In this competitive digital space users have quick access to lots of information. To stand out from the crowd you must provide a smooth and memorable experience to your users. To do so you must personalize the experience for your users.
McKinsey’s study supported this quote by saying that “71% of consumers expect companies to deliver personalized interactions. And 76% get irritated or frustrated when it doesn’t happen”. This highlights the importance of personalization in digital marketing and why we should use it in our strategies.
In this blog, we’ll learn the power of personalization in digital marketing and strategies for using personalization to boost conversion and enhance user experience.
Power of Personalization in Digital marketing
The aim of personalization is to customize messages and content for each customer based on their preferences, interests, needs, etc. it enhances the user experience and increases engagement and conversion rate. It also enhances the retention rate. A study published in Harvard Business Review in 2015 stated that personalization can reduce acquisition costs by 50%, increase revenue by 5-25%, and improve efficiency by 10-30%.
By understanding customer preferences and interests you can create a better user experience. Netflix uses personalized recommendations on the basis of the viewing history of the users. Similarly, Starbucks has implemented personalization through mobile apps, which allow users to make customized orders, earn rewards, etc. It also helps in building customer loyalty.
To implement personalization you need data that can be collected through Google Analytics, social media insights, etc. You must analyze the data to make smart decisions. You should consider the demographic data, browser behavior, social media interactions purchase history, etc for creating the strategy. Personalization is very important because it enhances conversion rate and engagement rate, encourages customer loyalty, helps in gathering more interesting customer insights, and provides a smooth user experience.
Strategies for Using Personalization in digital marketing to Boost Conversion and Enhance User Experience
Here are some of the strategies for using personalization on your website
- Content: Customize the content of your email or website based on the user data you have collected. Such as you can change headlines, images, designs, layouts, product recommendations, etc to match the user’s interests and behavior.
- Landing Page: Landing page can be customized for different users to grab their attention. These landing pages are created in a way that they align with the user’s interests and needs. For example, you can redirect users who clicked on a particular product page to a landing page that aligns with that product.
- Behavior targeting: Behavior targeting uses data of users’ online data to create customized content and campaigns. Browser cookies are one way to do so. It helps in tracking user activity across websites.
- Remarketing: Remarketing is used to re-engage users who previously interacted with your brand but did not complete the action. By using pixels and cookies you can create personalized campaigns to retarget these users.
- AI-based personalization: Use machine learning to analyze user behavior. Chatbots can offer personalized recommendations and offer unique solutions to the problems of the users. AI also helps in predicting user behavior. To understand user language and intent you can use Natural Language Processing (NLP).
Case Study
Netflix: Since 2007 Netflix’s revenue has grown by almost 30 billion USD when they switched to subscription-based video streaming services. Netflix offers recommendations based on user search history, preferences, content consumed, etc. They have an advanced algorithm and data analysis that helps it in making this possible. It also conducted A/B tests to see which personal recommendations are working and which people are willing to watch it.
Spotify: Spotify launched a ‘Spotify Wrapped’ campaign that provided users with a year-in-review that shows them which artist, song, and music they have listened to the most. It encouraged users to share their personalized summaries with others on social media which enhanced the engagement rate as well the reputation of the brand. It also helped in fostering brand loyalty. Other companies such as Duolingo also created a similar method. In addition to this, Spotify also released an AI DJ, which is a personalized AI guide that knows your music preferences and knows which song should be played next to keep you engaged.
Sephora: It created online profiles for customers to share beauty preferences. Based on the profiles, it recommended products to them. It also used personalized emails that had exclusive offers and content. It had a loyalty program wherein users get a reward point whenever they make a purchase.
Personalization helps in increasing customer loyalty, conversion, and engagement rates. It also enhances the online reputation of the brand and helps in attracting new customers. You need user data for creating such strategies. Lumia 360 has designed personalized campaigns for our clients that have increased their lead generation and conversion rate. If you’re struggling with creating a personalized experience for your users, we are here to help with our wide range of digital solutions we can create a similar campaign for you to boost your revenue and engagement rate.
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