Most 'personalized" ads aren't so personal

Retailers and websites are failing to use the best data at their fingertips to target ads and offers to consumers, according to one company.

Eighty percent of profits come from 20 percent of customers, and companies should focus on the data that those customers provide, including their preferences, location, age and web habits, according to analytics company CrowdTwist.

While a wealth of data comes from sites like Facebook, Twitter and Pinterest, some companies could be paying too much attention to social media, said Irving Fain, CrowdTwist's CEO.

"I think the reality is that social media isn't and can't be looked at as the end-all, be-all. It is one channel out of many channels where you interact with consumers," Fain said.

And word of mouth is vital to marketing efforts, according to the company. About 50 percent of social media users under age 35 follow their online friends' product and service recommendations, Fain said.

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