How to Improve Your Personalization Approach with Taxonomy

In the last five years, we’ve seen an explosion of tools that allow marketers to personalize audience experiences. With these advances, you might think that personalization is easier now. However, we’ve seen that greater flexibility, channels, data, and possibilities can make personalization more daunting. As Orson Welles once said, "The enemy of art is the absence of limitation." This is also true with personalization, because providing marketers with unlimited options can bring their decision-making to a stand-still.  

When you’re confronted with a complex task, it's helpful to break the task into more manageable pieces. That’s why we’ve developed the following taxonomy. We created it based on our experience helping clients deploy personalized experiences across channels and platforms. This taxonomy explains buzzwords, creates a shared vocabulary for your team, and provides an outline you can use in your approach to personalization.  

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1. Identifying your Goals: Operational or Value Add 

Operational personalization provides business-critical experiences that, if not created or applied incorrectly, would break a process or experience. For example, a personalized dashboard showing a user's account balance. Value Add personalization provides promotions, content, and features that add value to a user’s experience. These personalized experiences improve engagement and loyalty but won't break anything when they’re not there.  

This framework determines the teams, tools, and support needed to deploy and maintain a personalized experience. Value Add experiences are tested and adjusted quickly because they have a low risk of negatively impacting a user’s experience (perhaps you recommend "Shoes" when they prefer "Jackets"). Operational experiences require more planning and long-term maintenance. 

2. Selecting Your Targeting: Broad, Niche, and Individual 

For some businesses, Broad segments are appropriate for personalization because their personas are well-defined and can be counted on one hand. For example, academia has well-defined segments like "prospective students", "current students" and "faculty".  

In other scenarios, however, Niche segments are required because there are many, small audiences that benefit from tailored experiences. For example, a publisher with 20 different content topics who wants to tailor experiences for audiences who have a strong interest in less-popular topics.  

Finally, targeting individuals is appropriate when algorithms can receive unique attributes about users and provide them each with a unique experience. For example, the Netflix home screen is different for each user thanks to algorithms, not humans.  

Using this framework allows you to set expectations about the work needed to define and deploy personalization. It's much easier to plan experiences for broad segments than it is for many niche segments. Similarly, personalizing to individuals requires that you have the right data and tools.  

3. Narrowing Your Footprint: Single-Channel or Multi-Channel  

Single Channel personalization, focuses on a single channel such as a website, an app, or an advertising channel. Multi-Channel personalization attempts to identify users across channels and provide them with a consistent experience. For example, you may receive an email follow-up if you leave an item in your website shopping cart.  

The power in this framework is in identifying which parties should be involved. Multi-Channel personalization requires collaboration across groups and shared data between technologies.  

4. Deciding Your Touchpoints: Static or Sequential 

Static experiences exist on a single channel using a single set of criteria. For example, you can show a homepage banner promotion to returning users. Sequential experiences, use past user interactions to create an evolving experience over time. These are often called "Drip" or "Nurture" campaigns. For example, after earning a lead you may provide them on-boarding materials, then sales materials, then a follow-up for a product demo. 

This framework lets you set expectations about the process, people, and technologies necessary to develop more sophisticated, sequential experiences.  

5. Choosing Your Implementation: Manual or Algorithmic 

Manual experiences are crafted by marketers themselves. For example, a marketer may define a nurture campaign that suggests three specific how-to articles across three emails. Algorithmic experiences, take lots of information as an input and produce a resulting experience for each user. Velir’s experience with Coveo’s personalization engine, which uses each user’s search history as an input, is one example. 

Leveraging this framework helps you understanding the systems and tools needed to deploy an experience. For example, Google Optimize provides powerful tools for creating Manual personalized experiences, but it doesn't provide any features to support Algorithmic experiences. Conversely, Adobe Target provides both. As a rule of thumb, if someone mentions "Machine Learning", they are talking about creating Algorithmic experiences, not Manual.  

Applying These Terms 

An immediate way to apply these terms is to evaluate your existing ideas for personalization. By breaking down a potential personalized experience into these components, it becomes easier to communicate needs and expectations. This can be especially helpful in evaluating vendors to see whether they can accomplish your desired result.  

Let's say your boss comes to you suggesting a new widget on your website's homepage that promotes a book based on each customer's purchase history. You could categorize this as:

1. Value-Add 
2. Individual 
3. Single-Channel 
4. Static 

5. Algorithmic

The next day, a colleague suggests a nurture campaign across email and your mobile app that shares helpful tips to your freemium customers. This would be:

1. Value-Add 
2. Broad (the segment is "freemium customers") 
3. Multi-Channel 
4. Sequential 
5. Manual 

With these categories established, you can weigh the two suggestions against your existing tools, skills, and marketing stack to evaluate implementation effort and business impact.  

Personalization tools have become more sophisticated, but that means they often require coordination between several teams. Hopefully these frameworks provide a shared vocabulary that you can draw from when developing your organization’s personalization strategy.  

Velir has experience creating personalization strategies and implementing personalization for clients. Learn more about our personalization capabilities or reach out to discuss your next personalization project.