Why Marketers Struggle with Data-Driven Personalization

According to a January 2018 survey of 200 US senior decision marketers conducted by Verndale, personalization is most important for increasing sales and improving customer satisfaction and retention. Yet, 84% of survey respondents agreed that the potential of personalization has not been fully realized.

“In an increasingly connected, digital world, consumers now expect brands to serve them personalized content at the optimal moment and on their preferred device,” said Jeremy Hlavacek, head of revenue at IBM Watson Advertising.

“To achieve this level of engagement, marketers need the ability to predict—without coming across as intrusive—what their target audience will think, feel, say and do across a variety of scenarios. And with the incredible amount of data available now, personalization is more complex than ever,” he said.

The biggest barrier to achieving personalization goals is a lack of resources, according to a Sailthru survey of 146 UK and US marketers conducted in October 2017. More than four in 10 respondents said that a lack of time, people and money has inhibited their personalization efforts. Challenges around data were also cited as a top barrier. According to Jon Schulz, CMO of Viant, marketers need robust customer relationship management data to properly segment audiences for personalized massages.

“Those who know they have a data quality problem usually don’t know the extent of the issue, and those who do are faced with tough choices that can be very costly, unthinkable or not ideal,” said Austin Miller, director of product marketing at Oracle Marketing Cloud.

Another challenge for marketers is that effective personalization requires more than repeated ad targeting. Just 6% of respondents in an April 2017 survey of 1,111 UK internet users by Mumsnet and Saatchi & Saatchi said they liked retargeted ads. And in an August 2018 survey of 1,079 adult US internet users conducted by Janrain, about one-fifth of respondents acknowledged that online ads are effective in appealing to their interests and needs, but found the phenomenon creepy nonetheless.

“There’s a bit of cognitive dissonance among consumers when it comes to personalization,” Hlavacek said. “On the one hand, they have told us they want contextually relevant, personalized advertising vs. seeing messaging from brands that has nothing to do with them. On the other hand, consumer distrust in advertising is at an all-time low as they rethink with whom to share their most coveted, private information. Brands that provide demonstrable utility and value while safeguarding their users’ data will likely fare much better in this current climate than those whose purpose is unclear.”

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