The Definitive Guide to Personalized Promotions
Given today's CRM systems and AI, businesses can and do personalize each customer touchpoint and every interaction, including incentives. Promotion personalization revolves around fours key areas:
- Customizing promotions based on audience and individual customers.
- Personalization driven by special occasions, festivals and holidays.
- Personalizing the incentive itself (material rewards in a loyalty program or a discount on customer's favourite products).
- Customizing the channel via which the incentive is delivered.
Read on to learn the best practices and examples of promotion personalization.
What is personalization?
Accurate personalization would be impossible without a detailed analysis of customer behaviors and characteristics with the help of CRM systems and AI (e.g., Salesforce AI Einstein or Amazon AmaBot algorithm).
As much as 70% of customers expect and appreciate the individual treatment that comes with well-crafted personalized e-commerce experiences. Customers like being reminded what products they were interested in before. They also enjoy receiving vouchers for products they purchase regularly or a sweet discount when shopping for the first time.
What makes bad personalization?
Before we jump into best practices and examples of personalization done right, let’s make sure that you know some of the personalization deadly sins.
Personalization is a double-edged sword and it can be a tool that can win your customers over but also discourage them from ever having anything to do with your business ever again.
What are some of the worst practices for personalization in e-commerce?
- Offline tracking with no explicit consent received from customers.
- Location tracking is a risky business (only 20% of customers wish to share their location data).
- You’d better give search history tracking a wide berth (only 14% of customers agree to personalization based on their search history and who can blame them?)
- Unclear explanation of how customer personal data will be processed and whether or not it will be shared with third parties.
- Personalization that evokes negative memories or even guilt will surely alienate customers from your business (e.g., recommendations connected with medical conditions or weight loss).
- Suspiciously accurate personalization (e.g., welcoming a new customer with a pop-up reading “Hello Ann Baker from Brooklyn. Would you like to get a new winter coat for your long evening walks with your two dogs, Bennie and Robbie?”) Yup, even if your personalization technology allows you to dig deeper, too much personalization is never a good idea, it is simply intrusive.
What are personalized promotions?
Given today's technology, you can personalize not only customer experiences, product recommendations, products themselves, but also incentives such as discounts, cart promotions, referral and loyalty programs, and even online giveaways.
What makes incentive marketing and promotion personalization work so well together?
They both rely on the power of impression and aim at influencing customers' behavior by using interactive channels that presuppose a sense of intimacy between your brand and potential customers. Consequently, both approaches play a crucial role in nurturing brand loyalty as incentive marketing offers personalized rewards and a sense of reciprocity.
I want to personalize my promotions. What should I do now?
There are two approaches you can take when personalizing your offers. You can opt for building your incentive infrastructure for creating various promotions, publishing them to customers, redeeming codes, and tracking the performance of the campaign in real-time. Not to mention setting up the logic behind customer segmentation and maintaining a transparent single customer view.
This approach may work if you want to launch a small-scale campaign with no automation whatsoever. However, if you wish to do something slightly more serious, ROI would be much smaller than the costs of the developmental efforts behind brand-new promotion infrastructure. You'd also run the risk of taking yourself out of business - the road to hell is paved with good intentions, amirite?
So, if building your promotion infrastructure is a tall order, that means I need to pay someone to get it done? Yes and no. By using ready-made personalized promotion solutions such as Voucherify, you need to spend some cash. Just like you would in the case of building your architecture. But there's a catch. An API-based promotion engine will let you use its building blocks to tailor the service to your business's unique needs. Also, it will shoulder the burden of maintenance, functionality development, monitoring, and analytics of your campaigns. Think of it this way - when you need to create stunning visuals or eye-catching graphics, do you create a dedicated solution from scratch or maybe look for software that allows you to do just that? Promotion engines are a relatively new thing in the SaaS market. Yet, they have the same function for marketers as Photoshop has for graphic designers.
