How to Stop Wasting Money on Personalization: A Strategic Approach to Cost-Effective Marketing
Investment in marketing technology (martech) to enhance personalization is at the heart of many customer experience (CX) and digital transformation initiatives. However, the cost of personalization can quickly spiral, leading many businesses to question whether their investments truly yield a beneficial return.
Understanding the Financial Landscape
According to Gartner’s 2025 CMO Spend Survey, CMOs focusing on personalization allocate 25.4% of their budgets to marketing technology. Comparatively, those who prioritize other initiatives only allocate 21.8%. Yet, a staggering 70% of marketers confess that gauging the ROI of their marketing campaigns poses a significant challenge.
While journey orchestration can exponentially enhance the value of personalization—growing with every customer interaction—marketers often overlook the substantial costs involved. To tackle the cost-to-value dilemma, journey orchestration must evolve from an art into a highly systematic discipline.
Understanding Unit Costs for Optimization
The rising costs associated with personalization are often attributed to the manual crafting of campaigns, which inhibits growth. For instance, marketer activity is projected to rise by an average of 30% in campaigns in 2024, compared to 2023. This trend could lead to managing tenfold more campaigns by 2034, resulting in alarmingly higher labor and technology costs. These hidden risks can jeopardize your journey orchestration ambitions.
However, a transformative solution lies in treating journey orchestration as a streamlined production line. What does it truly cost to send a personalized email? Many organizations fail to capture the complete financial picture of their email marketing efforts, often stopping short at vendor contracts. Activity-based costing—analyzing every component of your multichannel marketing campaign—is essential for understanding total expenditure.
Calculate Your Costs
To effectively gauge the cost of a personalized campaign, analyze each participating platform. Gather detailed information on fees associated with contracts and pay-as-you-go models. Establishing unit costs for activities empowers you to forecast monthly expenses while adjusting for seasonal fluctuations.
Mapping Your Process to Multichannel Marketing
To scale your campaign operations effectively, map your processes to the seven stages of multichannel marketing, ensuring each step outputs seamlessly into the next.
Develop Strategy: Transform customer insights into a targeted plan.
Output: Campaign briefs.Create Customer Segments: Implement targeting strategies utilizing customer data.
Output: Defined audience segments.Configure Channels and Journeys: Establish coherent flows across channels defined by your chosen content and timing.
Output: Channel and journey steps.Align/Create Content: Select or build assets that resonate with the defined journey.
Output: Created or selected assets.Review and Approve: Ensure brand compliance through testing and previews.
Output: Approved campaign assets.Execute: Activate the campaign across selected platforms.
Output: Campaign delivery.- Reporting and Analytics: Collect and synthesize data into actionable insights.
Output: Comprehensive dashboards and reports.
By focusing on both vendor costs and the time spent activating campaigns, you can better assess the actual expense of each delivery unit.
Mastering Cost Management
Don’t be intimidated by the complexities of cost management. Begin with a small scope, make informed assumptions, and work toward an initial version.
For example, research from Gartner indicates that a simple individual channel campaign targeting 1.4 million customers incurs a unit cost of approximately $6,240. In stark contrast, a more intricate multichannel campaign may escalate to over $56,464.
With this kind of financial insight, it’s prudent for leaders to scrutinize the overall effectiveness of different campaigns and to continually adjust strategies.
Addressing Inefficiencies
Labor costs are the primary culprits behind skyrocketing orchestration expenses. Create a roadmap that emphasizes team upskilling, utilizes generative AI to streamline workflows, and promotes efficiency at every production stage. Regularly audit and update your marketing tech framework to assess and enhance the value of journey orchestration.
Brace for Impact: Navigating Pricing Shifts
A recent Gartner survey highlights that 34% of marketing teams face unexpected fees not covered in their agreements. As budgets shrink, unanticipated costs can become detrimental.
With the rising trend of consumption-based pricing models, where costs shift from base licenses to activity-based charges, marketers must engage proactively. These pricing models can significantly reduce baseline costs but can escalate expenditures relating to campaign activities, such as running predictions or issuing AI prompts.
Successfully Managing Costs
Understanding the intricacies of unit costs enables you to navigate new pricing models effectively. Monitor expenses across your tech stack, adapt to consumption models, and fortify your capabilities against the rising risks that can impact your return on investment.
By mastering your unit economics, you can avoid the pitfalls of inefficiency that often plague multichannel marketing efforts.
Benjamin Bloom is a VP analyst in the Gartner Marketing Practice, specializing in martech stack optimization, personalization, and customer data management. He shared insights on this subject at the Gartner Marketing Symposium/Xpo, held from June 2-4, 2025, in Denver, CO.
For more information, explore these resources:
- Half of Ecommerce Brands Lack the Support to Scale Personalization Effectively
- Your 4-Step Guide to Local Marketing Success
By engaging with this strategic approach, marketers can significantly enhance their personalization efforts without breaking the bank.
