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Personality Matters: How one company doubled its ROI by customizing ads based on personality

August 31st, 2015 No comments

Today’s algorithms can reliably predict people’s personality traits just by analyzing their Facebook updates.

As marketers, we have the ability to use the digital footprint data of our customers to assess their personality, create messages that resonate with them personally and build more effective campaigns.

To see if this really works, let’s look at return on investment (ROI) results from a recent test of customized ads based on personality traits.

Sandra Matz and her fellow researchers from the Psychometrics Centre, University of Cambridge, collaborated with VisualDNA, an agency helping companies leverage psychographic audience data to better personalize their messaging. Together, they worked with an online beauty retailer to conduct an experiment on Facebook, and presented their results at the 2015 Annual Convention of the Society for Personality and Social Psychology (SPSP).

The researchers hypothesized that presenting customers with ads that fit their personality traits (extraversion or introversion) would result in higher ROI for the campaign

 

The test

To test their hypothesis, they created two sets of ads, one customized towards extraverts and the other tailored towards introverts. Although other personality traits could be relevant, the researchers picked extraversion/introversion for the test, because it was most conducive to creating contrasting ads.

Researchers described the typical extravert/introvert to designers, and the designers came up with corresponding ads.

 

Next they selected two groups of Facebook users — one consisting of more extraverted people and the other one consisting of more introverted people.

They then showed the two ads to both user segments, such that both groups saw both congruent (e.g., introvert customer/introvert ad) and incongruent (e.g., introvert customer/extravert ad) ads.

 

Results

Overall, the seven day campaign generated 6.43 million impressions, 390 conversions and 12,830 pounds ($20,000 USD) in revenue for an ad spend of 4,000 pounds ($6,300 USD).

Customizing ads to personality traits significantly improved ROI for both target groups.

Showing introverts an introverted ad was twice as profitable as showing them an extraverted ad. Showing extroverts an extraverted ad resulted in 30% higher ROI than showing them an introverted ad.

 

Takeaways

To sum up, personality can be a useful tool for better understanding your customers, creating marketing messages that will resonate more with them and increasing ROI for your campaign.

Although personality is a reliable predictor of behavior in situations when people have a fair degree of choice, different contextual factors (e.g., industry, complexity of the decision, social influence) can change the strength or even direction of this relationship.

Remember to study your customers’ personality-behavior relationship specifically; find out what personality traits your existing and potential customers have in common.

You can assess your customers’ personality internally, if you have enough dedicated resources, or you can outsource this task to a vendor. According to Vesselin Popov, Development Strategist, The Psychometrics Centre, University of Cambridge, one advantage of outsourcing personality prediction is that you can anonymize the data.

You don’t need to know your customers’ personal identity to learn what kind of messaging they would prefer.

Now, what is your dominant personality trait?

 

You might also like

Lead Nurturing: Market to personality and behavior, not job title (from the B2B Lead Roundtable blog)

Discover your personality with a 120-item personality test (from University of Pennsylvania)

1-click prediction of 34 psycho-demographic traits (prediction API of the Psychometrics Centre, University of Cambridge)

Penn Researchers Use Facebook Data to Predict Users’ Age, Gender and Personality Traits (from the University of Pennsylvania)

IBM researcher can decipher your personality from looking at 200 of your tweets (by Dean Takahashi, VentureBeat)

Using The Big Five For Customised Advertising On Facebook by Matz, S.,  Popov, V., Kosinski, M., Stillwell, D., presented at the Annual Meeting of the Society for Personality and Social Psychology (SPSP), 2015.

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A/B Split Testing: How to use the right test progression to get customer discoveries and results

August 17th, 2015 2 comments

Throughout the year, I talk to a lot of people who do A/B and multivariate testing to increase conversion rates. Even in very large companies with well-known brands, it’s not uncommon to hear stories of many tests without a lot of lifts. 

Often, when they first started testing, there were easy wins. Now, not so much. These companies have all the tools necessary to test but lack one or more key ingredients necessary for sustained success.  In this blog post, I will share one of those key ingredients: testing progression.

 

What to do after you’ve plucked the low-hanging fruit

Getting great results is not easy to sustain. There are many factors that go into successful test strategies, starting with having a product or service with a compelling value proposition. All the strategy and tactics in the world will not prop up mediocre products and services.

If you do have a great product or service, the right approach to conversion rate optimization will help you realize the full potential of your solutions, especially after you have capitalized on the “low-hanging fruit” leadership is forever hungry for.

The best testing strategies are not a collection of random, disconnected tests. They are also not the product of blindly copying what your competitors do. 

Rather, tests build on each other, ideally in a series of logical if-then statements.

