Personalization vs. Individualization – What’s the Difference?

How to Meet Your Individual Customers Exactly Where They Are

As online privacy and technology evolves, we continue to see an increased reliance on first-party data. At the same time, we’re learning more and more that audiences want marketing messages that utilize psychographics and speak directly to them. While “personalization” is a part of the conversation, “individualization” is just as important of a term in today’s marketing environment. Before we get into the differences between these two customization practices, let’s take a quick look at marketing tactics and how they’ve evolved over the course of recent history.

A (Very) Brief History of Recent Marketing Tactics

Although one could argue that brands as we know them started when marks and emblems graced handcrafted goods in the years BCE (Before Common Era), the official kickstart to marketing as we know it today stems from practices set forth during the industrial revolution. Innovation, discovery, growth, mass production, infrastructure improvements, and the rise of mass media all opened the door for producers to create products that met customer needs. Of course, with more companies creating and selling goods and services came the need for marketing to help companies stand out from the rest and win customers over. With this competitive environment, we’ve watched marketing grow and evolve to what it is today.

More recently, marketers have been able to connect and engage with their audiences in new ways. With each year, it seems marketers can target their specific audience(s) more and more precisely. This increase in precision can be viewed as a funnel, with each tactic progressively narrowing down the marketing message until it speaks directly to the individual. Let’s break them down:

• Mass Marketing: A cheap and scalable tactic that gives you the ability to connect with many people, but no way to segment your market.
• A/B Testing: Also known as split marketing. It’s recommended you hold off on this method until you have at least 1000 (minimum) conversions to analyze. And, you’d need an additional 250 responses per test to even parse through the data.
• Segmentation: The process of differentiating groups by different categories (segments). By separating portions of your audience, you’re able to better serve particular markets (you can learn a little bit more about segmentation by checking out this blog).
• Personalization: Like the name implies, this tactic is about personalizing your messaging using things like first names, addresses, personalized URLs, content, imagery, and more. Basically, this strategy shows each audience member content that’s directly related to their demographic and geographic data.
• Individualization: With this fairly new tactic, you’re talking directly to the recipient using first-party data. With this data, you’re able to connect with them and cater to their personal experience at every touchpoint. Read on to understand how…

As businesses grow more in tune with their audience(s), they’re able to better connect with individuals and create more carefully crafted, personalized marketing experiences all along each customer’s individual customer journey. And, while personalization and individualization may sound quite similar upon first read, there are some key differences between them.

Personalization (An In-Depth Look)

Personalization uses general data – past purchases, user login information, and more – to address the audience’s personal information. There’s a balance that must be achieved between company transparency, consumer choice and privacy, and accountability. The information that’s used in personalized marketing is usually along the lines of name, birthday, and address. Here are a few numbers to consider when approaching personalization:

• 75% of customers are more likely to buy a product based on personalized recommendations
• 49% of consumers say that after receiving a personalized recommendation, they’ve bought a product they didn’t intend to buy
• 26% of revenue comes from the 7% of visitors who clicked personalized ads
• 69% of consumers would share personal data in exchange for more personalized product recommendations
• 1 in 3 consumers (38%) say they’ll shop with a brand they’ve had a good experience with again, even if there are cheaper or more convenient options
• 62% of consumers say a brand will lose their loyalty if they deliver an un-personalized experience, up from 45% in 2021
• 35% of companies feel they are successfully achieving omnichannel personalization, up from 24% in 2021

With tech giants like Apple and Google implementing and following new privacy regulations, it can feel like companies are scrambling to collect, manage, and protect first-party consumer data in a responsible manner. The ending of third-party cookies has made way for new technologies to deliver the personalized experiences consumers have come to expect. These tools for understanding and engaging customers have created opportunities to reach customers on the channels they prefer most while also delivering personalized experiences across multiple different channels. So, while personalization is often effective in connecting with individual consumers at a demographic level, there are times when you may need a bit more targeted focus in your marketing to convince potential buyers…

Individualization (Under the Microscope)

Instead of communicating with customers based on demographic segments, individualization helps you connect with them as a specific, unique people with particular and distinct needs, preferences, and habits (also known as AIOs – activities, interests, and opinions). 78% of people say they’re more likely to recommend brands that customize their experiences, and those 78% are more likely to become repeat shoppers, as well. With information that customers have voluntarily provided – such as through a form on your website – you’re able to leverage first-party data. With that power comes the responsibility of transparency with your customers about how their data will be used. By doing so, you’re allowing the customer to feel protected and building a strong foundation of trust. When you have the right privacy barriers in place, you avoid presenting yourself as invasive and untrustworthy.

Let’s think about an example scenario. You’ve received the name of a customer – John Smith. After John purchases a new fitness watch band and running sneakers, he fills out a form on your website to log in and track the package of products. With the information John’s provided on your site, not only can you give him a discount off his next purchase but can also make custom recommendations. Maybe you’d next recommend socks or athleisure wear, or a discount on dumbbells. It all depends on his activity on your site, his information, and any other details you can get from his purchase(s). And, as he continues to visit your website, you’re able to go beyond just an offer based on his address and age. You can provide an experience based on his individual data and actions over time.

Looking to the Future

As it becomes increasingly necessary to utilize first-party data, we’ll continue to see a push to connect with the customer at every part of their journey using new, ethical tools and tactics along the way. Although personalization is still key, there will often be times when individualization is necessary. And soon, it may be the only way to market to (as we’ve said above) customers that now expect highly customer-centered marketing.

Crafting a highly personalized or individualized multichannel campaign can feel overwhelming, but you don’t have to do it alone! Contact us today and connect with our team of marketing experts, print specialists, and digital advertisers!