Content personalization, the strategy for delivering relevant and targeted content based on what interests your audience, is instrumental for engaging customers on an individual level. Providing tailored recommendations to customers is the difference between sales and great sales. For marketers, getting this right is extremely important and valuable.
To bring this to life, I recently spent some time browsing Chinese online shops to learn more about the way they were trying to keep me on their website and drive me to complete a purchase. As you may guess, some did a much better job than the others…
By browsing their websites, I was able to learn a lot about the differences between the various methodologies and algorithms that different solution providers use to customize the online experience and make product recommendations.
In this article, I will share the ideas behind the personalization engine, elaborate about different kinds of solutions available, and sum up with few tips.
How Does Content Personalization Work?
Content personalization is valuable for marketers who strive to engage customers on an individual level. The reality is that customers now not only prefer content that is tailored to their needs, but they expect it.
It’s not a new process by any means. Marketers and their brands have been building their content efforts around customer profiles for years. The defining difference in modern content personalization is that customer data and technology drive the process, and it’s more refined and effective than it has been in the past.
Building customer profiles and segmenting your audience is the backbone of any content personalization strategy and having a wide range of customer data to start with makes it all the more effective.
The 3 Pillars of Content Personalization
There are three pillars that your brand must start with and build around, if you want to create a successful content personalization strategy. In order to get the results you desire you will need to understand and execute along each step of the way. We explain each, in detail, below.
1. Capture Customer Data
This is the easy part, but it is undeniably crucial to your strategy. Capturing data starts with adding the necessary code to the backend of your webpage. From there, you can collect data points like clicks, abandoned shopping carts, purchase history, and more.
2. Analyze It
Capturing data is where everything starts, but your analytical capabilities will determine how valuable it proves to be. Taking an analytical approach will allow you to create customer profiles so that you can categorize users and provide them with targeted content, the stuff they are looking for.
3. Act On Your Insights
After collecting the data and analyzing it properly, it’s time to rebuild your marketing strategy. Your customer profiles will be a guiding light, but the machine should still do the heavy lifting. Personalized content should work in tandem with the buyers journey, helping you connect with customers each step of the way.
Capturing data, building analytical capabilities and acting on those insights are all beneficial to an organization on their own. When these three pillars synchronize and work together the highest revenues and return on investment (ROI) can be achieved.
All of the online shops I’ve recently visited have a personalized content widget on their website. In many cases, I had little or no interest in the content displayed.
Putting my personal online experience aside, the most important question to ask is:
‘How is it that some online shops generate amazingly high CTR and revenue from personalization widgets while the others don’t?’
Here comes a spoiler from Game of Thrones season 4, chapter 3.
In a scene of high drama, the head of House Lannister, Tywin, approaches his grandson, who is about to be crowned King and poses him a question: “What makes a good king?”
The 16-year-old tries a number of answers before, on the fourth attempt, getting to the answer. “Wisdom,” he replies. Tywin smiles, satisfied with the answer.
Like kings, powerful personalization engines use wisdom to affect the outcomes they want.
Finding the Right Content Personalization Solution
Technically speaking, capturing and acting are the easiest parts. Analyzing the content to create meaningful predictions and the most accurate predictive results is what makes the difference. This is the real wisdom.
The practice of data analysis to create these predictive ‘rules’ remains in its infancy and it is this activity that will really make the difference.
It’s no secret that marketing teams everywhere struggle to find the right solutions. Based on my research and time spent browsing Chinese online shops, marketers have the following options:
- In-house solutions are by far the most popular among Chinese online shops. This popularity is driven by the fact that there is no need to share data with third parties. However, more often than not, the internal solution’s functionality only extends to simple matching, lacking the advanced mathematics that creates valuable insights. Without a strong and sophisticated algorithm, there may be very little improvement, if any at all. As talented as the internal IT team is, we have to acknowledge that building a sophisticated, self-learning algorithm is a “don’t try this at home” task.
- A third-party solution will base its calculation on a big pool of data; a good starting point for the ‘three pillars’ circle. This may be especially attractive to a small-sized company that lacks the depth of data to make its own calculations, but – and this is a big ‘but’ – capturing data from company X and use it for the benefit of its competitor, company Y, is very problematic. Additionally, unless all of the companies sharing their data are pushing similar product lines, insights will be vague and almost meaningless.
- A third party will only capture and analyze from the owner’s own website creating insights only on the customer’s own dataset. If done properly, your consumers will enjoy the most accurate calculation of content personalization and this has been proven to drive stronger purchase behavior. Customers ‘return the favor’ and acknowledge the effort put into personalizing their experience with better sales performance. This approach also mitigates any data sharing or security issues.
If you are not using any kind of content personalization or recommendation engine, you should be. It is proven to drive sales.
If you are delivering some kind of personalization or recommendation experience you can, and should, perform a comparison between your existing solution and any other solution that claims to be able to add greater value.
Implementing a Personalization Engine
The implementation of this type of solution is fairly simple (requiring only lines of code to be added to your webpages) so experimentation should be possible. Typically, once ‘coded in’ the machine learning algorithms then start to capture data (products clicked, time on website, abandoned shopping cart, purchase history, etc.), and after two or three weeks, the machine should be able to push back relevant content recommendations to your consumers.
At this stage, you may run an A/B test validating the performance of systems versus some kind of control. Both machines will run parallel on the backend and the website widget will display each machine’s calculation results 50% of the time. In doing so you don’t need to change your website design just in order to have the A/B test, and there will be no impact on the user’s experience.
Most of my customers and friends say that data security and cost are the most important aspects they consider while comparing internal solutions versus third-party products. Often, customers end up opting to develop in-house solutions because they feel the risk of sharing data with external parties is too great. I have great respect for this position and I truly understand their concern. However, the extremely high cost of building an internal solution, coupled with (in my experience) their relatively poor performance makes me feel that a reliable and trustworthy third-party vendor is still the best solution. Third parties are simply more able to provide fantastic ROI.
Back to Game of Thrones – as Tywin Lannister said:
“A wise king knows what he knows and what he doesn’t. A wise young king listens to his counselors and heeds their advice…”
There is increasing demand for personalization across the customer journey. If you’re looking to revamp your content personalization capabilities and are interested in moving forward with a new personalization engine, Emarsys can help you save tremendous amounts of time all while improving the results of your omnichannel marketing campaigns.
➤ See how Emarsys can help you segment your audience and create a truly personalized marketing strategy.