[Posted by Ed Hadley
Senior Marketing Manager, Neolane, Inc.]

Most marketers wouldn’t question the premise that providing customers and prospects with more personalized communications yields better results.  But the degrees of marketing personalization—and their corresponding effectiveness—vary greatly.  At Neolane, we’ve identified five degrees of marketing personalization used by organizations today. Here they are from least to most personalized:

1. No Personalization (aka Mass Emailing) – The same exact message is sent to every recipient, an approach often referred to as “spray and pray” or “batch and blast”.  Essentially, it’s the marketing equivalent of carpet bombing: sending as many messages as possible with no precision whatsoever.  It’s highly ineffective and can damage your reputation.
2. Superficial Personalization – The message is personalized only with the recipient’s name (e.g. “Dear Bill”); otherwise, the content is identical.  Because it offers no additional relevance, most recipients see superficial personalization for what it is: thinly veiled mass communication.  It generally produces minimal incremental improvements in campaign performance.
3. Segmentation-Based Personalization – All of the customers or prospects belonging to a specific segment of the database receive the same message.  While this approach is more targeted than superficial personalization or mass communication, it doesn’t take into account each individual and their relationship/history with the brand.
4. One-to-One Personalization – The message is personalized with content that is specific and relevant to each individual recipient.  One-to-one personalization draws from a detailed, living customer profile encompassing demographics, preferences, interaction history, and more.  This data is used to tailor virtually every element of the message, as well as the channel used and frequency.
5. Interactive One-to-One Personalization – The one-to-one concept above is applied to inbound channels, such as the web, point of sale (POS), and call center.  Using the very latest profile and behavioral data, the best content is selected, personalized, and rendered in real-time, while being consistent with messages delivered through other channels

Interestingly, what most marketers generally refer to as “personalization” is actually the third degree: segmentation-based personalization.  This means that there is still a huge opportunity to improve marketing effectiveness through greater personalization.

Over the next few weeks, we’ll be sharing additional information and best practices on how marketers can move up the scale and achieve true one-to-one personalization across outbound and inbound channels.  Stay tuned and feel free to share your own personalization tips and tricks!

In the meantime, download our two-part white paper, Getting Personal with Your Customers, to learn more about the powerful effects of marketing personalization:

• Part I – Fighting Marketing Fatigue
• Part II – Beyond Segmentation