Promotion Personalization starts with customer data
Whether you buy or create your own infrastructure, it has to supply you with constant flow of real-time data, statistics, and fine-grained metrics; without invasive tracking or bothering your visitors.
1. 360 degree customer profiles
Get a complete picture of your customers. With 360 degree customer profile, you can see their individual preferences, purchase history and easily track customer activity. You can use all of these collected attributes to group your audience and target segments with customized offers. But without customer data, all your personalization efforts will likely go down the drain.
2. Campaign overview at hand
Improve your promotions on the run. With Campaign overview functionality and user-friendly Dashboard stats you can see how your campaigns perform in real-time. Capturing what’s going on and where has never been so easy. Most promotion management software out there, offers this kind of functionality.
3. Promotion redemption data
Get a complete control over your promotions, and plenty of insights of what works best for your business. Redemptions list shows precisely who and when redeemed each of your promo codes. Data are ready to export with all their details straight from the Dashboard. Another crucial aspect is to learn the reasons for failure if any of your incentives proves to be problematic for customers. By doing so, you may prevent any ill feelings from arising by offering a quick sorry discount, giving customers a sense of exclusivity and attention.
4. Build custom real-time segments for your promotions
Every business requires a different approach to group and target their customers. We also know that relevant segmentation is crucial to offering truly personalized offers at scale. Keeping that in mind, next to the extensive list of built-in filters, you should be able to segment your customers using unique properties. This way you can enjoy greater marketing flexibility while building custom segments updated in real time.
5. Behavioral and personalized promotion triggers
Schedule customized promotions under specific conditions. With dynamic customer segments, you can create gamified, multi-level promotions. Make sure that you promotion management software automatically reacts to abandoned carts, new orders, profile updates, and so on. These triggers may later on serve as reward actions in referral or loyalty campaigns. You can also base your promotional messages send-out on unique customer behaviour.
6. Get credible insights with A/B tests
A/B tests let you verify promotions in practice before you run them on a full-blown scale. You can test each parameter of every promotion and simply figure out what’s converting your customers best. It's important to test your workflows and business logic before rolling out a full-scale campaign. That's why you should always seek out solution that enables work in a sandbox mode and that let you quickly activate and deactivate incentives.
What do I mean by promotion personalization?
Promotion personalization can occur on many levels:
1. Targeting specific audience with personalized promotions
The most basic promotion personalization is to target your incentives only at selected customers with predefined customer attributes, such as country, purchase history, or gender. You can create unique codes redeemable once by customers who meet specific criteria.
Coupons are an excellent fabric for interweaving personalization as they may come equipped with many rules that define redemption circumstances. The only limit that restricts ideas for promotion rules are the capabilities of your coupon infrastructure. For example, you can add product-specific limits, particular customer segments, budget-based rules, limits based on the price of items in a cart, rules defining required order history, and so on.
- Re-engagement campaign for customers who have been inactive for more than 3 months (discount 20% off on orders above 100$).
- Cart promotion for orders above 250$ and premium-status customers.
- Sorry discount voucher for customers who made a complaint to your support agents.
2. Personalizing campaign time frame according to time zones and calendar
Calendar-driven promo campaigns like holidays, birthdates, or anniversaries are a brilliant and natural way to entice customers throughout the whole year-round. You can always try digging a little deeper and launch exclusive deals for smaller occasions such as International Friendship Day or International Dog Day for all the dog lovers out there. But how can you know who has a dog? By tracking customer purchases and searches. Have you heard of this story?
- 1-year anniversary with a special unique code or cart-promotion for 50% off with maximum discount amounting to 500$.
- Birthday Campaign with a 20$ discount + free shipping.
- St. Patrick’s Day Special Deal for customers from Ireland.
3. Personalizing promotion rewards
If you are running a loyalty program or an online giveaway, this point is a must. Do you enjoy receiving things that are in no way relevant to your interests and preferences? Yup, I thought so. Your customers don’t like it either. So go out of your way to provide rewards that are truly valuable and not just some dusty odd and ends from the warehouse.
