The Problem With the Era of Personalization
It was nearly 30 years ago that Tim Berners-Lee developed the first web browser, WorldWideWeb. As someone who has made a career helping brands harness the power of this spectacular innovation to sell more products and services, I would be remiss not to cogitate on both the opportunities and obstacles that have emerged in the wake of this digital revolution. Specifically, the interminable quest to deliver greater relevance and personalization, which is deceptively simple and yet endlessly complicated.
Many great minds have opined that information has emerged as the world’s newest and most valuable currency. After all, information was the original promise of the internet, and the pioneering technologies that have helped organize and deliver the myriad of information would be its original sin.
As a consumer, and better yet a marketer, access to the world’s documented information is beyond powerful. This is regularly apparent when we research a product, find its highest-rated version, best price and ultimately make the purchase. However, the never-ending desire for technology to organize and deliver increasingly relevant information comes at a tremendous price. The gains in “personalization,” conversion rates and lower customer acquisition costs — the gains in marketing efficiency — are offset by the drawbacks afforded by the algorithmically-driven life. In an increasingly digital world, we all now live hypercurated experiences in which algorithms often determine what information we receive or don’t receive. What you see and experience is different from what I see and experience.
As a marketer, sure, increased personalization helps to reach the right audiences more effectively and cost efficiently. But as a consumer, heightened personalization means that I’m potentially (and frequently) missing out on a sea of information, including other opinions and viewpoints (that might not align with my thinking), and even important facts. I believe this is one key factor that has contributed to the increasingly pervasive tribal mentality of “us” vs. “them." It isn’t hard to see that the U.S. is currently so politically polarized that each side has a completely different view of the truth.
Generally speaking, advertising tactics can be bifurcated into two opposites: demand-driven tactics and discovery tactics. Demand-driven tactics are defined as marketing initiatives designed to capitalize on your existing interest and plan to purchase. Discovery tactics, conversely, are defined as marketing initiatives that introduce products/services to you de novo. Discovery initiatives are designed to inspire, provoke or bring to consciousness that which previously hasn’t been present. Of course, there's a broad marketing spectrum connecting the demand-driven and discovery bookends.
If demand-driven marketing is intercepting buyers in-store who are eventually heading to the checkout lane, discovery marketing is the act of bringing more customers into the store.
Discovery tactics work efficiently when they're relevant and personalized (read as algorithmically driven). Just think about the ads you see while scrolling through your Facebook or Instagram feeds. If you're like most, they're highly relevant and, often, they're from brands you’ve never heard of before. While these discovery ads don’t convert at the same rates as demand-driven advertising, they do have much higher-than-average conversion rates. However, relegating your discovery marketing to be algorithmically constrained is limiting and a surefire way of missing new audiences and greater opportunities for scale. I’m not advocating to abandon the competitive edge that relevance in your marketing provides, but rather, I’m positing the argument to define and protect budgets that are designed to find new audiences and expand your reach beyond those individuals who the data would say are your most likely customers.
Jeff Adelson-Yan is the president and co-founder of Levelwing, a digital marketing agency specializing in media, analytics, creative and social.