Retail is an early adopter of personalization in digital advertising.
When consumers were polled by Innovid, an independent advertising and analytics platform built for television, on which industry they want to see personalized digital advertising in, a full one-quarter chose retail, followed by entertainment (18%), CPG (14%), hospitality (11%), QSR (10%), automotive (6%), telecom (2%) and financial services (2%). Further, when asked to identify brands that personalize effectively, respondents picked Walmart, Apple, Nike, Target, and Kohls — all of them retailers.
“While retail is an early adopter of personalization, all verticals can and should take advantage of the benefits of personalization,” said Stephanie Geno, SVP of marketing at New York-based Innovid. “Not only does dynamic creative improve relevance, it can help brands quickly address massive industry interruptions like what we’ve seen with COVID-19. Marketers that have the flexibility to swap out creative in real time and adjust messaging on the fly can appeal directly to consumers during challenging times and maintain consistent, meaningful connections.”
More broadly, 43% of respondents said that it was important that the online ads they see are personalized, incorporating geography, interests and behaviors, while 29% said they that would be more likely to buy something if an ad was personalized. Personalization also affected loyalty, with 31% saying they tend to be more loyal to brands that regularly make use of personalized ads.
However, while the ability to engage customers across marketing channels has gotten better, just 3% of U.S. companies currently take advantage of true omnichannel personalization, Innovid noted, citing eMarketer research.
“Advertisers aren’t doing enough to personalize across channels, despite strong demand among consumers,” observed Geno. “COVID-19 is also accelerating the need to be more personalized, as a one-size-fits-all approach in this environment can turn off customers, hurt your reputation and undercut revenue.”
Innovid found that social media platforms deliver more personalized ad experiences. Forty-five percent of respondents said that they see more personalized ads on platforms like Facebook and Twitter, while 20% said websites, 15% said YouTube, 13% said connected TV (television with integrated internet and interactive features, also known as smart TV or CTV), and only 3% said streaming audio.
When asked what type of personalized ad they would pay attention to the most, respondents went with social media most often (18%), paced closely by video ads (17%) and TV ads (17%). Website banner ads (13%) and audio ads (2%) garnered the lowest consumer interest.
“Consumers have articulated their desire to see personalization in social, digital video and CTV advertising.” noted Geno. “Brands need to use data to develop a more tailored, omnichannel strategy to engage and connect across all channels.”
When it came to devices that drive personalized ad engagement, mobile was the top choice, with 34% saying that they’re most likely to click on a personalized ad on a smartphone or tablet. Thirty-three percent opted for desktop, while fewer respondents picked “any device” (6%), Smart TV (4%) and gaming console (1%).
“We recently examined campaigns across more than 600 advertisers and found that interactive ads on CTV produced an engagement rate almost six times higher than mobile,” said Geno.“Although interactive CTV ads are currently underutilized by brands, they repeatedly outperform every other format and device. We predict as more brands embrace what is possible through interactive ads, clicking a CTV ad will become a learned behavior similar to engagement with ads on mobile and PC.”
When asked to rank the types of personalization they prefer, 39% responded “ads that understand and address the context of my moment,” such as the site they’re visiting or the show they’re watching, followed by “ads that incorporate general demographic information about me” (31%) and “ads that understand and address my online activity and preferences” (29%).
As for what types of personalized ads they’d be most likely to click on, 41% said “events that interest me.” The other top answers were “offers on products in which I’ve shown interest” (38%), “new products or services I may like” (34%), “ads about my local community or from a local business” (26%), and “ads that help me learn more about a relevant topic or subject” (21%).”