Marketing budgets freeze restricts brand personalization, Gartner report
The demise of third-party cookies, heightened consumer sensitivity to messaging, and tightening of marketing budgets have restricted personalization opportunities, according to Gartner, Inc.
Because of this, marketers need to rethink their personalization tactics to better navigate the current recessionary environment. They must refocus on first-party data: the data their company has collected directly from their audience.
In Gartner’s 2020 CMO Spend Survey, only 14% of respondents reported personalization and testing among the top-three capabilities they see as vital to supporting the marketing strategy.
This low level of prioritization suggests marketers are ill-prepared to capitalize on personalization. As a result, Gartner predicts that one-third of marketers will reduce spending on personalization as a line item in the marketing budget by 2021.
Evan Bakker, research principal, Gartner Marketing practice: “Marketers must obsess less over personalizing across the widest range of data sets, and instead leverage their immediately available first-party data sources. This will allow marketers to improve the customer experience across sites, apps and email in order to capitalize on an expanding digital audience.”
Gartner tracked and analyzed over 1,000 brands for personalization trends and identified four key findings that marketers should keep in mind as they refocus their efforts on first-party data:
Capture meaningful data at sign-up – While collecting less data can limit future targeting opportunities, form fatigue may result in lower sign-up rates, confining most brands to customer names and emails. Marketers should consider segmenting their customers through newsletter sign-ups by offering content preferences, a practice that brands in the pharmaceutical industry often excel at.
Gather and utilize explicit data after login – Account sign-up usually leaves brands with limited immediate data points for personalization, however, the post-login account customization stage can help brands collect richer information about their customers.
In fact, all brands studied in Gartner’s report, “Activating Explicit and Implicit Data to Personalize at Scale,” collected some form of segmentation data at the customization stage, compared to only 65% capturing such data during sign-up.
Personalize at scale with implicit data – Prioritize the incorporation of data sourced from session behavior to personalize sites for account and non-account holders at scale. An analysis of sites covering brands ranked as Genius or Gifted in Gartner’s Digital IQ Indexes showed that best-in-class brands most often apply these principles to cross-sell on the product page.
Leverage account data to target via email – Brand marketers must extend their site personalization approach to email, leaning on the implicit and explicit data gathered to send targeted communications.
For example, insurance brands frequently use data gathered from prospect quote submission forms or existing policyholders to target users via email across different stages of the customer journey to increase online conversion rates.