Personalization is hot again. 

Just when some believed the term “personalization” was in danger of becoming outdated, there seems to be a revived interest in it. The term is still misunderstood and for that reason is often not used.  New terms like behavioral targeting, precision marketing, and micro segmentation now come up in common marketing conversations, and often replace the more general notion of personalization. But the concepts are still the same and the value is even greater. Content targeting, collaborative filtering, one-to-one marketing, guided navigation… these are all personalization concepts that have been around since the 90’s. But it seems eTailers have finally moved beyond the early hype cycle and have found practical ways to implement and manage dynamic sites that “personalize” the experience, segment their sites and improve the quality of their recommendations.

By most people’s definition, personalization is about delivering “the right content to the right person at the right time through the right channel”.   What is the right content?  The simple answer… the content that converts the looker to a buyer or the one-time buyer to a loyal customer. 

At the heart of managing personalization is the ability to dynamically modify or configure the content of a web site based on who the user is, what the user is doing, or what the user saw, bought or saved.   Why is this easier today?   The difference today is in the easy-to-use business tools that give marketing managers and merchandisers the ability to easily define online segments, tag content (products, reviews, articles, etc.) and create rules to fully-automate real-time intelligent targeting.  Implementing personalization no longer requires Java PHDs and savvy Java scripting that is hard to maintain.

Why is personalization more effective today?  One theory I have… sites are taking a more basic approach.   Rather than implementing rocket science technology to “guess” at customers’ intents and preferences, eTailers are simply asking web site visitors a few key questions like brand preference, price range, product attributes, lifestyle questions, etc.  This information enables very accurate recommendations. The key: consumers, especially the younger generation, are more willing to share information online in return for this “value”. A recent article in eMarketer.com discusses how consumers generally like personalized offers, at least on e-commerce Web sites.  And although one-third of respondents to an Avenue A | Razorfish study were concerned about the privacy implications of personalized recommendations, more than seven in 10 said they found them helpful.

My caution to eTailers: Some of you are abusing this power and using consumer provided information to spam them.  This abuse of consumer information will create distrust with your brand and distrust with the general online shopping ecosystem.  Consumers are willing to partake in an online dialogue with online sellers.  If you focus on returning immediate “value” in return for sharing information, consumers will share.  They want you to help them find the right product or the good deal or the interesting accessory.  But if you begin to intrude upon their lives and take up their scarce time reading junk, they will begin to balk at this sharing.

[tags] personalization, behavioral targeting, precision targeting, micro segmentation, do not track, e-commerce, online shopping, Web advertising, Web marketing [/tags]