10 Reasons Why Personalized Ads Pay Off

Personalized Ads

Digital advertising offers a platform to reach millions and grow your business. But it can start to feel impersonal quickly.

Consumers have seen enough ads to know when one isn’t speaking to them directly, and they have little patience with all the other options to hold their attention. They’re looking for something more: the perfect fit that matches their unique needs and interests. Personalization – delivering ads specifically designed to appeal to each impression – will separate the winners from the losers in a crowded online environment. And for the advertisers who have embraced it, it’s already paying off.

Why Generic Advertising Doesn’t Work Anymore

Although the current digital advertising environment is full of opportunities, it brings with it its share of challenges. Two major issues advertisers face are increased competition and fragmentation. Users are interacting with brands from PCs, tablets, mobile devices, and other channels, and there is stiff competition for their valuable attention. That competition will only intensify over time as more businesses enter the online space. Consumer expectations of how advertising is supposed to work have also shifted. We’ve transitioned to a customized, convenience economy where what we buy says something about who we are. From custom TV packages with thousands of channels to creating the perfect station on Pandora, everything has to be just right. Consumers are demanding and embracing more personalized experiences.

Marketing Is Already Paying off

In today’s attention economy, authentic personalization is the name of the game. Nearly 9 in 10 consumers say personalization has an impact on their buying decisions. Leveraging programmatic technology can help you personalize your ads to appeal to every impression and make the most of your ad spend. Here are 10 reasons why personalization is already helping businesses better connect with consumers (and how it can help you do the same):

1. Increase Loyalty among Existing Customers

Most businesses spend a good deal of their budgets acquiring customers; personalized ads can help them make the most of their investments. Programmatic lets you personalize ad experiences to better appeal to one-time customers and turn them into repeat buyers. You can use purchase activity data to offer customers discounts and special deals, making additional offers even more irresistible and encouraging repeat purchases. It’s much more cost-effective than acquiring new customers to replace lost business.

2. Create a Cycle of More Engagement and Better Data

You need actionable data to guide your personalized marketing. But you also need personalized ad experiences to collect more valuable data. It sounds like a catch-22, but it doesn’t have to be. Just getting started with personalization – even if you have minimal data to go on in the beginning – will tell you more about your customers and how best to appeal to them. Making the decision to personalize your ads begins a profitable cycle. You drive higher engagement because users feel like you understand them, which gives you more data. Then you integrate this new data to refine your personalization strategy, and the cycle continues… leading to an increasingly optimized (and profitable) strategy.

3. Make Your Ads More Relevant to Consumers

Why aren’t more digital ads performing as well as they could be? A big reason is they are irrelevant for most users’ interests and needs. Consumers think most ads they see aren’t relevant to them, and those ads go neglected and ignored. This is a huge opportunity for you to seize a competitive advantage. If you make your ads relevant to every user who sees them, you can connect with them on a deeper level and stand out from your competitors. Personalization is one of the best ways to do this. A personalized ad recognizes each impression as an individual with unique behavior and interests. That makes it relevant and effective.

4. Know When to Stop Throwing Good Money after Bad

Knowing when to stop advertising to certain users helps media professionals make the most of their limited ad spends. Ads strain budgets when they’re shown repeatedly to users who won’t ever become buyers. Personalized ads save money because they show you when to cut your losses and focus on other users more likely to become customers. You can set frequency caps to limit how many times you display an ad to a user before moving on. And you can stop serving ads to someone as soon as they buy from you, as those ads are better served on people yet to become customers.

5. Retarget Based on Behavior

Until recently, advertisers didn’t have a good way to reengage users who visited their websites but didn’t buy. Now, personalized retargeting gives you the capability to follow up with a previous visitor wherever they go online, regardless if they return to your website. Users who visited a website previously are much more likely to become customers. Land Rover used retargeting to deliver personalized video ads to users who visited their website. They customized their ads based on the user’s location and the car model they browsed. This led to a 50% increase in brand awareness and 53% increase in purchase intent.

6. Maximize Your Up-Sell and Cross-Sell Potential

By personalizing their ads to offer up-sells and cross-sells shortly after customers make an initial purchase, advertisers put themselves in the best position to make even more money. Travel websites do this all the time. Just hours after a user books a hotel, it’s common for them to see offers for related travel activities like flights and car rentals. These ads are much more effective when targeted in this “golden selling window,” and that’s exactly what personalization allows you to do.

7. Get Higher Conversion Rates at Lower Costs

Businesses only have a limited ad spend to work with, and they need to make the most of it to thrive in today’s competitive environment. Personalization can help. Because advertisers are targeting individual users instead of a broader group, they don’t have to dilute their ads in an attempt to “appeal to everyone.” They can tailor them to fit unique situations and create a higher response. Businesses that use a system to deliver personalized ad experiences get an average of 50% more leads at 2/3 of the cost.

8. Give Consumers What They Want

Personalized ads aren’t just more profitable than generic ones. Consumers prefer them. There’s hardly a better way to show users you understand them. Personalized advertising makes them feel like more than just another data point. You tap into their behavior and preferences, and you connect with them on a human level. Consumer expectations have changed since the days of broadcast media. Unprecedented choice and control have created a demand for a customized media experience. Personalized marketing delivers that experience. It gives users a compelling reason why they should click on your ad instead of the countless others they come across every day.

9. Tailor Creative to Make Ad Copy More Effective

Programmatic helps advertisers buy impressions for users most likely to become customers. But it’s still up to the creative to convince the user to click on the ad and follow through. Personalization lets you tap into data and structure your creative in a way that gets attention and drives response. One appeal might work well for a certain user but not the next. With personalized ads, you can match the message to the user on an individual level. Your appeal fits users’ needs like a glove, and they’re more likely to click on your ad.

10. Improve Lead Nurturing

Another downside of generic advertising is the inability to tailor an appeal based on the viewer’s position in the advertiser’s sales funnel. Someone who has never heard of the advertiser before is exposed to the same message as someone who had been a loyal customer for decades, leading to a lot of missed opportunities. With personalization, you can analyze each user’s past interactions with your brand in order to display the right message at the right time. Displaying an ad for a specific product might not resonate with someone in the awareness stage of the buying cycle, but it could push someone further along to become a customer. You can tailor your messages to strategically nurture more leads into buyers.

The Key to More Personal (and Profitable) Connections

In an impersonal digital world, consumers are craving something more intimate. They want to know advertisers think more of them than as just impressions or data points. Personalized ads allows you to deliver that human touch in a compelling way. You cut through the generic copy and flashing banners screaming for their attention because your ads treat them as individuals with unique needs and interests. Consumers get what they want because they see advertisers understand and value them as people. And you get what you want too: increased engagement, conversions, and sales.