The ROI of Marketing Personalisation


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By 2020, customer experience is expected to overtake both price and product as a key brand differentiator. Not all customers are equal, there is no ‘single experience’ that meets everyone’s needs. Every customer is different, and they respond in different ways.

Personalisation is by no means a new concept, many marketers have been using this strategy for years. However, customers are expecting a lot more these days. Brands such as Amazon and Netflix have revolutionised the way customers think about personalisation.

They now expect a brand to not only know their first name, but to also understand their behaviour and anticipate their future needs. There is a lot of expectation – and it’s showing no sign of slowing down.

When considering your customer strategy, personalisation must be at the heart. Are you creating journeys that are truly unique and personalised for each customer? There are great rewards for the brands who do. McKinsey state that personalisation can deliver five to eight times the ROI on marketing spend, and can lift sales by 10% or more. Think of what that would mean for your business.

Personalisation: where to start?

If you have any form of customer data, you can start personalising your communications.

If you have the customer’s address, you can also target them with local offers that are relevant to them. If I live in Sydney, then I’m not interested in restaurant discounts in Brisbane – I’ll delete the email without even reading it (or unsubscribe). If a customer unsubscribes, you’ve potentially lost that customer forever.

Rather than sending the same email to every customer, in which the only differentiation is first name, use the data you have to help you personalise. We’re referring to customer segmentation (not customer personas) to be clear. You don’t need to overcomplicate segmentation. A simple, yet very effective approach is the RFM segmentation model, which stands for Recency (when the customer last shopped with you), Frequency (how often does the customer shop with you) and Monetary value (how much the customer spends with you).

By simply segmenting your customers based on these three dimensions you will gain insight such as:

– your most profitable customers
– advocates of your brand
– customers who used to shop with you but haven’t been back in a while.

And much more…… but straight away you’ve got a glimpse into your different customer groups and will realise that each of these customer groups need to be communicated to differently. For example, your most profitable customers and advocates need to feel appreciated and valued. The customers who haven’t shopped for a while may need reminding of the brand value or a tailored incentive to return.

This strategy enables you to personalise based on the customer’s position in the customer lifecycle. Consider this approach as a way to nurture your customer relationships, instead of thinking about how you can just sell to them. By continuing the conversation with the customer, you’ll be in a much stronger position to drive customer loyalty.

Sophisticated personalisation through AI

There is no denying that technology is changing the way we continue our customer conversations. Artificial intelligence (AI) enables brands to deliver effective personalisation at scale. Technology provides algorithms that are designed to support personalised experiences. If you have quality data, carefully managed and executed AI can orchestrate experiences that are bespoke to individual preferences and behaviours. Personalised landing pages can be created based on the customers behavioural profile, promoting relevant recommendations and offers. Relevancy is key!

Predictive analytics helps brands predict future customer behaviour, for example: a customer is browsing your website, and based on the first few pages they visit, you’ll be able to predict which page they are likely to visit next – giving you an element of control on the customer journey. You can use personalisation strategies to promote the right content to them, at the right time – helping you to influence the customer’s future behaviour.


Personalisation is a strategic growth tool. To be truly effective at personalisation, you need to understand it’s value, and why it’s worth the investment.

Your objective is to deliver relevant, timely messages to the customer via their preferred channel. Assess the customer journey and determine personalisation opportunities across every touchpoint – by making some small changes, you could receive a huge return.

Segment your customers into different customer groups and consider the type of messages each of these customers should be receiving, consider the use of AI and how can you can use data and analytics to influence future behaviour.

72% of customers say they now only engage with marketing messages that personalised and tailored to their interests¹. If you’re not personalising then you are in a very vulnerable position indeed.



Michael Barnard
Michael oversees a team of Customologists with combined talent across strategy, data science, and technology, who help brands understand and influence customer behaviours. Michael’s experience in human centred design is foundational in our principles of design thinking and starting with the customer, focusing on how brands engage, keep, and grow customers.


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