Personalization increases purchase frequency and reduces price sensitivity

To tailor an offer to the consumer, the retailer needs to know what is currently on the consumer's wish list. How is personalization perceived by consumers? Ingenico Marketing Solutions conducted a consumer survey in Germany.

  • Just under 32 percent can imagine that personalized offer advertising will lead to more purchase frequency for them
  • 46.2 percent of respondents say that notices about new products and special offers generate the most interest
  • 14.9 percent of respondents want to pay less attention to price in individual offers

Personalized offers increase purchase frequency by up to 55 percent

Just under 32 percent of respondents can imagine that personalized offer advertising would lead to more frequent purchases. Among respondents who would like to see advertising tailored explicitly to them, this figure is 46.4 percent. If we now narrow it down once again to the group that is open to advertising, the willingness to increase purchase frequency even rises to 55 percent. And only 15.5 percent of respondents generally rule out this behavior.

News and special offers instead of offers on already purchased items

When asked whether consumers place more value on being reminded of everyday products they have already purchased or on news about special offers, the results are clear: The majority say that notices about new products and special offers (46.2 percent) or a mix of these with information about products already purchased in the past (42.7 percent) generate the greatest interest. Only a few consumers are interested in receiving advertising exclusively about items they have already purchased (12 percent).

For a quarter of respondents, a suitable offer is more important than price

Another result of the survey shows that personalized offers have been proven to reduce customers' price sensitivity. On average, 14.9 percent of respondents said they would pay less attention to the price of personalized offers. In the target group that is open to advertising, 25.8 percent already put the offer before the price. And almost 31 percent of the 30 to 39-year-olds who are open to advertising pay less attention to the price.

"The survey clearly shows that consumers are willing to change their consumption behavior," summarizes Jochen Freese, Managing Director of Ingenico Marketing Solutions. "On the one hand, they would visit retailers with personalization competencies more often, which leads to additional sales. For another, retailers might even forgo discounts and thus margin reductions, which increases revenue. However, this does not work for retailers who understand personalization to mean merely addressing consumers by name," says Freese. "We mean an offer tailored to the consumer that relates his or her buying and search habits to those of all other customers and that, above all, is used at all consumer touchpoints for a more relevant and thus more successful dialog."

Ingenico Marketing Solutions is a pan-European provider of customer loyalty concepts. For the survey "Personalization in Omnichannel Commerce through Recommender Systems", a total of 1051 private individuals aged 18 and over from Germany were surveyed online from December 13 to 20, 2018. The white paper with the study can be here be obtained.

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