Study: Ad Personalization Offers a Key to Forming Stronger Personal Connections

As the world has continued to innovate, we have found that ad personalization is one of the more effective tools out there to help brands deliver more relevant ad experiences. In a new robust study by MAGNA and IPG Media Lab, “Pursuit of Relevance: All About Ad Personalization,” the effectiveness of personalized ads on brand KPIs was quantified and revealed brands can forge stronger connections with people through relevance in the form of personalized messaging. Ultimately, the same pre-roll video ad can drive +5% higher purchase intent with the use of more relevant, personalized messaging.

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The study found that most forms of ad personalization had value, but generally higher levels of personalization were often needed to shift more difficult-to-move metrics. For example, personalizing ads based on major life events struck an emotional chord with people, leaving them interested in hearing more from the brand (+16%) and more likely to purchase the brand (+12%) compared to the same video ad without a personalized message. Similarly, personalizing ads based on search terms, which are also deemed more sensitive than other forms of data such as age, drove brand preference (+8%).

The scope of the research included responses from over 6,600 participants and spanned three industry verticals (auto, retailer, and finance). Testing was conducted among two audience types – each brand’s demographic target and High-Value Audiences (HVAs), which are based on people-based IDs for brand-identified targeting personas created by Kinesso. Ultimately, six types of data sources for personalization were tested: demos, past purchases, location, life events, search terms, and persona-based messages (HVAs only).

“This is an important study that reinforces our belief that personalized messaging, when coupled with precision targeting is a key to driving the results that brands demand today of their advertising,” said Brendan Gaul, Global Chief Content Officer, Head of UM Studios. It also uncovers the importance of maintaining best practices and creative excellence in the development of the work. A good ad that is personalized works very hard. A bad ad that is personalized is still a bad ad.”

“Relevance is a critical part of brand marketing strategy because people today are inundated with content on a daily basis and it can be overwhelming,” said Kara Manatt, SVP, Group Director, Intelligence Solutions at MAGNA Global. “Personalized messaging can not only help create more relevant ads but also help amplify brand stories, forging stronger more solid personal connections.”

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Additional key findings the study found on the effectiveness of personalized messaging include:

• Personalization doesn’t guarantee branding. Performance of personalized ads is amplified when branding is incorporated into the messaging. With branding in the message, personalized ads are +8% more memorable than standards ads. Creative best practices still apply, so the process of planning for personalization shouldn’t distract from the need to have strong branding.

• Higher levels of personalization may be needed for more difficult-to-shift metrics. Personalizing ads based on life events and search terms were more likely to shift metrics such as brand preference and purchase intent. People were particularly open to the information in ads that were personalized based on their search terms and drove preference for the advertised brand over competitors (+8%). Ads personalized based on life events struck an emotional chord and drove intent to purchase (+12%).
• Couple personalization with precision targeting. Using people-based IDs for targeting HVAs is effective, but these audiences are often critical of mass-market messaging. In response to personalized ads, however, HVAs are much more open (+5%, “something I’m open to right now”). Brands should also consider crafting persona-based messaging for even greater impact (+20% on brand preference vs. +8% with standard personalization).

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