When your inbox is full, which emails do you read first? The ones that are personally relevant to you, right? What about when you’re searching for information or advice? You probably hit the sites you know and trust first. Your customers are no different—they look for content that is personalized, trusted, and relevant.
In today’s digital era, if content is king, personalization is what gives it its power.
Personalization is about creating content and messages that a consumer will recognize as uniquely his or hers. It goes beyond customization to proactively create a sense of personalized relevance to drive action, engender a feeling of personal trust, and reinforce positive brand/consumer relationships.
The challenge facing brands today is how to, effectively and efficiently, leverage personalization across their entire customer base and target market.
Market Segmentation Methods
Segmentation is traditionally used to divide a broad target market into subsets of similar consumers. This is done based on demographic characteristics like gender, age, and income or based on psychographics such as shared interests, personality, attitudes, values, and opinions. Typically, segmentation is based on a combination of these characteristics.
Segmenting by developing buyer personae came about as a way of bringing different buyer types to life by creating fictional character profiles. Personae can serve a useful role by enabling marketers to feature or prioritize products, product attributes, or service options appropriately for each profile.
And while knowing the target segment is essential, knowing where they are in the customer lifecycle is equally important. How you communicate with a new customer is very different from communications with a long-time, loyal customer. So, segmentation should also factor in lifecycle stage.
By definition, segmentation—whether based on demographic, psychographic, buyer persona, or lifecycle stage—targets common traits and characteristics. The opportunity today, however, is to target and connect with consumers based on their individual behavior, activities, and interests.
We think of personalization as the use of targeted content that is highly customized to individual customers, not a generalized group. We refer to this as true personalization.
For use, true personalization:
- Is based on individual customer attributes
- Allows for targeting based on one or a combination of those attributes
- Customizes a communication so the reader gets specific, tailored content
Personalization can be as simple as addressing the customer by name. Last year, only 22% of email messages included a name, location, or other identifying information; that’s down from 25% five years ago. And that’s unfortunate, because personalized emails get 26% higher unique open rates and 41% higher unique click rates than non-personalized ones. 
Personalization can also be based on primary data collected from a variety of sources, such as past product preferences and actual purchase behavior. And if marketers gather specific data about a person’s actions as they move along the buying journey, they can use it to send a customized series of communications at key stages.
True personalization is the marriage of traditional segmentation and data to form a relevant, emotional connection that creates loyal customers and maximizes their lifetime value. It requires more resources and information (e.g. research, technology, data) than traditional segmentation. And that’s why, according to a recent Forrester study, less than 1 in 5 digital marketing decision-makers ranked multi-channel personalization as one of their top three goals. We believe that in this age of the customer, when building relationships is paramount to building loyalty, it’s an important consideration to make when allotting marketing spend. ReturnPath “The Email Subscriber Experience 2008-2013” (2013)
 Experian “2013 Email Market Study” (2014)
 Forrester “Refresh Your Approach to 1:1 Marketing” (2014)