The Importance of Personalization
November 2005
INTRODUCTION
When e-mail was first introduced as a viable marketing and
communications vehicle, organizations used it to send mass messages
to large databases of contacts. It was a fast, cost-effective tool. Since
then, email has become a more complex marketing medium as a
result of both regulatory and market demands requiring marketers
to update their use of this medium.
Audiences today favor demassification and personalization of the
marketing messages they receive. Demassification refers to the
process of breaking down the mass market (those large lists of
contacts) into focused, segmented groups based on preferences,
lifestyles, purchasing trends, values and priorities—to name a few.
The focus has shifted from a “one size fits all” model to content that
is relevant and specific to the intended recipient.
Personalization commands the user’s attention with tailored
messages and products. It builds familiarity by utilizing consistent
templates that employ a similar “look and feel” to what the end user
is used to seeing. These attributes help establish a bond with the
recipient that will, if executed correctly, promote loyalty through
increased customer service.
Incorporating personalization into e-mail marketing campaigns
increases response rates, instills trust in the organization and the
messages it sends and builds a relationship with the end user that
encourages them to become an active contact.
With all the advantages to this tool, why aren’t more marketers
using it? Most e-marketers do use personalization on some level
whether it be using the first name in the message greeting or
sending different messages based on geography or membership
status. The most successful marketers work with their e-mail
service provider (ESP) to delve deeper into their database metrics
and build campaigns that uncover the essential information needed
to personalize messages effectively. The challenge to successful
personalization is availability of data, time and cost to collect useful
data and understanding the technical aspects employed by ESPs to
personalize campaigns.
The purpose of this paper is to review general concepts behind
personalization, further investigate its advantages, discuss the
challenges to personalizing campaigns and provide solutions to
overcome the challenges.
DEMYSTIFYING THE CONCEPT OF PERSONALIZATION
A simple Google search provides many documents written by
marketers that give definitions of personalization including:
• The process of gathering user-information during
interaction with the user, which is then used to deliver
appropriate content and services, tailor-made to the
user’s needs.
(Source: Personalization of Web Services: Opportunities
and Challenges, http://www.ariadne.ac.uk/issue28/
personalization/)
• Building customer loyalty by building a meaningful one-
to-one relationship.
(Source: Doug Riecken. “Personalized Views of
Personalization.” Communications of the ACM, 43(8):
27--28, August 2000.)
While the word choice varies, the concept is the same—building
customer loyalty and satisfaction by gathering and using data
tailored to the customer’s needs, preferences and values. Online
vendors frequently use this concept. If you visit Amazon.com and
look up fitness DVDs with or without purchasing them, the next
time you visit the page you will see Amazon has automatically
recommended other fitness DVDs based on your recent search.
You will also receive a personalized confirmation page if you
purchased a DVD with additional items related to your search.
Personalization occurs in different ways in an e-marketing
campaign. Some ways include:
• List segmentation – dividing marketing lists based on
pre-determined factors to create targeted messages to
each segment.
• Content – tailoring the text of the message to fit the list
segment.
• Subject line – creating a subject line that is personalized
to the recipient, grabs their attention and increases the
likelihood they will read the message.
• Address line (i.e. Dear [Insert name],) – including the
recipients first name in the greeting.
• Signature (insert a name and personal signature)
– including an electronic signature from the person
 sending the message.
• Type of message – a recipient may sign up or be qualified
to receive certain publications such as e-newsletters or e-
zines.
Segmentation of the distribution list is a key component of
personalization. Many organizations purchase or build marketing
lists that include hundreds or thousands of names from different
backgrounds, interests, professions, etc. Dividing, or segmenting,
the list by pre-determined factors will help guide the development
of a personal message. The segmenting factors are determined by
the goal and scope of the e-marketing campaign.
Example:
ABC Association is conducting an e-mail marketing campaign
to increase attendance at its annual educational meeting. After
reviewing attendance statistics for the past three years, the marketing
director concludes that only 50 percent of their current membership
base attends the meeting. ABC Association currently has 95 percent
of their members e-mail addresses in its database. The membership
represents different industries (allied healthcare professionals,
automotive service workers, nursing industries, financial planners,
etc) with varied professional interests, socioeconomic backgrounds,
educational needs and technological skills.
ABC’s marketing director works with their ESP to segment the list
and subsequent messages based on the following factors:
• Geography – contacts within driving distance to the three-
day meeting location receive messages focused on the one-
day rate and their ability to choose the day based on their
educational program needs.
• Activity levels – members who had participated in
other events or purchased publications already had a
connection to the organization. They received messages
targeted toward educational content and encouraging
their continued learning and professional development
through attendance at the three-day meeting. If they have
had no history with ABC except for their membership,
they received an introductory message highlighting the
importance of attending the meeting.
• Membership type – those members that fall into a vendor
category (service providers to the industry) receive
messages recruiting them to exhibit and sponsor social
and networking functions.
• Educational content – the content of the meeting was
divided into tracks based on professional experience levels
(i.e. beginner, intermediate, advanced). Contacts received
messages targeted to their perceived experience level
based on their years in the industry.
It is important to note the difference between personalization
and customization. Customization allows the user to proactively
configure a Web site and/or create a profile. Personalization occurs
when the marketer actively gathers information from the user or
analyzes their activity and profile.
Common Terms
Call to action: In an email message, the link or body copy that tells
the recipient what action to take.
Content: All the material in an email message except for the codes
showing the delivery route and return-path information, including
all words, images and links.
