Inside Personalization: The Power and Promise of Message Customization

The business landscape is changing, and changing fast. New technologies keep emerging. New customer behaviors keep surfacing. And we’re fast approaching the point where having a one-to-one digital connection with your customers isn’t going to be a nice-to-have; it’s going to be the only way to build a sustainable customer/brand relationship.

"To break through this fog of outreach, brands must demonstrate through thoughtful, relevant messaging that they can provide real value to the people they’re trying to reach. And to do that, you need personalization."

How We Got Here: Engagement Overload and the Personalization Solution

The transformational growth of new technologies—from the rise of the World Wide Web to mobile’s explosive, unprecedented global adoption—has fundamentally shifted the contours of daily life. Today, it’s the rare person who goes about their day without a smartphone on hand, and many report being so attached to their devices that they feel uneasy when they’re not holding them (which may be why so many folks insist on sleeping with or near their phones).

Because so many carry their phones on them basically at all times (and because those devices include GPS and a wealth of nuanced sensors), it’s now possible for companies to gather more—and more detailed—information on their customers than ever before. Mobile and other emerging platforms have also significantly expanded the number of ways that brands have to reach out to their audiences. It’s not just about email anymore, with mobile and web push notifications, in-browser and in-app messages, and a host of messaging options bursting on the scene. (Alexa notifications, anyone?)

That’s a lot of noise. It’s not surprising that many are tuning out most of these communications—even if those messages really spoke to them, the average person would struggle to engage with all of them, because of the sheer volume and frequency. To break through this fog of outreach, brands must demonstrate through thoughtful, relevant messaging that they can provide real value to the people they’re trying to reach. And to do that, you need personalization.

"Personalization initiatives can deliver significant value, including on average 10-30% revenue uplift and higher customer acquisition rates and engagement."

- Julien Boudet, McKinsey

The Promise of Personalization

Here’s the thing about all the data technology has made it possible to collect: it doesn’t have any value on its own. Zip. Zero. Nada. If you just collect it and don’t act on it to better understand or communicate with your customers (or wait too long to act), you might as well wheel it into that government warehouse at the end of Raiders of the Lost Ark; it’s not going to move the needle for you or your audience.

When you effectively leverage available data to make your brand experience more appealing, relevant, and valuable to each customer as an individual, that’s personalization. Depending on the situation and your brand’s particular needs, that can mean adding a customer’s name to an email, automatically customizing the content they see on your app or website, or dynamically adding relevant products or news into the push notifications you send, and more. The key is to find the sweet spot where using data to personalize the messaging experience helps your brand speak more thoughtfully and persuasively to customers.

Getting it right can be difficult. But for brands that do, the rewards are enormous—and measurable. According to McKinsey’s Julien Boudet, “Personalization initiatives can deliver significant value, including on average 10-30% revenue uplift and higher customer acquisition rates and engagement.” For a lot of brands, that means that personalization can be the difference between a successful marketing strategy and a failed one. However, Boudet cautioned of personalization efforts, “The key is that they must be done right.” The financial impact that comes with ineffective personalization is major: Research conducted by Accenture found that companies worldwide are losing a collective $1 trillion in annual revenue because their communications with customers aren’t consistently relevant.

So what does that mean for you? Personalization can drive real increases in engagement and revenue, and change the game for your company, your team, and yourself. But if you’re going to do it, you have to fully commit—there’s no partial credit.

That’s a major part of the issue. While smart people at sophisticated brands know that personalization is something they should be leveraging in a big way, an awful lot of them just aren’t. In fact, according to a study conduct by Evergage and Researchscape, 55% of marketers say they lack the data they need to use personalization effectively. And many of the people who ARE using personalization don’t feel confident that they’re doing it well. Only 31% of marketers give themselves an “A” or a “B” on a scale from “A” to “F” when it comes to personalization efforts; a full 46% gave themselves a “C.”

Even worse? Those low grades track pretty closely with the feedback we’re hearing from consumers. According to Brendan Witcher, principal analyst at Forrester Research, while 90% of marketers see themselves as providing personalized experiences in some capacity, only 40% of consumers agree with that assessment. Those numbers get worse when you take a global view of things, according to research conducted by Periscope by McKinsey: while 31% of Americans find the messages they receive from brands to be usually or always relevant to them, only 19% of French citizens, for instance, said the same.

That said, these same consumers have been conditioned to want the interactions they have with brands to be customized. 74% of consumers feel frustrated when they’re served up irrelevant content or promotions on the web, according to a study by Harris Interactive with Janrain, and research by Monetate found that 83% expect personalized experiences from the brands they patronize.That translates into stronger results for brands that fill the need successfully. Research conducted by Braze has found that personalizing messages using Liquid, an open source templating language, boosts push total open rates by 225%* and Gartner predicted last year that companies that invest in a full-spectrum approach to personalization will outsell companies that fail to do so by more than 30% during 2018.

Taking Action: How to Make Personalization Happen

Personalization is powerful, but it doesn’t just happen. To take advantage of this key functionality, you need to be up to speed on the six major types of personalization and the four distinct approaches that support them.

Get up to speed with The Power Behind the Message: The Nuts and Bolts of Effective Personalization, our exclusive look at the nuts-and-bolts of customer message personalization.

*Methodology

This analysis by Braze Research measured engagement in terms of push total open rates (both direct opens and influence opens) in connection with more than 400,000 distinct campaigns between August 2017 and August 2018. Open rates were defined as the number of push opens divided by the number of pushes sent.