Personalization: The Key to Monetizing Your Content
Brands, it’s time to get personal.
Personalization is a term increasingly used in digital marketing, and for good reason — it effectively improves customer engagement, which drives revenue. For media companies, that means more revenues from advertising and subscription services. Although most companies acknowledge the advantage of personalization, 80 percent fail at using the strategy effectively.
In the media and entertainment (M&E) industry, keeping pace with the innovation consumers expect means that brands must get personalization right. They must provide targeted, customer-centric, cross channel, consistent experiences to grow and retain their audiences and to drive digital revenues.
Most media companies are already keenly aware they must move in this direction. Hulu and Netflix have done it. So has NBC Sports during the 2016 Summer Olympics. These companies used personalized content to create more connected experiences with consumers. Companies that have successfully incorporated personalization are seeing results. Forbes’ “Publish or Perish” report says that digital marketers who provide personalization on their websites are getting double-digit returns on their marketing campaign performance and response.
The move toward personalization isn’t a trend, but an undeniable shift that requires brands to act, not just react. To meet this challenge, M&E companies must use technology solutions like data management platforms and cloud-based solutions to develop a deeper knowledge of their customer segments, how to find and target the most valuable customers, and how to place audience centricity at the heart of their business and growth strategies.
Growth strategies for M&E companies
Select the right Technology. Technological advances such as direct to consumer OTT (over-the-top content) services, advanced advertising, and audience-based DMPs created new opportunities for media companies to grow and reach their audiences. On-demand content viewing forever changed the relationships consumers have with “primetime” TV. There is no need to wait or lament over missing one’s favorite programming. Consumers now can take their entertainment with them on their phones and tablets, and expect that every platform — OTT, mobile, or web TV to offer the same great experiences on the go as are available at home. Wearable technology is poised to be an important part of the Internet of Things, interacting seamlessly with other screens and devices and creating ever-more personalized experiences for their owners.
Provide more content. With an increased capacity for alternate distribution options, more and more content is created and delivered on every glass. Whether it’s articles, blogs or videos on websites, or new television or internet stations, consumers have access to an avalanche of content constantly available and constantly being replenished. The amount of content produced today is staggering. For example, every minute 400 hours of video are uploaded onto YouTube, the equivalent of 65 years of video per day. Digital blog content is increasing, with WordPress users publishing 347 new blog posts per minute. With so much information available, it is difficult for brands to stand out and to get their message to their target audience.
Exceed consumer expectations. With the avalanche of content and technological advances, consumers can literally hold their entertainment and media selections in their hands. Because of the plethora of options, consumers can afford to be selective. And they are. If a customer has a bad experience with a brand, they don’t hesitate to tell their 500 closest Facebook friends about it or to crowdsource to get recommendations for a replacement.
Ironically, a good customer experience presents challenges, too — when consumers have a positive experience with one brand, they expect that level of experience in all future interactions, with all brands.
These changes in the brand-consumer relationship affect all industries, from media and entertainment to retail to travel to business services. The age of the customer is here. Consumers are now firmly in the driver’s seat, with access to more information and choices than ever before.
The need for personalization
Consumers seek personalization. Given this dynamically changing landscape, brands must change how they interact with customers to engage with them, and personalization is key. Instead of providing consumers with what brands decide the consumers should have, brands must determine what consumers want, and deliver that product or information when the consumer wants it, via the method the consumer wants to receive it.
“We’re bombarded with so many devices, mediums, shows, books, movies, and albums to choose from, it’s almost overwhelming,” says Mike Brown, CEO of Fision, a leading provider of agile marketing software and solutions. “People are seeking better ways to curate the types of media and entertainment they should consume.”
Think about searching for a movie on Amazon Prime Video. With over 18,000 movies and nearly 2,000 television shows available, the choices of what to watch on a random Thursday night can be dizzying. But, when Amazon makes recommendations based on the consumer’s prior viewing or buying history, it makes the selection process easier for the consumer.
Creating that focused offering makes it easier for customers to buy, Mike says. He buys 12 audio books a year through a subscription to Amazon.
“I’m mostly buying the books they recommend based on my Kindle purchase. They’ve created this system where they know what I like to read in physical form so they then show me similar content.” In addition to providing recommendations, the content is available on multiple devices, in paper, digital, or audio form.
Brands must provide personalization. While it’s clear that consumers enjoy a personalized e-commerce experience, for media brands there are benefits, as well. To paraphrase an old saying, “if the consumer ain’t happy, ain’t nobody happy!” In other words, when consumers have a positive experience, everyone wins. Consumers are more likely to be repeat customers, and it costs significantly less to keep a repeat customer than to win over a new one. Even better — loyal customers spend more money. In the U.S., eight percent of repeat customers account for 40 percent of revenue.
Brands using personalization see revenue increase six to ten percent — two to three times faster than brands that don’t use personalization. The Boston Consulting Group forecasts that in the next five years in the retail, health care, and financial services industries, $800 billion in revenue will shift to the 15 percent of companies that get personalization right.
These statistics highlight the gains brands get with personalization. It seems intuitive that businesses would fully commit to being part of that 15 percent. But that’s not the case.
What is the future of content personalization?
Brendan Witcher, principal analyst at Forrester, recently said the next step beyond personalization is individualization — developing a rich collection of data that forms a more accurate picture of the customer. To be successful, the data must come from multiple sources — systems that are traditionally siloed in companies, he says. Ideally, companies won’t deliver what feels like personalization. Instead, Brendan says, it will just feel like a great customer experience.
The complexities from the age of the consumer are not going away. Media companies must use all the tools and technologies available to them to develop a genuinely customer-centric focus. Companies that employ technology effectively to identify, understand, and provide highly personalized experiences to their customers with engaging content will succeed, while those that hesitate to fully embrace personalization will be left behind.