Section 1: What’s Content Personalization?
Industry giants such as Amazon, Facebook and Netflix have been relying on content personalization to increase engagement and sales for a number of years. Corporations have come to realize that content that is personalized to a user’s behavior, preferences and characteristics is far more engaging than generic content.
Various Forms of Personalization – Personalization has various forms – each with its unique set of pros, cons and applications. You can personalize a greeting, a pop-up, a call-to-action, to name just a few. At the highest level of personalization, the whole web experience can be altered and adapted to the preferences and needs of the individual user.
What Can Personalization Be Based On? Before you personalize the content, you need to identify who you are personalizing the content for, which is the process of segmentation. Some of the most commonly used segments are based on:
- Situational data (i.e. location, weather)
- Profile data (i.e. age, gender, profession)
- Historical data ( i.e. browser and purchase history)
- Behavioural data (i.e. on-site behavior)
The way one leverages personalization, both its form and what criteria it is based on, depends on specific needs. For example, where it might make sense for Amazon to use browser and purchase history, Netflix would be much better served by personalizing according to on-site behavior and user preferences.
Section 2: Why Should I Care?
You should care because a majority of your website’s visitors do. About 3 out of 4 visitors get frustrated when presented with irrelevant content. Furthermore, marketers who implement content personalization on their site, see an average of 19% increase in sales.
As such, many marketing experts and companies are now recognizing the importance of personalization. According to a recent report from Evergage, 85% of organizations are using personalization as part of their marketing strategy. Among organizations who presently do not use personalization, more than of them intend to implement it by 2017. If you still need more reasons to care, head down to the case studies section – see how Amazon, Facebook and Netflix used personalization to build their companies up to where they are today.
Section 3: The Psychology Behind Content Personalization
Information Overload – The reason that content personalization can be so effective is that its effect has underpinnings in social psychology. A common problem overcome by this strategy is information overload. With every new piece of information or content presented to us, we’re faced with another option that we have to evaluate. This means that there is yet another decision to be made.
The default human tendency is to think that multiple choices are better in almost any scenario – but research shows that in truth, we hate having to choose. As a result, we avoid doing so. This concept was validated by Sheena Iyengar in the book “The Art Of Choosing”. In the book, she describes what is now known as ‘the famous jam experiment’. She set up a stall at a market offering samples of jam. Every few hours, she switched between offering a selection of 6 jams and 24 jams. Customers tended to taste 2 jams regardless of how many options there were, and each customer received a $1 coupon for a jam. But what they found next was interesting: fewer customers stopped by when there were only 6 jams on display. Clearly the large choice of jams was capturing people’s attention and drawing them in. And more potential customers means more sales right? Wrong. What she found was that 30% of people who tried one of the 6 jams sample went on to buy, whereas only 3% of people that were presented with the choice of 24 jams made a purchase. In the end, giving people a narrower selection resulted in 10 times more sales.
Whether we are consciously aware of this or not, the presence of more choice is debilitating. Why? Consumers don’t want to feel like they could have done better. They want to be satisfied after a purchase, but when you offer them 24 kinds of jam, there’s always that nagging feeling that there could have been a slightly tastier jam out there that you didn’t buy. To overcome this anticipation of regret, customers choose to cut their losses and leave without buying anything.
Whether online or offline, a customer presented with too many choices is less likely to buy, or engage. Facebook knows this. There are on average 150,000 posts competing for our attention at any one time. If Facebook tried to show all of them to users, they know that the information overload would cause users to abandon browsing the site. Instead, they present each users with a personalized newsfeed that is carefully curated and contains stories that are proven to engage that particular user. Instead of showing me all 24 jams, they show me the 6 they know that I’ll like best.