For example, the below flowchart shows a series of “if-then” statements that can be filled in based on the cost per acquisition (CPA) test results. 

  Read more…

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Bet on Horses, Not Customer Assumptions: How the Kentucky Derby tested content for relevance with customers

July 23rd, 2015 1 comment

Assumptions can be a dangerous territory — especially when it comes to being relevant with your customers.

When a brand has a large gap between purchases, keeping customers engaged becomes a consistent concern.

The team at the Kentucky Derby faced that issue when they decided to use the weekly newsletter to identify and validate customer segments.

“When we look to grow a brand like the Kentucky Derby, that breadth of engagement is really core to our growth path,” Jeff Koleba, Vice President of Marketing and Programming, Kentucky Derby, said in this session from MarketingSherpa Email Summit 2015.

To solve this issue, Jeff and Kate Ellis, Marketing Analyst, Kentucky Derby, decided to begin segmenting and directing content directly towards the customers who wanted it most. Within its established customer personas, the Derby focused testing on three segments:

  • Social content interests
  • Equine enthusiasts
  • Betting/wagering information

Once they set up segmentation and supported it with relevant content, the team began optimizing for maximum engagement.

Read more…

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Website Optimization: How to reduce friction in purchase and registration processes

July 20th, 2015 2 comments

Sometimes getting consumers to the landing page is the easy part.

The ingrained friction the buying, and even registration, processes create for users can cause them to hesitate in completing the process. After all, you don’t visit a site to register; you come to consume whatever information they have to offer. The registration part gets in the way.

When the registration process seems unusually long, you give up and leave the site. The value beyond the registration no longer outweighs the time and effort needed to get to it.

The same goes for purchases. When we create additional friction through design, copy and overall experience, it can push a customer to abandon their cart instead of pushing through the mental resistance certain elements create in their mind.

The good news is that we can indeed reduce the friction present in the conversion process. We can do that in two ways: length and difficulty.

For length-oriented friction, look at:

  • the length of your process as a whole
  • the layout of fields
  • the number of fields

For difficulty-oriented friction, examine:

  • the format of your pages
  • the number of options provided and how they’re displayed
  • the button design and placement

Sometimes it can be hard to look at a page and immediately pinpoint these things, so we’ve designed a checklist of sorts for you to go through while analyzing your processes.

We’ve also included some “Not this, but this” examples to show you possible alternatives. Remember, what might work with one audience doesn’t always work with another. That means you’ll want to test your changes to make sure you’ve found the best process for your customers.

Read more…

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Holidays Ahead: Market with caution

July 16th, 2015 No comments

Every holiday presents both opportunity and danger: you can either engage audiences or you can alienate them. It just depends on if you choose to jump on the seasonal bandwagon and how effectively you make the leap.

The most recent Marketing Experiments Web clinic examines holiday marketing lessons learned, and what you need to do to ensure you take full advantage of seasonal campaigns while dodging pitfalls.  Watch it here.

Consider this test, which has been anonymized.

Background: A large financial institution.

Goal: To convince customers to take out a mortgage or refinance an existing one.

Research question: Which email treatment will generate the highest clickthrough?

Test: A/B sequential test

 

The Straightforward Control

The Control was an email that focuses on low mortgage rates and how to take advantage of them.

  Read more…

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Why Selfishness Is the Key to Successful Marketing

July 9th, 2015 No comments

Philosophers [must] become kings … or those now called kings [must] … genuinely and adequately philosophize.” —Plato

Flint McGlaughlin, Managing Director and CEO, MECLABS Institute, remarked about Plato’s quote in The Marketer as Philosopher — “One might substitute the term ‘marketer’ for the term ‘king.’”

In order to best communicate as marketers, we need to sometimes slow down and ask “why” we are doing the “what.” This includes considering the reasons for the various elements of brand collateral, images, calls-to-action and testimonials we insert onto our pages.

I recently came across a test that highlighted for me some of these challenges that marketers often face when balancing the “why” and the “what.”

That’s why in this post I want to show how we can use the MECLABS Conversion Heuristic to really drill down on these specific elements while giving you a process in which you can apply a methodology to creating and optimizing all of your marketing collateral.

 

MECLABS Conversion Heuristic

 

This heuristic is just that — a heuristic. This means it is simply a mental shorthand used to convey an idea or approach. This is not a mathematical equation and you cannot solve it. However, it does work similarly to an equation in the idea that the coefficient preceding the letters indicates that value’s level of importance.

Therefore, motivation, with a coefficient of four, is more important in the conversion than anxiety, which only has a coefficient of two.

With that being said, let’s start by evaluating the customer’s motivation on a page and how each element can cater to that motivation.

Read more…

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