Most marketers have thought about personalizing to known users—people who’ve signed up, subscribed, or otherwise submitted their emails. It’s smart to give those users personal attention: that’s how you build loyalty. But what about everyone else?

According to research from VentureBeat, between 57% and 98% of your audience is likely anonymous.

 

 

So, if you’re just personalizing to your known users, you’re only optimizing your experience for a tiny slice of your audience. You’re missing out on the opportunity to engage the vast majority of your users—and perhaps more importantly, you’re not giving anonymous users a compelling reason to make themselves known.

Treating anonymous users like they’re all the same is standard, but treating them like future VIPs sets the foundation for long-lasting relationships. If you show your anonymous users that you understand them—and tailor their experiences accordingly—they’re likelier to engage, sign up, and ultimately join your cadre of power users. And trust us: you want to make your number of power users as big as possible.

The Power of Power Users

Have you heard of the 80/20 rule? Applied to sales, it stipulates that 80% of your revenue comes from 20% of your customers—your power users, so to speak. Examples from a few different industries:

  1. In mobile games, 0.23% of players generate 60% of all in-game revenues.
  2. In eCommerce, 40% of revenue comes from 8% of customers.
  3. According to Pew Research Center research on media companies, direct visitors (i.e. people who type in the URL) spend more time, view more pages, and visit more often than visitors from social media or search.

Focusing too much on user acquisition is a common mistake businesses make when trying to drive revenue. Many businesses put their weight behind getting more traffic, never taking the time to collect or understand data on individual users. This volume-based approach gets the job done, but it’s not efficient in the long run.

To illustrate the point, let’s walk through a hypothetical scenario with a website called FeedBuzz.com:

 

FeedBuzz

 

(Definitely not inspired by BuzzFeed. Not at all.)

Anyway — let’s say FeedBuzz had 100 visitors one month. 10% signed up, netting FeedBuzz 10 known users.

Now, let’s say FeedBuzz decided to focus on driving traffic and got 200 visitors the following month. 200 x 0.10 = 20 known users.

But let’s imagine an alternate scenario: along with upping traffic to 200 visitors, FeedBuzz tracked those new users’ data, using it to increase its conversion rate to 20%. 200 x 0.20 = 40 known users.

That’s 4x the amount it got the first month. And if FeedBuzz were to build on those relationships to create 40 new power users? The growth curve would look a bit more like this:

 

Screen Shot 2016-02-03 at 11.45.21 PM

 

Now that’s what we call engagement. By using data to engage users at every stage of the funnel, FeedBuzz made the most of its traffic.

Ultimately, identifying and tracking anonymous users is both an acquisition strategy and a retention strategy. Tracking and personalizing at every stage of a user’s journey gives you a holistic picture of them, one that’s crucial for building a long-lasting relationship. To insert a dating metaphor, it helps you catch their eye while they’re still anonymous, convince them to go out with you (i.e. give you their email address), and ultimately demonstrate that you really “get” them, and that spending lots of time with you is worth it. Wow them enough, and they might even introduce you to friends and family.

This post is partially excerpted from our eBook on turning anonymous users into power users. Click here to check it out!

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