I've recently bought a deodorant from an online store I had never used before. Though I don't remember doing this, I must have checked the price of my favorite cologne before leaving that website.
I am now gifted every day with targeted ads on my smartphone apps sponsoring that very store and cologne. Like most people, I have contrasting feelings about this and have at times felt spied upon or even surveilled.
As marketers, we're all familiar with marketing personalization. We design whole campaigns around it, mainly because it works: at times boosting revenues by up to 15%. But if people tend to conclude they are being hounded by a company, what message is that company actually trying to convey, if any?
The unsustainable nature of marketing personalization
For 20-odd years, personal data has fuelled marketing at every stage of the customer journey—often at the expense of brand storytelling.
Marketers have feasted on this wealth of data and categorized customers into micro-segments to reach them with relevant (though often dull) ads. In some cases, however, this strategy has backfired; particularly among privacy-conscious consumers who are more likely to feel alienated, rather than connected, to any brand adopting intimidatingly intimate marketing tactics.
But data-driven marketing personalization is starting to lose the appeal it has had on marketers as well. Gartner has recently forecasted that by 2025, 80% of marketers who have invested in personalization will abandon their efforts due to lack of ROI.
Personalization comes, of course, with many success stories. But it is the excessive reliance many have placed on this strategy that is beginning to prove economically unsustainable for companies.
Our very own CMO of Bynder, Andrew Hally, summarized it well in his recent article: Why the Personalization “Hype Cycle” Is Over. "The ROI of personalization" he says "declines as it gets more granular and it becomes harder to find enough targets for each deeply personalized ad."
As marketers need to generate more creative and more copy to dish out a high volume of micro-targeted ads, costs will inevitably go up, while returns go down. So what's the solution?
Creativity remains the number one factor driving ROI
For nearly two decades, marketers have often shortchanged creative ad storytelling in their digital marketing campaigns in favor of micro-targeted, data-driven, storyless ads. But Nielsen has recently reminded everyone that the number one factor driving ROI remains the creative; which, alone, is responsible for the largest contribution (47%) to sales from ads.
Creativity is an intuitive element, one that requires a human touch and heart to generate an emotive response in the receiver. Data will undoubtedly continue to drive digital marketing campaigns, but the goal of micro-segmentation needs to be reframed with creativity as the main focus.
If the incremental ROI of personalization continues to decline, marketers will do well to add a much-needed creative spark to their digital ad campaigns in their attempts to drive more value from their efforts.
The hazards of micro-segmentation
Microsegmentation usually involves the creation of ad-hoc creative content to target each segment and reach consumers on every channel; don't forget testing beforehand. Creating, testing, tweaking, and adapting assets to fill every step of the segmented customer journey is often an unsustainable burden imposed on both marketers and creatives.
But how did we get to this point? An endless supply of personal data has resulted in an enthusiastic attempt by many modern brands to exploit it as much as they can, compelled by the idea that "better personalization = better results". As a result, advertisers have often moved away from what used to be creative choices, in favor of data-driven targeting strategies that aim to reach consumers, rather than connect with them.
For years, this practice has diluted the creative quality of many digital campaign assets. Failing to communicate a unique and "human" brand identity in targeted ads, brands often leave consumers wandering an uninspiring wasteland of digital sameness.
Creative automation tools free creatives from the burdens of marketing personalization
Creative automation tools are designed to liberate the creatives from having to hand-generate the countless, nearly identical variations of each asset necessary to fuel personalization. Digital and video templating tools, like Bynder's Digital Brand Templates and Video Brand Studio, allow marketers to become self-reliant, quickly create the online, brand-consistent content they need, and achieve faster time-to-market.
Here's a glimpse of what you can do with Video Brand Studio:
By empowering marketers to scale content creation and distribution independently and in line with brand guidelines, creatives can concentrate on what they do best: creating original, memorable campaigns that strengthen brand identity and inspire trust.
As brands begin to approach the twilight of personalization as we know it, they will soon need to reimagine the goals of marketing segmentation and what digital ad campaigns are going to look like in the near future.
See what creative automation can do for you with a free demo 👇