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57+ Personalization Statistics (New 2022 Data)

by Josh Howarth
July 8, 2022

Personalization allows brands to create experiences tailored specifically to individual customers.

In many ways, personalization is a win-win situation for all parties. Shoppers are more likely to see messaging and products they actually want to see. Businesses get a higher return on their marketing budgets. And more.

However, many of today’s personalization techniques rely on cookies and third-party data. With concern around data privacy at an all-time high, the future of personalization is up in the air.

What is the state of personalization today, and what could the future hold?

Keep reading to find out.

Contents

Top Personalization Statistics

Before diving into the complete list of stats, take a look at 2022’s top personalization statistics:

  • 89% of marketers see a positive ROI when they use personalization in their campaigns
  • 60% of consumers say they’ll become repeat customers after a personalized shopping experience
  • 80% of consumers will share personal data in exchange for deals or offers
  • 74% of eCommerce companies have a website personalization program
  • The recommendation engine market size is projected to hit $12 billion by 2025
  • The global personalization software market is expected to hit $943 million in 2022
  • Up to 80% of marketers could abandon personalization efforts by 2025

Personalization Business Statistics

What does personalization look like from a business perspective? Here’s how companies are approaching personalization in 2022.

Companies that get personalization right have the potential to 40% more revenue than average (McKinsey)

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McKinsey’s Next in Personalization Report uncovered the dollar value behind the top personalization strategies. They concluded that collectively, US companies could generate $1 trillion in value if they ramped up their personalization efforts.

3 out of 4 business leaders believe that personalization is critical to success (Twilio Segment)

In the early days of the internet, personalization was something that helped give brands an edge over their competition. Today, personalization isn’t an option—it’s a requirement. 75% of business leaders now say personalization is “table stakes.”

43% of executives list personalization as a top reason for investing in hybrid experiences (Deloitte)

In the wake of the digital revolution, brands are embracing a new strategy—hybrid experiences. In a hybrid model, brands utilize digital and physical experiences throughout the customer journey. Online retailer Carvana has moved into the hybrid experience model by opening physical locations where customers can pick up cars they purchase online.

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Google searches for “carvana” over the past 5 years.

The recommendation engine market size is projected to hit $12 billion by 2025 (IndustryArc)

Recommendation engines are a key aspect of personalization—they analyze user data to create highly targeted product and service recommendations. The market was valued at just over $1 billion in 2018 and is primed for massive growth.

The global personalization software market is expected to hit $943 million this year (360i Research)

The personalization software market could grow by 23% from its $746 million 2021 value. The market is projected to reach $2.7 billion by 2027.

Personalized beauty startups raised over $1 billion in funding in 2021 (Statista)

2021 was the biggest year on record for personalized beauty. Startups in the space raised $1.04 billion, nearly 50% more than their previous high of $710 million in 2017. Companies like Hero Cosmetics offer personalized skin treatment products.

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Google searches for “hero cosmetics” over the past 5 years.

74% of ecommerce companies have a website personalization program (Yieldify)

Personalization allows ecommerce companies to create tailored experiences for their website visitors. But it doesn’t stop at web design. Over half of ecommerce companies are also personalizing their email marketing, mobile apps, display ads and instore/POS experiences.

Personalization Marketing Statistics

Personalization has become a critical component in marketing. Personalized marketing campaigns help brands deliver the right ads to the right audience.

89% of marketers see a positive ROI when they use personalization in their campaigns (Adobe)

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Only 11% of marketers say they earn less than a dollar for each dollar spent on personalization. At the other end of the spectrum, 9% of marketers say they see a $20 or more return on each dollar spent.

Improved customer experience is the top benefit of personalization according to marketers (Adobe)

64% of marketers consider customer experience to be one of personalization’s top benefits. That’s more than improved conversion rates (63%), increased engagement (53%) and increased lead generation (43%).

62% of marketers say content is the most used format for personalization (Adobe)

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Inline content (which includes web content and emails) is the most popular method of personalization for marketers. Other popular personalization formats are banner ads, call-out messages and popups.

Product recommendations and predictive customers service are the top two personalization uses in marketing (Statista)

Adobe reached out to 400 US and UK marketing professionals to learn the exact ways they use personalization in marketing. 46% mentioned product recommendations and predictive customer service. Over one-third mentioned email subject line (34%) and body (36%) personalization.

Acceptance of personalized ads has improved by 19% over the past two years (AMA)

In a survey of over 500 consumers, AMA New York found that the acceptance rate for personalized ads was 54% in 2021. That’s up from just 35% in 2019.

96% of advertising professionals in the music, movies and media sector use personalization in their marketing efforts (Statista)

Personalization in media is huge, with 96% of industry professionals using personalized marketing in the sector. Other industries with 90% of greater adoption rates are arts and crafts, gardening, footwear, outdoors, toys and apparel.

One-third of marketers spend 50% or more of their marketing budgets on personalization (Adobe)

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The amount of money poured into digital experience personalization varies across marketing departments. 18% of marketers spend 10% or less of their budgets on personalization, while just 1% spend 90% or more.

