Personalization Software: Everything You Need to Know in 2022 and Beyond

Srikant Kotapalli

Mar 30, 2022

Srikant Kotapalli

Mar 30, 2022

Here’s what Insider has done to uplift personalization for some well-known brands:

  • Increased ROI by seven times for Yves Rocher in under five months.
  • Increased a conversion uplift of 123.5% for MAC Cosmetics through onsite optimization.
  • Increased average order value by 35% for Phillips using personalization.
  • Increased online sales by 12% uplift for Lenovo

Personalization software market size was at $620.57 million in 2020 and is expected to reach $2.2 billion by the end of 2026.

What’s behind this growth?

What makes personalization one of the biggest modern marketing trends?

Check this out:

Statista says approximately 90% of consumers find the idea of personalization appealing. 71% of consumers prefer to buy from a company that tailors its approach to them.

56% of customers will return to a website that recommends products relevant to their needs.

With the help of personalization software, retailers today are searching for the best ways to meet their audience’s needs and provide better customer experiences.’:

Tapping into this growth is a must for modern companies. In fact, fast-growing companies drive 40% more of their revenue from personalization than slower growing companies. 

Table of Contents
  1. What Is Personalization?

  2. What Is Personalization Software?

  3. How it Works

  4. The Benefits for Marketing

  5. The Importance of Using Personalization Tool

  6. How Companies Use Personalization Tools

  7. Attributes of an Effective Personalization Software

  8. FAQ

What Is Personalization?

“Good marketing makes the company look smart. Great marketing makes the customer feel smart.”

— Joe Chernov, VP Marketing, Pendo.io

Personalization is a marketing strategy where brands use data analysis and digital technology to deliver personal messages and offers to customers.

What does this mean?

When you shop on sites like Amazon, as you click on a product page, you’ll see related offers that may also interest you.

When you next log onto the website, you will be shown offers based on your last search items.

These are personalized marketing automation strategies designed to:

  •  Keep users coming back
  • Make it easy to buy products
  • Suggest related products you could also buy

Seventy-two percent of consumers indicate they expect businesses they buy from to recognize them as individuals and know their interests. When asked to define personalization, consumers associate it with positive experiences where they were made to feel special. 

Personalization software is an essential element of the customer experience used to track customer activity and preferences across channels. This tool drives customer loyalty and increases customer lifetime value as a win-win by crafting tailor-made customer journeys and yielding rewards for both the user and the marketer. Using personalization software to improve a brand’s relationship with their customers can also contribute significant uplift for valuable metrics across platforms.  

What Is Personalization Software?

Personalization software is a tool built to monitor customers’ activity, characteristics, and behavior across multiple channels (web, mobile, app) to create a personal customer experience by recommending relevant products or messages based on their activity.

It can be as an extension or a plugin.

The goal of this software is to help your business drive metrics  including:

Remember:

  • Every website visitor has specific needs
  • They are expecting you to meet those needs

Research proves 42% of customers feel frustrated when content is not personalized. Since customer satisfaction is crucial for customer retention, personalization is vital to providing a shopping experience your customers will want to return to.

“Personalization is not about the first name/last name. It’s about relevant content.

 Dan Jak 

To ensure you are targeting relevant customer context, your marketing teams need an effective tool to show customers what they need before they realize it themselves.

Recommended Reading: Website Personalization Best Practices

Personalization is the same as A/B testing.

While personalization involves A/B testing to analyze and demonstrate added value and uplift from campaigns, it is not the same as A/B testing technology. Personalisation requires a high level of user segmentation and data to provide a unique and tailored experience for each user. Comparatively, A/B testing is a user experience research methodology that does not necessarily require user segmentation  beyond a control group.   

How Personalization Software Works

Personalization solutions automatically modify content based on the characteristics and behavior of customers.

Characteristics are customer data consistent across channels. 

Customer characteristics include:

  • Company
  • Job title
  • First or last name
  • Location

Customer behaviors may not be similar across channels. These include:

  • The pages your customer visits on a website
  • A referral source that brought them to the website
  • An ad that your customer interacted with

Personalization uses this data to provide a unique user experience to each customer, rather than a one-size-fits-all experience.

The Benefits for Marketing

  • Identify Trends

If a customer who often buys gifts from your website changes to buying novels, personalization software will help you identify this shift in behavior and adjust personalized content to send recommendations relating to the customer’s new trend. 

This increases customer loyalty, as the products you offer continue to align with their needs. 

  • Increase Conversion Rate 

Invesp research shows 56% of online shoppers are likely to return if a website recommends relevant products to them.

  •  Improve Customer Experience

Customers are more likely to prefer personalized product recommendations related to their desires. Successfully identifying customer preferences and delivering relevant offers will lead to increased customer satisfaction, which will improve long-term customer loyalty and sales.

Here’s an interesting fact:

Smarter HQ confirms 72% of consumers agree that a personalized shopping experience sparks customer interest. These experiences reduce stress for customers, as they cut down the amount of time spent searching for the right products. There are various ways to provide personalized recommendations to your customers. 

