Personalization Increases ROI of Email Marketing in Recent Study

• Updated on: 2018-10-08
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We often think the benefit of online marketing to be the ability to reach millions of people at once, but that's only half of the equation. The other benefit of digital media is the ability to connect to millions with precise targeting and to still be personal. An example of this can be seen in email marketing. A recent study by Monetate showed that personalizing emails had a large effect on results of a campaign.

When you check your physical mailbox, there may be direct mail marketing messages. Some may have your name while others are simply addressed to the "current resident". People are more inclined to pay attention to the mailers with their name on it compared to ones with generic greetings. The same is true of email marketing, there is a growing evidence to show that personalization matters to email recipients.

Monetate, a personalization software company, recently surveyed 131 professionals with marketing-affiliated positions at the end of 2016 to see how their campaigns performed and the tactics they used. According to the 2017 Personalization Development Study based on the survey results, those that that exceeded their company's revenue goals had a dedicated budget for personalization 83 percent of the time.

While this study can't show a cause and effect relationship between email personalization and better results, it does show a strong correlation. The marketers who saw the best results and return on investment were often using personalization. Four out of five (79 percent) marketers who exceeded revenue goals had a documented personalization strategy. Only 8 percent of marketers that missed their revenue goals last year had a dedicated investment in personalization.

This doesn't mean that marketers who don't use personalization are doomed, but it means they will have to work harder to achieve the same results.Of the marketers surveyed by Monetate, only 31 percent that just met their goals utilized personalization. To put it another way, marketers that used personalization were more likely to exceed their revenue goals, while those that didn't use personalization were more likely to meet their goal or to under achieve.

Something similar can be said about using personalization software and tools. According to Monetate, 88 percent of those that exceeded revenue expectations have personalization measurement systems in place (compared to 42 percent that missed goals and 47 percent that met them). Again, personalization systems correlate to better performing campaigns.

The study suggests that marketers with a framework for advanced personalization see a higher return on investment for their email marketing efforts.

"The biggest takeaway from Monetate's recent personalization survey is that for those that do put in the effort, personalization is not only attainable -- it also impacts an organization's profitability," says Maribeth Ross, senior vice president of marketing at Monetate, according to media reports.

The '2017 Personalization Development Study', also revealed that those marketers who exceeded their revenue goals were far more likely to use personalization in triggered emails. Marketers who exceeded revenue projections used personalization in triggered campaigns 78 percent of the time, compared to just 57 percent of marketers who met their goals and 62 percent of those that missed them.

Though based on a relatively small sample size, the study from Monetate should give business owners and marketers reason to consider adding more personalization to the online marketing campaigns whenever possible. Email marketing can help business owners reach many people at once, but personalization makes each message feel unique for the user, even if only a little.

For more recent research about email marketing, read this article on the benefits of having a high reputation score for email deliverability.