How can we make personalisation work in a privacy-conscious world?

In a recent post, I wrote that it's time for organisations to rethink their approach to personalisation.

The value of personalised marketing and experiences has been widely recognised for nearly two decades, and most pundits are recommending that marketers expand their use of personalisation. They contend that marketers should make personalisation more specific and use it more frequently, in more channels, and for more types of communications and experiences.

The problem with this "more personalisation" approach is that it fails to account for widespread and growing privacy concerns among both consumers and business buyers. Personalised marketing will not reach its full potential unless marketers use an approach that addresses these privacy concerns. Simply increasing the use of personalisation will be ineffective at best, and may do more harm than good.

Personalisation has been the subject of numerous research studies over the past few years, and these studies provide a good picture of what is required for personalised marketing to produce maximum results. There are three major components of an effective personalisation strategy.

1. Make personalisation useful

The first requirement for effective personalised marketing is that it must deliver meaningful and pragmatic value to the recipient. A 2018 study by Gartner/CEB documents the business value of personalisation that is perceived by customers and prospects to be helpful. I've previously discussed this research, so I won't repeat that material here. For a more detailed description of the Gartner/CEB study see this post.

2. Make personalisation "relationship-appropriate"

The second component of an effective personalisation strategy is to use a level of personalisation that is appropriate for each customer or prospect. By appropriate, I mean that the level of personalisation should match the real-world status of the relationship. A message or offer sent to a long-time customer can and should be more personalized than a first outreach to a new prospect.

To be effective, personalised marketing must be based on genuine insights about your customers and prospects. When you take personalisation beyond such insights, it becomes inauthentic and will tend to be perceived as presumptuous. Corporate Visions recently conducted a field trial involving this principle, and you can read more about that research in this post.

3. Get meaningful permission for personalisation

Much of the concern about data privacy and personalisation revolves around the issues of transparency and control. Many consumers and business buyers aren't confident they know what personal data companies are collecting about them or how that data is used. And many feel they don't have any meaningful control over those data practices.

Several recent research studies have shown how important transparency and control are for customers and prospects. For example, in a 2019 survey of 3,000 people in the US, Canada, and the UK, The Harris Poll asked participants about the importance of several data privacy practices. The following table shows the percentage of survey respondents who rated four transparency and control practices as very important or absolutely essential:

These research findings point the way to the third important component of an effective personalisation strategy. In a world where privacy concerns are heightened, permission is critical to successful personalised marketing. If all the research about personalisation tells us anything, it tells us that most consumers and business buyers will welcome and value personalised content when it is helpful, authentic, and based on permission that is willingly and consciously given.

So, how can marketers gain this kind of permission? There are three key steps.

1. Use personalisation "programmes". In most cases, personalisation efforts should be organised into discrete programmes, each of which is designed to provide a specific type of value to a specific type of customer or prospect. This approach leads marketers to focus on the purpose of personalised marketing from the recipient's perspective.

2. Invite participation. Invite your customers and/or prospects to "subscribe" to personalised content on a programme-by-programme basis, and reassure them that subscribing to one programme won't open the floodgates to other marketing communications.

3. Be transparent. It's important to be "radically" transparent in your invitation about the details of the personalisation programme. The main objective of the invitation is to persuade customers or prospects to participate in the programme. So it should include:

• Why the programme will be useful and valuable for the recipient.
• What personal information will be used, and how the information will be used.
• How the personalised content will be delivered (format).
• How frequently the personalised content will be delivered.
• The duration of the programme.
• A clear statement that the recipient has the option to "unsubscribe" at any time.

It's about how - not whether - to personalise