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Personalized Ads Can Boost Purchase Intent

(Image credit: Magna)

Personalized ads can forge stronger connections with consumers and ultimately boost purchase intent, a new study from media buyer Magna and IPG Media Lab.

The study, Pursuit of Relevance: All About Ad Personalization, found that most forms of ad personalization had value, but moving some metrics took more work. 

Personalizing ads based on major life events struck an emotional chord with people, leaving them 16% more interested in hearing more from the brand and 12% more likely to purchase the brand, compared to the same video ad without a personalized message.

Testing was conducted among brands’ demographic target and with high-value audiences, based on people-based ID created by Kinesso. Six data sources were tested for personalization: demos, past purchases, location, life events, search terms and persona-based messages (only used on the high-value audiences).

“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, an IPG media agency. “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.”

The study was conducted with 6,600 participants and looked at three advertiser categories, auto, retail and finance. 

“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, senior VP, 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.”

The study also found that 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, according to the study.

Advertisers should couple personalization with precision targeting, the report said. 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, with 5% saying its something they’re open to right now.

Brands should also consider crafting persona-based messaging for even greater impact. The report found a 20% stronger response to ads personalized based on brand preference compared to 8% using standard personalization.