For example: 

  1. A overlay showing an offer related to the customer’s search history
  2. A section showing customers offers related to what they have added to their cart
  3. An SMS showing customers with an affinity for new arrivals a message when products get added to your site

Other benefits

  • Integrates offline and online data
  • Targets specific customer needs with tailored marketing campaigns

The Importance of Using Personalization Software

You can get more from your campaigns and advertisements by integrating customer data, using the characteristics and behavior of each customer to make relevant and engaging offers.

Ultimate personalization is going into a bar to sit down, and the bartender puts a whiskey in front of you without having to ask what you want.”

— Jeff Bezos

Making your customer feel that you are talking to them alone, and not a group of people all at once gives you a higher chance of converting them to paying customers.

How Companies Use Personalization Tools

Grammarly

Grammarly is a popular brand almost every writer — be it amateur or professional —  is familiar with.

How they use personalization: 

Grammarly corrects grammar mistakes in users’ work and sends tailored weekly reports showing them how their writing has improved.

Grammarly reports include:

  • The number of words the user wrote that week 
  • The number of mistakes they made 
  • How often they made each mistake 
  • Highlights potential areas for improvement

With this feedback, users can improve their grammar skills to get the most value from this product, encouraging them to continue using the service.

Netflix 

Netflix is a popular movie streaming site.

How they use personalization:

In their browsing menu, Netflix has a section labeled “You might also like” which suggests movies and shows to the user. These suggestions are chosen based on data indicating user interest.

Also, they also include recommendation menus with streaming options that are similar to those recently viewed by the user, so they can quickly find more content that matches their current mood.

These suggestions save users from the stress of scrolling through hundreds of titles before finding a movie that interests them.

Cadbury

How they use personalization:

In 2015, Cadbury launched a Facebook campaign in Australia. They used user profiles to match each person to one of the brand’s new flavors, one that paired well with their personality, described as a ‘flavor match’. Then Cadbury used customer profile pictures to create a personalized video introducing the product.

Attributes of an Effective Personalization Software

For a personalization tool to be effective, it must include these features:

  • Recommends personalized offers

Remember that personalization needs to go beyond first name/last name. Effective personalization should be based on relevance to each customer.

Personalization software must be able to integrate customer data such as personal history, touchpoints, keywords, and other behaviors, then use this information to suggest relevant products and offers.

  • Ability to capture real-time data

The software should allow you to capture your customer data across channels in real-time so you won’t miss any important information and can respond quickly to changes in customer behavior and desires

  • Flexible personas

A beneficial personalization software should not only provide you with static data, but give you details about who performed an action, why the action occurred, and when it took place.

  • Integration with AI

Software which effectively makes use of AI technology will allow you to better analyze and predict customer behavior. A clearer understanding of customer behavior will lead to more successful personalized campaigns.

Recap:

Marketing field is growing daily and the competition is fierce. 

Your marketing teams must adapt to the new world of personalization or risk missing out on your share of the profits.

Marketers in B2B companies, eCommerce, physical stores, and many others are adopting personalization tools to create and provide seamless customer experiences.

Sending relevant offers to your customer at every stage of their journey will:

  • Increase customer satisfaction
  • Increase customer retention 
  • Improve customer journey across their whole shopping experience

Over to you:

Now you know about personalization software and the benefits it will bring to your marketing strategy.

Get started right away to keep your company current.

“It’s important to remember your competitor is only one mouse click away.” 

Douglas Warner III, Former CEO, J.P. Morgan Chase & Co

There are two puzzles left to solve:

  • What is the best personalization software to use?
  • How can you use it productively?

Here’s how we can help you:

We’ve outplayed all providers as the #1 platform in Mobile Marketing Software and Personalization Software on the G2 Summer’21 Report by delivering up to 3X faster time to value (TTV). You can read more.

User reviews demonstrate we’ve achieved an average user satisfaction score of 4.6/5 on G2, with 81% of our users giving Insider a 5 star rating.

What’s next?

We’ve explored how a personalization platform can set you up for success. Our growth consultants work across all industries and have a depth of experience that we can apply to help your company access the full benefits offered by personalization software.

Drop us a line at info@useinsider.com or schedule a demo to get started today.

FAQ

  1. What is the difference between personalization and customization?

The difference between personalization and customization depends on who is making the changes.

Personalization is an automatic process that uses machine learning to create or adjust an item to match a customer’s needs.

Customization is when a customer manually adjusts data to create an experience that meets their specific needs.

  1. Why is personalization important?

Personalization leads to improvements in:

  • Response rates
  • Customer retention
  • Customer satisfaction
  • Overall brand profile

Conclusion

To better craft personally relevant customer journeys, brands themselves must craft their own customized marketing journey to fast track the most responsive pathways for their consumers. Modern B2B customer demands require this because personalization is now a huge factor affecting customer retention. Personalization software also helps your business scale with impact, influence customer purchasing decisions effectively, and increase revenue for your company. 

By placing a premium on your information architecture, as a brand you will access greater insights into customer preferences so that the journey can be a delightful one for both your consumers and your brand. Schedule a demonstration now to see what enhanced personalization can do for your brand.

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Srikant is a seasoned product marketing leader with 15+ years of experience in building and marketing SaaS products. As VP of Product Marketing at Insider, Srikant is responsible for Insider's product positioning, GTM and analyst relations. When not working on product marketing projects, Srikant loves exploring the design and engineering of things