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According to a McKinsey & Company report, companies that get marketing personalization right perform far better than those that don’t.

Faster-growing companies generate 40% more of their revenue from personalization than their slower-growing counterparts. “Across all US industries, moving to top-quartile performance in personalization would generate over $1 trillion in value,” McKinsey added.

The top 7 marketing personalization mistakes

According to marketing executives, there are 7 common marketing personalization mistakes brands are making today that are preventing them from maximizing the value of their personalization efforts.

1. Use of Incomplete Data

Personalization should involve a variety of data sources, ranging from zero to third-party data, said Jonathan Moran SAS Product Marketing Manager.

“Zero-party data (data collected voluntarily and directly from customers) should be combined with first-party (customer demographics) along with the less valuable second-party (customer data that is collected and then sold) and third-party (Data collected by an entity that has no direct relationship with the customer) sources.”

Zero and first-party data is the most valuable for personalization, and companies should leverage it as the foundation of their personalization strategies, Moran added. Organizations that primarily use second- and third-party data to perform personalization often face poor content personalization practices, low response rates from personalization efforts, and low overall value of personalization programs.

2. Failure to ensure data quality

“In order to effectively achieve personalized communications, increased demands are placed on data quality,” said Christian Wettre, SugarCRM senior vice president and general manager, Sugar Platform. “Personalization efforts are often not as effective as intended if marketers don’t trust the accuracy of the details in their databases. In the absence of that trust, personalization is often diluted by generalization of the message.”

To solve this problem, Wettre recommended treating the marketing and CRM databases as valuable assets and carefully examining, supplementing, weeding out and curating them. “Successful marketers will systematically validate and augment their data and try to include third-party intent data,” Wettre said. “When a marketing team trusts their data, they can unleash their creativity and craft more interesting and relevant messages.”

3. Failure to create customer profiles

To increase your effectiveness at receiving feedback correctly, you must profile your customers, said Jim Pendergast, senior vice president of SVP for altLINE, a division of The Southern Bank Company. “Find out who they are, what they like and how changes at your store are affecting the way they shop. You can usually track these types of changes using analytics software, which can be of great help in increasing your effectiveness. While you can’t help everyone in the same way, you can offer multiple options that work for people across your area.”

4. Using a partial view

Personalization can’t be done channel by channel, Moran said. “Nothing frustrates a consumer more than receiving a message on one channel (email) for an offer that has just been accepted (or declined) on another channel (call center, in-store, e-commerce, etc.).

To fix this, Moran recommended techniques like deterministic identity management and resolution to bring together customer data (all types) from all channels to get a holistic view of the customer.

5. Personalization defined too narrowly

Similarly, too many companies don’t consider everything that personalization should include, said Sarah Cascone, Bluecore’s vice president of marketing. “Businesses need to understand that personalization is more than just a name in a subject line; It’s the product recommendations, offers, and channel timing that create real curation. It starts with a valuable identification. Businesses often use identification to collect emails and phone numbers rather than collect the data about buyer preferences that allows them to reach consumers at a deeper level. Once this understanding is established, companies can move on to measuring the success of their personalization strategy.”

Cascone added that the best way to tell if a personalization strategy is working is to see if your first-time and repeat buyers are increasing. With personalized automated recommendations, retailers should see an increase in first-time purchases. After analyzing what motivated this first-time buyer to make a purchase, companies can further use this information to encourage repeat purchases.

6. Forget process optimization

Organizations that don’t incorporate optimization into their personalization practices do two things: They waste organizational resources (time, money, time spent developing content, etc.) and they frustrate their customers, Moran said. “A brand doesn’t need to communicate with an end consumer every day through email or sponsored social ads. Set optimization rules to communicate with consumers at appropriate time intervals when contextually relevant. Optimization rules that include the right contact policies and deal restrictions help brands get the most out of personalization programs.”

7. Not measuring the right things

Good personalization goes beyond conditional logic, Moran explained. Using if x, then y rules (e.g. if a customer visits a specific product page on my website, send them a retargeting email) is not the best strategy. Personalization must include analytics, where propensity, value, and customer lifetime value scores must be factored into personalization decisions across channels, devices, and points in time, among other analytical metrics.