2 or 3 years ago, ‘personalization’ became the hottest idea on the internet. Online marketers, web content specialists and internet-based companies poured billions of dollars into research for how to make it happen. The Aberdeen Group even went so far as to predict 2013 to be “the year of personalization”. Yet despite all the excitement, web and app personalization remained a pipe dream until recent times.
Today, true web personalization is finally a reality for everyone. But don’t be fooled: not all technology that claims to personalize is actually delivering on its promise.
So, what is personalization? And perhaps just as importantly, what isn’t it?
1. Segmentation ≠ Personalization
When conversations about personalization first came up, the most common mistake made was to assume that segmentation could be used in place of personalization. And it’s a mistake that is still being made by many web content specialists, leaving them with imperfect websites that they think are truly personalized.
So what’s the difference?
The key lies in understanding the distinction between group- and individual- level optimization. They might sound similar, but the results are drastically different.
2. Segmentation: Picking the ‘Winning’ Group
So what is segmentation, and how does it work?
Segmentation is an extension on the A/B testing theory that says you can find a ‘winning’ majority of users who like to see a website a certain way, and so that’s what your site should look like.
In trying to find a more precise solution, segmentation technology splits your users into different groups based on pre-determined criteria, such as:
- Whether they clicked through to your website from Facebook or Twitter
- What type of web browser they are using
- Whether they are accessing your site from a desktop, laptop or mobile device.
Once you form these groups (or ‘segments’), A/B testing begins to find a winner per ‘segment’. But there are a few problems with this:
Problem 1: Groups formed via segmentation may be inaccurate.
The accuracy of what you show is directly dependent on your original segmentation. But there is no guarantee that the groups and segments are accurate. It’s hard work to build correct segments given the myriad of inputs and ways to slice groups of people.
Problem 2: Many users still get the wrong experience for them.
Even with groups that are accurate, the nature of A/B testing means that a “winning” majority within each group will see the experience tailored to them. Large swathes of minorities within each group will have a sub-par customer experience.
Problem 3: Segmentation gets stagnant and it’s hard work to update.
Once you determine the characteristics of your segments, it is time consuming and cumbersome to change your segmentation. But if there’s one thing that’s constant, it’s that your users will constantly change preferences, interests, behaviors and habits. As your users’ preferences change, the original groups will no longer cater to them.
In an online world that lives and dies by maximizing impressions, click-through rates and purchases, cutting out such significant numbers of potential users can mean disaster. So how does personalization solve that problem?
3. Personalization takes Segmentation to the Individual Level
Personalization treats each individual user as their own unique segment. There are several key benefits that this brings:
Benefit 1: A.I. lets you understand each user on the fly so segments don’t have to be formed.
With artificial intelligence (A.I.) powering the personalization, you learn more about each user and their intent on the fly, based on their behavioral data and advanced machine learning algorithms. The guesswork of what any given user may prefer is immediately taken out, and you no longer have to suffer the consequences of leaving huge groups of visitors unsatisfied by forming inaccurate groups.
Benefit 2: You can cater to each individual user and give them the optimal experience.
As opposed to pre-determining groups for users to be lumped into, true 1:1 personalization seeks the ideal experience for each individual user who visits your website or application by adjusting content, layout, colors, order of what’s shown, etc., so that nobody is unsatisfied and everyone receives the optimal experience.
Benefit 3: Personalized websites can adapt dynamically to each user.
With segmentation, the natural conclusion for each group is a static display for the ‘winning’ majority. But as each visitor’s tastes change, personalization technology allows your website and app to automatically and continuously change with them. The result is a website that is always learning and always adapting, which leads to higher click-through rates, engagement and conversion metrics.
The potential for change that personalization brings is staggering. Though true 1:1 personalization is a relatively new technology, it is already showing remarkable success, and is creating a level of personal interaction on the internet that has never been seen before. By recognizing the wannabes, and understanding personalization technology for what it actually is, companies of all shapes and sizes can prepare to give the internet a major shake-up.
