What will be the top personalization trends of 2023?
Personalization has changed the entire digital landscape
Today’s customers expect personalization, so brands must position themselves to succeed and build the necessary capabilities to excel. As the year draws to a close, read on to learn about our predictions for the top personalization trends that will shape digital marketing in 2023.
AI-driven personalization
AI personalization helps businesses increase engagement, grow sales and customer loyalty, as well as gain a greater understanding of their customers. It enables customers to quickly find the products they’re interested in, and which best suit their needs. AI personalization has a wide range of applications that benefit both brands and customers, including:
- Using machine learning and natural language processing, AI-driven personalization enables brands to aggregate customer data to better understand their customer base.
- AI-driven personalization enhances user experiences and drives strategic decisions and development.
- With AI-driven personalization, brands can analyze enormous amounts of data from multiple sources, which can be used to better understand insights, in real-time.
It’s a way for businesses to demonstrate that they’re listening to the needs of individual customers, and it helps establish a connection with each customer. Facial recognition technology – which matches a human face from a digital image or video – is likely to shape AI-driven personalization in the future.
According to research, the facial recognition market was worth around $5bn in the year 2021, and it’s predicted to reach $13bn by 2028. AI-driven personalization is likely to increase momentum in 2023 with facial recognition leading the way.
First-party data
As first-party data is owned by the brand, it offers greater insights into audiences, which can help deliver more meaningful and personalized marketing. With new data privacy laws restricting the use of third-party cookies, brands will need to focus their efforts on developing a first-party data strategy.
Google Chrome will be phasing out third-party cookies in 2024, which means brands must be more proactive in balancing the demand for personalization and privacy. That’s why different levels of data, including first party and second party, are likely to become a high priority for brands in the future.
Consumers aren’t as amenable when it comes to having their data taken without their consent. For many, the sunsetting of third-party cookies can’t come soon enough. Three out of four (76%) report being frustrated when brands suddenly appear to market to them because they searched online about the brand or a similar one. In addition, 83% believe their data will be more private when web browsers phase out tracking cookies. (CX Report 2022.)
First-party data will pave the way for a new era of personalisation and advertising. It’s one of the most valuable forms of data because it allows brands to build relationships with customers through platforms and media that they own. This helps facilitate stronger digital experiences and tailored marketing messages. Ultimately, first-party data enables brands to create a personalized experience for their customers without compromising on privacy.
Personalized loyalty program
Further afield, brand loyalty will continue to play a crucial role in retaining customers and driving profitability. Modern-day customers want honest, transparent information and to be aligned with a meaningful cause . Therefore, brands that offer loyalty program can build personalized offers based on customer data, which serves as a retention strategy to encourage customers to continue buying their products or using their services.
According to research, 75% of surveyed customers said they would switch brands for a better loyalty program. Brand loyalty programs are a way to keep customers engaged and to continue driving personalized experiences. For example, My Best Buy is a brand that offers benefits like earning points, free shopping, and the chance to receive special offers. Amazon offers their flagship Amazon Prime, which provides customer-centric benefits such as Whole Foods discounts and Prime Now delivery. Loyalty and personalization are interconnected, and brands that continue to offer personalized offerings will thrive in 2023.
Location-based marketing
Location-based marketing is another key personalization trend that’s already having a massive impact. It allows organisations to provide personalized experiences and messages to customers based on their location. Location-based marketing is a more granular approach to marketing, allowing businesses to focus personalization on specific customer segments with highly relevant and targeted offers.
Personalization has become a key driver for a variety of industries and marketers will need to invest in multichannel technologies to build the best digital experiences. In an increasingly digital world that offers a variety of choices, customers expect personalized experiences, so now’s the time for businesses to implement personalization strategies to create and sustain growth .
Acquia is a leading enterprise CMS platform, providing cloud platforms for building and optimizing digital experiences. Take a look at Acquia’s case studies to find out more about how customers have benefited from the platform.