Understanding Different Applications for Personalization

By on January 24th, 2012

“Personalization” continues to be a prominent topic in a number of different circles: marketing, publishing, eCommerce, social networking, and search. It’s no wonder why: personalization helps boost response rates and profitability in cross-media campaigns, helps marketers drive conversion on their Websites & landing pages, and much more.

Wikipedia provides a very broad definition of personalization, which I do like: “using technology to accommodate the differences between individuals.” Specific to the groups that I am referring to, I believe that personalization can be more precisely defined as leveraging data to deliver relevant content to specific individuals.

That’s still pretty broad; what kind of data? what kind of content? what channels are being used? With this many constituencies looking to use personalization in their own ways to meet specific goals, those answers can range extensively. Furthermore, when these groups end up talking to each other about personalization, it can cause confusion and miscommunication. To clear the air, so-to-speak, I wanted to shed some light on the different ways personalization is being employed by these different groups.

  • Cross-media Direct Marketing: You’re likely familiar with the personalization model for cross-media campaigns: a digitally-printed direct mail piece (or e-mail) with variable text and graphic elements and a personalized URL, which links to a personalized microsite with variable text and graphic elements, often highlighting the recipient’s name in some way. Personal and demographic data is primarily used to drive the personalization in these applications. Depending on the client/campaign, additional data may be used for more granular, relevant content.
  • Digital Marketing: Personalization is popular with digital marketers. E-mail is a popular spot for personalization: according to a 2011 study by marketing technology provider Alterian, 72% of marketing professionals surveyed reported using personalization for their e-mail campaigns. E-mail marketing complexity ranges from mass blasts to segmentation to real-time individualization, typically using customer data and purchase history data to make recommendations. Another prominent personalization tactic for marketers is retargeting, which involves serving ads to a specific user after they have left a Website in efforts to raise brand awareness, recapture their attention, and drive people back to their Website.
  • eCommerce: Business-to-consumer eCommerce was and still is a center of innovation in Web personalization, driven by Amazon.com and other eTailers looking to provide a custom-tailored experience for each individual user in hopes of getting them to buy more. For these sites, personalization often comes in the form of a recommendation engine, which tracks your browsing habits, shopping cart, wish list, reviews, purchase history, and other facets to deliver personalized recommendations on what the system thinks you would like. It should be noted that digital marketing goes hand-in-hand with eCommerce; real-time individualized e-mail marketing is common for eCommerce companies, and retargeting helps bring back shoppers that left the conversion funnel.
  • Publishing: For print publishing, personalization often means mass customization, specifically in the print-on-demand model for books, where eCommerce orders trigger specific books to be printed, often in one-off fashion. Services like MagCloud and Time Inc’s Mine Magazine endeavor represent personalization efforts for magazines. On the Web and in digital media, personalization is geared more toward delivering relevant content based on an individual’s specific interests or preferences. Sometimes meeting this objective requires readers to input specific information about their tastes; other times, information like a Twitter, Facebook, or Google Reader account may be analyzed to assess your interests and deliver content based on who you’re friends with, who you follow, or what news you already read. A great example of this method is exhibited through Zite, a “personalized digital magazine” mobile app.
  • Social Networking: Social networks are rife with different types of individuals’ data, making them ideal for personalization. Social networks typically employ personalization to deliver relevant content feeds from a user’s friends or connections on a network, as well as to deliver highly-targeted display advertising. For content delivery, networks may use algorithms to interpret connections, interactions, and profile information among users and deliver content based on what it believes is most relevant to each user. For advertising, networks typically act a facilitator between advertisers and users, presenting key profile characteristics of users that advertisers can choose to target.  Facebook generated over $3.5 billion in revenue through this type of advertising.
  • Search: Search engines have always utilized algorithms to determine the display results of a user’s query, but these algorithms have recently started to take user information, such as profile or location data, into consideration before displaying results. Just recently, Google stepped up its game in this area, launching “Search, plus Your World“, which integrates a user’s Google+ data into everyday search queries. Advertising is a critical component to search, and generated over $35 billion in revenue worldwide for Google in 2011. Up until now, most search ads have been delivered based on the content of users’ search queries, but location information and even personal information are starting to be used to deliver more targeted search ads to users.

At its core, all that is needed to enable personalization is data, content, and a mechanism to have one drive the other. As has been covered, applying personalization for different use cases has a substantial impact on the type of data being used, the content that is being tied to that data, and the types of delivery mechanisms that enable that personalization. Understanding these differences and requirements for each application can help different stakeholders communicate more effectively when pursuing personalization, as well as open the door to new opportunities

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    One Response to “Understanding Different Applications for Personalization”

    1. Kit Hamilton Says:

      Thanks Bryan. One of the coolest advances in recent years has been the integration of predictive analytices and rules-based engines with communication platform. In a sense, that “best-next-action” that has been common in e-commerce (i.e. Amazon) is now taking shape in call centers, onboarding, retention efforts and transpromo billing. Perhaps the next big wave in personalization will involve true preference management — where you receive every communication in the precise format/channel you prefer. In the end, personalization is always key! Kit Hamilton | Pitney Bowes Software