Coming Full Circle: Identity And Cycle Of Personalization

By Preethy Vaidyanathan, CPO, Tapad — Decades ago, consumer engagement used to be a personal experience. Brands communicated with local customers they knew by name, interest, etc. The growth of online purchasing has led to greater choice and convenience for consumers, while innovation in digital advertising has brought huge scale and lower costs for marketers — all at the expense of personalization.

However, consumers still crave personalization, with 59% saying it influences their purchase decisions, according to Infosys. Hence, the industry is coming full circle. Take retail, for example, where modern marketers Trunk Club and Stitch Fix are bringing back the customization of a personal stylist with the convenience of online shopping. Similar reinvention is happening across telecoms, financial services, healthcare, insurance, etc. 

The lesson here? Regardless of scale or innovation, the consumer demand for a personalized experience is bringing industries conceptually back to where they started. While a handful of brands are adapting, the majority find themselves falling short, largely because they do not understand the heart of personalization — identity. 

Think of it this way. Few consumers would ever define their identity as a 15-34-year-old, middle-income earner in Ohio, yet that level of insight often forms the basis of a so called personalized ad campaign. Brands can only arrive at genuine personalization when they augment these core demographics with insight into consumers’s interests and behaviors.

Here are four tips for brands looking to harness the true power of identity-driven personalization.

1. Embrace identity resolution: According to Forrester, identity resolution is an essential, strategic imperative that brands must embrace to foster relevant cross-channel consumer experiences. This is because identity goes beyond just knowing the consumer’s age or hometown, but takes into account far broader contextual data to provide a true persona including what device they prefer.

For example, by leaning into the identities of a big box retailer’s target consumers, we discovered two new, influential audiences: the young roommates (18-30 years old, middle income, maintain a healthy lifestyle, have at least four devices) and the family man with kids (35+, middle income, looking to cut costs, has two devices). This led to a successful campaign tailored to the interests and lifestyle of each audience and ultimately achieved a 41% lower cost per acquisition. Truly innovative brands quickly spot and bridge the gaps in their understanding of their consumer’s identity.

2.Recognize that identity is fluid: Consumers define themselves in different ways depending on context. An individual’s work persona, for example, may be radically different than their home identity. Furthermore, consumer preferences change over time. In order to turn data connections into human connections, brands need to understand the emotional component of their content and make sure they are connecting to a consumer’s identity at each precise moment in time, not just a snapshot of past interests. 

3.Personalize without compromising privacy: Identity-driven personalization needs to have privacy as a priority. Trust is a two-way street, and the more respectful brands are of consumers’ privacy, the more trusting consumers will be of their content. It is entirely possible to create a truly personalized experience without appearing invasive.

4.Beyond the call to action: Identity is more than just measuring conversions. Knowing when a consumer expresses either interest or disinterest with a content piece will help the brand develop a successful sequential messaging strategy. For example, were they served a video twice but did not click or view? Building this feedback into a consumer’s identity will help provide clues for future content.

Ads become a menace when they have no relevance. By understanding identity, brands will be able to approach content from a true personalization, not just monetization, perspective.

(This piece originally ran on MediaPost)