This article was co-authored with Mike Froggatt, Senior Director, Analyst, at Gartner.

Digital personalization is a double-edged sword. While it can significantly enhance customer experiences, it also risks alienating consumers if not executed thoughtfully. Digital marketing leaders must carefully manage the reality and perceptions around personalization.

A Gartner consumer survey of 2,001 respondents in April and May 2024 revealed that 63% acknowledge brands are good at guessing what they might be interested in buying, indicating progress in personalization efforts. The integration of generative AI technologies is poised to further refine these strategies by enabling more nuanced audience targeting and personalized customer journeys.

Encouragingly, 75% of consumers report more positive or neutral toward brands after receiving personalized recommendations online. This suggests that consumers have come to expect a degree of personalization in their digital interactions. But differences in attitudes exist. For example, more (47%) baby boomers felt negatively when they received an advertisement for a product after discussing or mentioning a product or brand online than younger generations. This highlights the need for marketers to tailor their strategies to different demographic groups.

The challenge of perceived intrusiveness

Although device manufacturers and media companies have long refuted the idea that devices and apps listen to consumers, consumers don’t necessarily believe this. As this chart shows, 81% say that after discussing a product offline, they either received an ad for the product online or a recommendation for the product on a retailer’s website.

In reality, consumers receive product recommendations and retargeted advertisements due to multiple factors, including interactions with smart speakers and purchase histories. This contributes to the perception that devices and apps monitor consumers’ offline audio conversations. This can erode consumer trust and underscores why digital marketers should cautiously approach delivering excessively personalized advertisements and recommendations. 

Using voice assistants for consumer profiling can also raise legitimate concerns about data privacy. Many consumers remain unaware of the specific data points used for ad targeting, underscoring the importance of transparency in data collection practices.

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To better align advertising strategies with consumer expectations, marketing leaders should consider the following recommendations:

• Enhance transparency: Communicate how and why consumer data is used in product recommendations and retargeted ads. Transparency builds trust and can differentiate your brand in a crowded marketplace.
• Adapt to privacy regulations: Stay ahead of evolving privacy regulations by assessing your organization’s data collection practices and readiness. Bridging the gap between marketing and advertising technology is crucial for seamless integration and compliance.
• Leverage first-party data: Expand the use of first-party data for targeting, reducing reliance on cookies and mitigating associated liabilities. Collaborate with key adtech and media partners to maximize the effectiveness of your campaigns.
• Investigate ad targeting technologies: Stay informed about how adtech companies use consumer signals to deliver personalized ads. This can help refine your targeting strategies and improve consumer experiences.

Safeguarding brand reputation

Nearly one-half of consumers (49%) develop a negative view of a brand when its ads appear next to offensive content. Despite investments in brand safety technologies, challenges persist in ensuring ads are placed in appropriate contexts.

Repetitive video and audio ads also frustrate consumers, with 47% expressing negative sentiments towards brands employing such tactics. Leveraging programmatic buying for connected TV (CTV) and digital audio advertising can help offset repetition by enabling better frequency capping and campaign optimization across multiple streaming platforms.

To maintain a positive brand image, consider these strategies:

• Utilize safe sites and allowlists: Start with known safe sites and collaborate with adtech partners to achieve audience scale. Employ allowlists and denylists judiciously to manage ad placements effectively.
• Engage with private marketplaces: Leverage private marketplaces (PMPs) and programmatic guaranteed (PG) inventory for more controlled ad placements. Use vetted buying partners and measurement and verification tools to ensure quality impressions.
• Contextual targeting: Partner with providers capable of targeting specific content types or blocking undesirable content. Ensure agreements include provisions for quality assurance.

Brand impersonation threats

Brand impersonation, including spoofing attacks, poses significant risks to consumer trust. 

Leaders must implement social media monitoring tools to detect and address brand impersonation and engage with communications and legal teams to formulate a robust response strategy. In addition, they must proactively share how customer data is used to improve ads and digital experiences to enhance organizational trustworthiness, credibility, and transparency.

Digital marketing leaders must strike a delicate balance between personalization and consumer trust. Organizations can foster lasting relationships with their audiences in an increasingly digital world by aligning advertising practices with consumer preferences and safeguarding brand reputation.