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The Segment of One

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by Bryan Dollery
on

The ultimate in tailored, personalized marketing: The Segment of One. Handle with care.

Last week, we took a look at some recent predictions regarding digital tool sets, touching on how the demand for advanced analytics is rapidly growing. Now, we’ll go deeper into the crucial role that analytics will serve in the future of personalized marketing. This month’s Keyword is “The Segment of One”.

The Segment of One refers to tracking the activity and preferences of a single potential customer, then tailoring products or ads for that individual according to their behaviors. With today’s digital technologies as powerful as they are, achieving Segment of One marketing is well within the realms of possibility, since analytics tools can find meaning buried in the tremendous amounts of data we collect. With that information, marketers can accurately tailor and deliver messages that appeal directly to the interests of an individual, rather than the general interests of a looser demographic group.

With this in mind, the whole concept of the Segment of One sounds very appealing – personalization is the cornerstone of effective marketing, so ads that are targeted based on data pertaining to location, time and individual tastes are about as personalized as they can get. It’s not just about delivering the right message either, it’s about not delivering the wrong message. For example, ads for baby products sent to a consumer based largely on their age and/or sex can be frustrating for the recipient if they have no desire to have children; that individual will go on to develop a negative impression of that brand. So, while the Segment of One promises to show consumers more of what they want and less of what they don’t want, there are pitfalls to this seemingly perfect approach.

FAST FACTS

  • As much as 75% of marketers are failing to utilize behavioral data (1)
  • Ads that are targeted based on behavioral information have a 670% improvement of click-through rate over ads not behaviorally targeted (2)
  • Amazon have been granted a patent for a service where goods are shipped before they are ordered (5)

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Personalized messages can become predictable. Ads that utilize the Segment of One risk limiting the customer’s choice, choking the possibility of spontaneity. While people are generally creatures of habit, we are also inclined to explore. The initial burst of enthusiasm that comes with discovering something new can be instrumental in leading the consumer to make new and unlikely purchases.

Perhaps the Segment of One is useful for marketing certain products and services where the consumer’s data shows consistency. But by looking at spontaneous and less regular activity, we could draw links and determine underlying themes within that activity that perhaps the user themselves has not yet identified. It’s also crucial to observe cultural shifts on a wide scale and then link that to customer behavior. For example, while Pokemon Go has been nothing short of a phenomenon, there are those who are steadfastly against the principal of the game. An advert that parodies an aspect of such a trend is likely to attract the attention of both the ‘pro’ and ‘against’ sides – therefore, separating those two kinds of people into different silos could actually hold back the success of a campaign.

Technology should always serve to promote the development of creativity, not hamper it. As such, the high-accuracy predictions we can make from advanced analytics aren’t a reason for marketers to play it safe, but rather a call to marketers to further innovate their messages. Sometimes, the biggest risk is not taking one, and ads that become stale will push consumers to ditch one brand of a product in favor of its creative, daring competitor.

Want to find the optimal way to segment your customers?

Sources

  1. AdWeek: Always-On Marketing Study Finds Major Disconnect Between Executives’ Self-Perceptions and Reality
  2. Oxford Journals: An Audience of One: Behaviorally Targeted Ads as Implied Social Labels
  3. Marketing Week: How to make the most of predictive analytics
  4. Exchange Wire: Segment of One: Why Personalisation Could Become a Victim of its Own Success
  5. Social Times: 5 Ways Big Data Makes Your Marketing Irresistibly Personal

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