Shoppers will only feel incentivized with a reward if it makes sense for them in the current context and when it dovetails with other promotions you’ve launched before.
If you are not sure how to customize your rewards catalog, you can always send your customers a survey first. They will certainly appreciate it and will give you honest feedback. That’s a win-win right there.
- If you want to invest in the brand narrative more, try out launching a charity loyalty program with rewards being different charity initiatives.
- Try offering discounts or gift cards instead of material rewards as their power lies in innovativeness, flexibility, and tracking possibilities. They can be tailored to the needs of a particular customer, wrapped into a personalized message, and finally, tracked throughout their entire lifecycle.
- Gamify the experience and send customers personalized rewards for beating levels of your loyalty campaign.
4. Personalize promotion channels
Even the best promotion personalization falls flat if the way of delivery isn’t right. If you send the best-personalized deal, but it’s packed in a gray bundle of mediocrity, it will likely go right to SPAM. Create a multi-channel messaging and stick to your brand's look and vibe. Which touchpoints and channels can you personalize?
- Place ready-to-go web widgets on your website that allow client-side redemption of personalized discounts.
- Send push notification with a 20% discount inviting customers to your brick-and-mortar store if they end up in one of the designated locations.
- Send best wishes and discounts via SMS to tap into the sense of intimacy created by mobile marketing.
Of course, I don’t have to mention referring to the customer by name, do I?
5. Personalization based on cart and order structure
With more than 60% of carts being abandoned before finishing the purchase, discounts have emerged as the perfect remedy for saving many of them. From the technical point of view, you need a dynamic segment based on a specific customer behavior. By using a cart-level promotion, customers who abandoned their cart and enter the proper customer segment can revisit your store and instantly find the discount at the checkout. Moreover, if after some time (e.g. 2 days) the purchase still isn't made, the system can automatically send an email/SMS with a coupon and remind them about their unfinished order.
What can I achieve by personalizing my promotions?
Yada yada yada…This whole personalization thing seems pretty nice, but will it bring you any quantifiable benefits in terms of sales or conversions? Yes, it will.
You can attract new customers
By launching effective and highly customized promotions, you are sure to be the talk of the town. Why? Personalization increases customer satisfaction, and customer satisfaction leads to better brand advocacy, which in turn results in more customers hearing about your services and willing to give you a try.
You can convert visitors
Imagine a new customer arriving at your e-commerce store, unsure whether to stay for longer or leave. And right then, your team jumps out of the live chat offering a ready-to-go coupon for the first purchase with a cute welcome message. This approach allows you to start building 1:1 customer experience with new users at the very beginning of the sales funnel.
Also, if you already have some contact information, send personalized product recommendations based on previous search history and individual preferences.
You can increase customer loyalty by offering personalized offers
E-commerce is making a big switch from customer acquisition to customer retention initiatives, and you should too. Customers who already purchased from you and were satisfied with the process are much more likely to repeat purchases and spend more. You can send personalized messages with exclusive deals or a tailored product bundling offer.
You can also invite customers to referral programs after they made X number of purchases and offer them unique rewards for their word-of-mouth marketing. You get positive publicity and your customers receive discounts for products that they already enjoy using.
You can remind customers about your brand
Send an email message to customers who were inactive for some time. Try sending a 20% discount code with a short expiration date and ask your customers if you did something wrong or maybe how you can improve your service to suit their needs. By adding a bit of human touch to the conversation, you are giving inactive customers a reason to come back.
Generic discounts and promotions could work in the olden days. In the era of digitization, promotion personalization is an indispensable tool in any marketer's toolbelt. Now the question is if you are going to build the infrastructure you need yourself or leave it to professional promotion personalization software giving yourself more time to plan your incentives instead of focusing on technicalities.
Can’t wait to launch your first personalized promotion?