How personalized advertising influences consumer behavior

by Julia Pott

According to a recent study by the digital association Bitkom, personalized advertising has a direct influence on the purchasing behavior of consumers in Germany. More than half (54%) of those surveyed have already bought a product online after seeing a personalized advertisement. As many as 44% stated that they had visited a local store as a result of such an advertisement. Consumers are particularly likely to encounter personalized advertising on social networks (54%), in online stores (51%) and on search engines (45%).

Personalized advertising is perceived as helpful in many cases – particularly for everyday products such as food (36%), clothing (35%) and entertainment (33%). However, high-priced or individual offers such as real estate (21%) or financial services (20%) are less likely to be perceived as useful.

Personalized advertising is particularly important for smaller companies and those in niche markets in order to remain competitive: Over 60 percent of respondents believe that these companies would not be able to reach their specific target groups as effectively and cost-efficiently without personalized ads.

The influence of personalized advertising on consumer behavior has also been well researched internationally. Studies – summarized in 2024 in the research paper “Influence of Personalized Advertising on Consumer Engagement and Conversion Rates” and published in the International Journal of Research in Engineering and Management – highlight that personalized advertising significantly increases consumer engagement and conversion rates.

Consumer engagement is the interaction between consumers and a brand, for example through website visits, social media activities or the sharing of content. Personalized advertising promotes this engagement by targeting individual preferences and needs. Personalized calls to action perform twice as well as generic variants. In addition, an analysis showed that 91% of consumers are more likely to shop with brands that make offers tailored to their needs.

Another decisive factor is the effect of personalized advertising on conversion rates, i.e. the proportion of customers who carry out a desired action after an advertising interaction - such as making a purchase. Here, personalized email campaigns generate six times higher transaction rates than non-personalized advertising emails.

A key driver of personalization is the use of artificial intelligence and machine learning. According to Bitkom, AI is increasingly being used to create and optimize advertising campaigns. From automated tests and budget adjustments to precise target group analyses, AI enables a hyper-personalized advertising approach. Bitkom CEO Dr. Bernhard Rohleder describes this as the “next level of digital marketing”, in which real-time data and behavioral analyses are used to deliver even more targeted advertising. AI enables predictive, i.e. forward-looking, analyses of purchasing behavior or ad performance. Algorithms use this data to predict future consumer behavior or the success of advertising campaigns. This allows marketing strategies to be optimized in an even more targeted manner. AI also supports the creative side of digital marketing. Language models help to create marketing texts, product information, advertising slogans or CTAs. Images, videos and music can also be created or edited with the help of AI tools.

The international research paper also emphasizes the growing importance of AI for personalized advertising. By using machine learning, companies can optimize their advertising content in real time and thus significantly increase the relevance and efficiency of their campaigns. The dynamic adaptation of advertising messages based on current user behavior ensures that consumers receive precisely the offers that match their current purchasing interests.

Personalized advertising not only influences general consumer engagement, brand perception and customer loyalty, but also has a positive impact on purchasing behaviour and conversion rates. The use of AI and machine learning is driving this development forward and enables an even more precise approach to consumers with fewer resources. For companies, this represents an opportunity to make their marketing strategies more efficient and strengthen long-term customer loyalty. In light of these developments, personalized advertising and the use of AI remain indispensable tools in digital marketing.

However, this development also poses a challenge for retail companies, namely finding or training the appropriate specialist staff. The Bitkom study shows that the qualification profiles of marketing departments are changing accordingly: AI skills are increasingly in demand, with keywords such as “ChatGPT” or “prompt” appearing more frequently in job advertisements. AI will not replace human expertise in the foreseeable future, but it will complement it and make marketing processes more efficient.

Sources: Bitkom press release (German), Research Paper „Influence of Personalized Advertising on Consumer Engagement and Conversion Rates”