that violate its terms. In other regions, data protection regulations like the Consumer Privacy Protection Act in Canada and various state-specific laws in the US govern the way companies can conduct data collection and use customer information.
💡Tip: To give customers peace of mind (and avoid getting into legal trouble), clearly state your privacy policies and data protection measures in your terms of service.
Drive conversions with a successful personalized marketing strategy
Whether your marketing team is running localized ads on social media or using personalized email marketing to reach customers at the right time in their journey, personalization can be a powerful tool to help you win customers and keep them for life.
Customers expect personalized experiences, and when you meet their needs, you can reach them on a personal level and improve their buying process. These efforts go a long way to building relationships and loyalty—and ultimately driving more sales.
Marketing personalization FAQ
How effective is personalized marketing?
Personalized marketing is proven to be a successful digital marketing strategy for achieving business goals like increasing customer engagement, improving customer experience, capturing data, and driving repeat purchases. Marketing personalization efforts have the potential to drive up to 25% of a brand’s total revenue.
What are the types of personalized marketing?
Personalized marketing comes in many different forms, from strategies as simple as customizing email subject lines or as complex as using AI to capture user data and deliver personalized experiences on a website or in-store. Your marketing campaign could benefit from a number of personalization types, including tailored content based on purchase history or marketing messages, ads, and website content specific to a user’s location.
What are the best marketing personalization tools?
There are many marketing automation and personalization tools for all sizes of brands. These include customer relationship management software and AI marketing technology. A data management platform can even be considered a personalization tool.
When developing your personalized marketing strategy, consider using tools that help you capture data, run automated campaigns, and offer robust analytics to measure your success. Some examples include: