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Personalized Advertising and Why It’s So Important for the Future of Media

December 15th, 2016   ||    by Charlene Weisler   ||    No Comments

Personalized advertising is the key to ensuring that advertising messages reach the most receptive and interested consumers. For years, the ad market has relied on age and gender as a proxy to match viewers with messages, but these general categories are often too broad. Not all men aged 18 to 49, for instance, have the same purchasing patterns and preferences.

The Move to True Personalization

With the advent of behavioral segmentations that are more closely aligned by lifestyle, it became possible to add both nuance and focus to consumer targets, moving beyond age and gender. Now, advanced technology enables even more precise targeting capabilities, with real-time dynamic ad insertion that offers advertisers further precision.

Personalized advertising, also known as one-to-one advertising, has been around for decades. But its form has changed with the increased adoption of personal devices, cross-platform advertising, technological improvements, and more advanced and detailed datasets linking consumer behaviors together.

As a result, it has never been more attainable to target and deliver more individualized messages and offerings to current or potential consumers. And there’s arguably no more efficient way to implement personalization than through programmatic platforms.

Getting Started in Personalization

According to Arjen van der Broak for AdAge, the road to personalization “involves segmenting audiences into distinct groups and creating relevant messages for each individual within each group. Cognitive self-learning can refine each engagement based on information gathered about a customer’s tone of voice and behavior over time.” But where to start? Tracy Swedlow, Co-Founder and CEO of TMRW Corp, believes that, “Before they can personalize the content, they need to know who the audience is, that audience’s network of contacts, who knows those contacts, and then how to distribute content to all those people. It’s about the network—not the medium or the message.”

Advantages of Personalization

There will be a certain amount of waste with any media plan: messages sent to viewers who are unreceptive, non-purchasers, or loyal to a competing brand will never be persuaded. But if the message is crafted to a stricter profile of potential and current users of the product or the service, there will be a greater chance for connection. As reported by AdAge, Allstate launched a campaign focusing its message strictly on viewers who rent, as opposed to a general age-gender target. In this way, only the most relevant target consumers would see the ads and waste would be limited.

Personalization also spurs greater engagement, attention, and higher potential to purchase because the message better resonates with the consumer. According to Quarticon, automaker Kia focused on developing a more targeted profile of its consumer, and “as a result, Kia achieved a 30% improvement in cost per action (CPA).”

Personalization Challenges

As with everything, personalization has its challenges and cautionary tales. Brent McGoldrick, CEO, Deep Root Analytics, warns brands to “communicate in a way that is personal, yet still consistent with the brand’s overall promise and message architecture.” And a big pitfall, according to McGoldrick, is “ignoring context by assuming that a consumer is equally receptive at any touchpoint. The reality is consumers’ receptivity to messages can vary based on the platform, daypart, content.” Through big-data algorithms and carefully curated segmentations, programmatic advertising enables advertisers to reach the right consumers at the right time—and in the right context.

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