Cookies: A collection of information, usually including a username
and the current date and time, stored on the local computer of a
person using the World Wide Web, used chiefly by websites to
identify users who have previously registered or visited the site.
Demographics: The characteristics of human populations and
population segments, especially when used to identify consumer
markets.
Dynamic content: Email newsletter content that changes from
one recipient to the next according to a set of predetermined rules
or variables, usually according to preferences the user sets when
opting in to messages from a sender. Dynamic content can reflect
past purchases, current interests or where the recipient lives.
Landing page: A Web page viewed after clicking on a link within
an email. Also may be called a microsite, splash page, bounce page
or click page.
Personalization: A targeting method in which an email message
appears to have been created only for a single recipient.
Personalization techniques include adding the recipient’s name
in the subject line or message body, or the message offer reflects a
purchasing, link clicking, or transaction history.
Psychographics: The use of demographics to study and measure
attitudes, values, lifestyles, and opinions, as for marketing
purposes.
Segmentation: The ability to slice a list into specific pieces
determined by various attributes, such as open history or name
source.
Signature: A line or two of information found in the closing of an
email usually followed the sender’s name. Signatures can include
advertising information, such as a company name, product, brand
message or marketing call to action (subscribe to a company
newsletter with the email subscribe address or Web registration
form, or visit a Web site with the URL listed).
Subject line: Copy that identifies what an email message is about,
often designed to entice the recipient into opening the message.
The subject line appears first in the recipient’s inbox, often next
to the sender’s name or email address. It is repeated in the email
message’s header information inside the message.
CHALLENGES AND SOLUTIONS
Personalizing e-marketing campaigns allow organizations to
effectively target and capture potential contacts. The most notable
benefits of personalization include:
Page 2 - The Importance of Personalization
 • Increasing response rates – Statistics indicate that
personalized messages lead to higher response rates from
users to the marketers “call to action.” The call to action
is the desired action from the message. It could be a click
through to the organization’s Web site or an invitation to
attend an event.
• Building relationships – Building a relationship with
the user increases the likelihood the user will purchase
services or products, continue to read and act on messages,
visit the organization’s site and stay on as a long-term
customer or member.
• Promoting security with customers – The volume of spam
in the recipient’s general inbox requires marketers find
creative ways to ensure the recipient reads the message.
Personalizing the message with relevant information
increases customer’s security with the organization.
Personalization helps marketers legitimize their messages
to the reader.
Despite the opportunities available, organizations still face
challenges to personalizing e-campaigns. The challenges a marketer
faces vary depending on their level of e-marketing expertise, e-mail
client, etc. The organization’s ESP is typically able to deal with these
challenges rather easily. Gold Lasso defines the top three challenges
as unavailability of data, timeliness and cost to collect data and
technical aspects.
Challenge: Unavailability of Data
In this case, the marketer or organization does not have data to
segment their distribution list or personalize the message.
Solution: Incorporate surveys, polls or response forms to build
database.
The first step is to use any data available, even if it is just a first name,
to begin personalizing the message and campaign. For example, if
the organization is a non-profit membership association it likely
has names and member ID numbers for billing purposes. That
information can be used to initially personalize. By using the name
and ID number the sender builds security with the recipient who
recognizes the confidential information as a legitimate message.
Incorporating templates that contain the organization’s logo and
general “look and feel” will help build a brand with the recipient
as well. However, gathering data should be the main focus to
overcoming this challenge.
Gold Lasso recommends using quick surveys, polls or response
forms in the email and on the landing pages that can be merged
with general databases and used in future campaigns.
Challenge: Timeliness/Cost to Collect Data
In this case, the organization believes they do not have the time or
budget to gather the data needed to personalize the campaign.
Solution: Consult with the ESP to develop tactics to gather data in
current campaigns.
Collecting data for personalization can occur in every campaign
that is sent. For example, if a non-profit membership association
conducts online membership renewal, the data collected (i.e. name,
contact information, industry, title, etc) can be used to personalize
messages later in the year at a relatively low cost.
The key is to discuss options with the ESP instead of
assuming the technology costs too much money. In the
end, the return on investment (ROI) could far exceed the
initial cost.
Challenge: Technical Aspects
In this case, the organization does not understand, own
or utilize technical solutions available to personalize the
message.
Solution: Educate yourself on the main aspects of
personalization and work with an ESP to handle the
technology.
If e-marketing is not your primary profession, turn to
someone who is an expert (such as an ESP) to help you create
an e-marketing plan that incorporates personalization.
The technology around this medium changes frequently.
The ESP’s job is to stay up-to-date with technology changes
and communicate that to the client.
CONCLUSION
Personalization is a key tactic to improve the success of an e-marketing
campaign. Personalized messages encourage the recipient to read
the content and respond to the call to action. More importantly,
personalized messages serve as a tool to build a relationship between
the marketer and the recipient that can ultimately lead to consumer
loyalty. In an environment where consumers are inundated with
choices, employing a tool that promotes continued interaction is
essential.
Personalization also helps increase perception that the marketer
is a viable information source. This helps to decrease spam
complaints and ensure the delivery of the message. The overall
concept of demassification is dynamic, much like the personalized
message itself. It will continue to evolve as techniques for gathering
information improve. The goal is to understand its benefits and
stay up-to-date with technology available to use this beneficial
marketing technique.
25B Chestnut Street
Gaithersburg, MD 20877
301-990-9857 Phone
301-990-9856 FAX
http://www.goldlasso.com
© Copyright Gold Lasso, Inc. All rights reserved.
Page 3 - The Importance of Personalization