Marketers and consumers have different expectations of when data can be used for personalization without consent (AMA)

For personalized products and services, 47% of consumers and 63% of marketers think companies need consent to use their data. For personalized ads, 40% of consumers and 47% of marketers think data consent is necessary.

There’s a disconnect between businesses and consumer’s definitions of personalization (Twilio Segment)

85% of businesses say they’re delivering a personalized experience to their customers. But only 60% of consumers say they’re receiving a personalized experience.

Personalization Consumer Insights

From the consumer’s perspective, personalization is all about seeing relevant content, finding the right products and shopping with brands that understand their wants and needs.

87% of industry professionals say that customers expect at least some personalized content (LucidPress)

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Half of those professionals specify that the vast majority of their customers expect personalized content. Meeting those expectations is quite a challenge—only 32% of industry professionals say the majority of their content is personalized.

76% of consumers say they’re more likely to purchase from brands that personalize (McKinsey)

Personalization is key to the entire customer life cycle. In addition to personalization making consumers more likely to buy, 78% say they’re more likely to recommend brands that personalize as well as make repeat purchases.

66% of customers expect brands to understand their wants and needs (Salesforce)

Two-thirds of customers want to feel understood by the brands they interact with. But the same percentage of consumers (66%) say that brands “treat them like numbers”.

60% of consumers say they’ll become repeat customers after a personalized shopping experience (Twilio Segment)

That’s up from 47% in 2017—a 28% increase. On the flip side, close to half of consumers say they’re less likely to purchase from a brand after having an unpersonalized experience.

52% of consumers agree that personalization improves brand satisfaction (Twilio Segment)

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With eCommerce and DTC giving consumers infinite options, cultivating brand satisfaction is critical. 36% of consumers say they’ll keep shopping with a brand if they have a good experience. One way to deliver an outstanding experience is through personalization.

40% of consumers wish that brands knew more about their style preferences (Twilio Segment)

Personalization means different things to different people. In Twilio Segment’s personalization survey, consumers were asked “What do you wish brands knew more about you?” 40% mentioned style preferences, 24% mentioned household needs, 20% mentioned their economic situation, and 14% mentioned goals and dreams.

80% of consumers will share personal data in exchange for deals or offers (Sailthru)

While most consumers are concerned with data privacy, they’ll gladly trade some of that personal info for a discount. Loyalty programs are an effective way to trade first-party data for special offers. 53% of consumers belong to at least one loyalty program.

Personalization is consumers’ most appreciated element of interacting with luxury brands (BCG)

72% of luxury consumers have personalization at the top of their list of things they’d like to see when dealing with brands. Of those consumers, 39% say personalized treatment in-store is the most important aspect of shopping in person. 26% say targeted recommendations are the most important aspect of digital shopping.

Over one-third of shoppers want more personalization, but over half are concerned about data privacy (Retail Touch Points)

36% of shoppers wish brands would do more to offer personalized experiences. But their desire for data privacy makes personalization a challenge. 17% of consumers aren’t willing to share any personal data, while 52% are worried about companies knowing too much about them.

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Google searches for “data privacy” over the past 5 years.

First-time customers want personalization to make it easier for them to navigate stores (McKinsey)

Personalization isn’t just about recommendations. For first-time visitors, navigation is a huge part of satisfaction. It’s also a predictor of them becoming repeat buyers. 75% of consumers expect personalization to make navigation easier both in-store and online. On the other hand, only 40% enjoy seeing new brands show up in their frequently visited websites or apps.

The Future of Personalization

Data privacy has become a concern for consumers all over the globe. When companies can no longer use third-party data, how will they approach personalization?

Up to 80% of marketers could abandon personalization efforts by 2025 (Gartner)

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Cookies give access to valuable customer data that’s central to personalization. With Google phasing out third-party cookies on its Chrome browser by 2023, marketers are starting to see the writing on the wall. According to Gartner, 27% of marketers view customer data as personalization’s top challenge.

Two-thirds of North American and European eCommerce companies plan on investing more into personalization (Statista)

67% of eCommerce companies say they’ll invest more in the future compared to just 1% saying they’ll invest less. 26% plan on sticking to current personalization investments and 4% of companies don’t invest in personalization at all.

61% of high-growth companies are shifting toward first-party data for their personalization strategies (Deloitte)

With the death of third-party cookies just over the horizon, companies are looking for ways to pivot. 51% of high-growth companies are using first-party data to deliver personalized content.

Wrap Up

Personalization is a multi-billion-dollar industry that’s become widely accepted by businesses, marketers, and consumers alike.

It’s so ingrained in our digital lives that we often don’t realize it’s happening. Our social media feeds, inboxes and favorite online shopping sites are providing personalized experiences.

While questions surrounding data privacy make the future of personalization hard to predict, one thing is certain: customers want personalization. With billions of dollars at stake, brands are sure to find new ways to make personalization work in the future.