Is advertising useful?
In our humble opinion, there are many formats that offer value to the people they target. Think of a voucher code that wipes a sizeable chunk off the price of someone’s next favourite outfit. Perhaps there’s been a reduction in the cost of boarding a flight to a dream destination; the display ads carrying that offer could be the difference between someone creating a new set of memories or staying at home due to lack of funds.
Improved levels of personalisation are helping advertisers and publishers generate an even greater impact with their campaigns. As a rule of thumb, the better someone can understand the person they’re targeting, the better placed they are to offer recommendations and be ‘of use’.
It’s an approach that works, too, as we can see from the following results:
- 70% of consumers expect personalised experiences from the brands they engage with [AgilOne]
- 56% of consumers prefer tailored adverts to random approaches from brands [DMA]
- The majority (56%) of consumers are more likely to use retailers that offer a personalised service [Forrester]
A growing list of surveys has proven that when brands are able to leverage the data they collect for useful purposes, there is less of an issue from the customer’s side. Unfortunately, there are times when things don’t go to plan, as shown by:
- 22% of consumers that receive a creepy experience will go on to shop with a competitor [InMoment]
- 54% of consumers feel “creeped out” by personalised ads [YouGov]
- 75% of consumers find personalisation to be “somewhat creepy” [InMoment]
The above comes on a backdrop of discussions over online privacy, GDPR and endless stories of companies misusing customer data. Of course, not all personalised advertising is necessarily bad or uncalled for – it just needs to use enough data to be informed of a situation, and not in a way that could be interpreted as creepy.
What is useful advertising?
Every advertiser will make a claim for their specific approach to communication being of use in some shape or form. The fact is, there is an extremely easy process to determine whether something is truly delivering value to the end user.
Experian’s research on the topic of useful or creepy advertising manages to summarise an answer within the space of five golden verbs. They are as follows:
Definition: When a customer is being compensated for completing the desired action.
Example: A customer receiving anything of value (a discount, cashback, loyalty points, experiences etc), often free of charge.
Definition: To remind the customer of a relevant event.
Example: A price tracker on an item that can fluctuate in value. Many flight comparison sites now offer these services.
Definition: Similar to the reward example, a brand can recognise something that a customer has done.
Example: Someone that spends over £100 with a retailer gets an email addressed to them containing a £5 voucher for their next purchase.
Definition: Any form of support that can answer a question or assist the customer in some way.
Example: An online tool that calculates someone’s mortgage payment based on their deposit, term and interest rate.
Definition: The ability to supply an accurate and valuable recommendation.
Example: Product suggestions from a digital “personal” shopper.
There are formats which manage to cover a number of bases. As co-founder of RevLifter, an e-commerce tool that only offers discounts and other incentives to the consumers that retailers actually want to convert, I’m proud of how we’ve been able to integrate a few different approaches into our service.
We add value to the customer experience through retailer-branded deal pages that contain offers specific to the person viewing them. It might be that someone is spending above a certain amount (recognise) and they qualify for a discount (reward) should they manage to hit predetermined criteria (remind). The pages can even act as virtual assistants by inviting them to complete a look or bundle (choose) to secure a better deal.
Think of it as having a store assistant for each of your customers; one that knows who they are, what they want and what your goals are; to raise AOV, grow international sales, convert new customers or all of the above.
Everyone gets offer fatigue, so knowing a realistic upsell is important. Retailers are great at making sure they hit the right level of upselling and RevLifter allows them to find the perfect pitch for each consumer.
Experian’s study into the differences between useful and creepy advertising provides further clues around what customers will accept when it comes to the personal touch. According to the research, formats that offer deals or relevant information can usually expect a nod of approval:
Aside from discounts – something that consumers will rarely turn down – it’s safe to say that online tools are another promotional mechanism acting in the customer’s best interests. Here, we see an example of the value exchange between consumer and brand, where personal data is traded for the answer to a question on financial products, a suitable holiday destination or similar.
Admittedly, coupon hubs and online tools are not cast-iron examples of “advertisements”. They use personalisation to advertise and market the service of a business but fail to offer the same sort of familiarity as online display.
Banners and skyscrapers are valuable to brands whose goal it is to build awareness around a product, a service or themselves. However, when applying a layer of personalisation, do they offer any kind of usefulness?
The better question is, are they creepy? In the case of a very generic piece of retargeting, something that reminds you of a website or product, you can arguably take or leave what it’s saying. Where things can go wrong is in badly executed campaigns, in which personalisation can have a negative effect.
Where things get creepy
One of the big triggers for consumer anguish towards personalisation tends to be when their data is used to inform the content of an ad, but from a company they haven’t engaged with. YouGov analysis shows that 87% of consumers will accept personalisation so long as it is relevant to them, while 67% find it intrusive from brands they haven’t shopped with.
It’s the kind of reading that should sound the death knell for third-party data within personalised targeting, but this will not happen for a while yet. Lists of in-market customers are continuing to trade at a high price and there will always be reports that show these campaigns to be returning a good performance, despite the apparent levels of discontent. Still, in the cases where a customer should legitimately wonder how an advertiser knows who they are, there is always the risk of being branded as creepy.
Some analysts believe that regardless of how much data is used and the company that’s leveraging it, the difference really does boil down to the service at hand.
When someone heads to Google in search of a voucher code and manages to find a page that is filled with offers geared specifically around what they’re buying, is that creepy? It could come as a welcomed surprise, given its relation to their original query.
Now let’s think about when a customer goes in-store to make a purchase and supplies their email address for ‘exclusive offers‘. That afternoon, they receive a message addressed to them, complete with details of their in-store visit, and a hoard of completely irrelevant product recommendations. If this is a taste of what’s about to come, the unsubscribe button should be made very obvious.
Both formats use data to communicate with a customer. However, given that only one is likely to be of any use, there are no prizes for guessing which could be branded as creepy.
Another big point to make is around the topic of subjectivity. Who decides whether something is creepy or useful? According to YouGov, someone aged 55 and over is 31% more likely to be irritated by personalised information, ads and recommendations than someone between the ages of 18-24. A graph showing results from this area of research gives the impression that dissatisfaction rises in tandem with growing older.
What advertisers can learn from the above is not everyone views things like advanced targeting in the same light. It’s a point they should already be aware of – given their use of personalised advertising – but one that must carry a great deal of influence on their work.
How can I be cool?
As a checklist for moving forward, remember the golden five verbs. If the ad is not rewarding, recognising, reminding, recommending or supporting, is there any way that it can be?
If you’ve purchased the data you’re using to target the recipient, there is a good chance that some users will be put off by receiving personalised messages from someone getting in touch for the first time. The pressure is then on you to really add value through the experience you can offer; to almost justify the reason for getting in touch.
You must be transparent about the exchange of value between you and your customers, implicitly reminding them of what they’re getting in return for their data and ensuring your T&Cs are up to date.
Finally, the reception towards personalisation clearly differs between age groups and audience demographics, which is why you should think carefully about the person you’re targeting. While a younger, more digitally influenced consumer might feel at home with product suggestions based around ‘cool’ facial recognition technology, someone approaching 60 might not feel the same way.
In the era of data-driven, hyper-targeted personalisation, the invisible line between cool and creepy is a tough one to toe, but there are plenty of clues to lead the way.
By Ryan Kliszat, co-founder, RevLifter