Key takeaways
- Segmentation groups your mailing list into smaller sets of similar recipients so emails are more relevant and impactful.
- Relevant, segmented emails produce higher open and conversion rates compared with non-segmented sends.
- Start segmentation by collecting data (retail or website traffic, customer profiles, surveys, purchase history) and analyzing for patterns.
- Define segments by shared traits (location, age groups, interests, behaviours) and pinpoint each segment’s mindsets and preferences.
- Select the most valuable segments, then design tailored email content for each to maximize results.
- Segmentation offers economies of scale versus individual-level targeting, technology may enable individual targeting over time, but segmentation is currently more practical.
Introduction
As personalization becomes increasingly important to successful email marketing, segmentation is gaining ground as an important step for organizing a marketer’s mailing list.
Segmentation is essentially the process of dividing your customer base into smaller groups that are more similar to each other. It is used to focus in on a target audience in order to make an email more impactful for a specific reader or type of recipient. It is easier to send relevant emails with a higher value-exchange to readers who can be identified by similar interests and habits. This is an extremely important component of any successful email marketing campaign and its effectiveness has been proven by higher open and conversion rates.
What Makes Segmentation So Important?
People are inherently different and these differences need to be recognized when from a marketing perspective. However, it is not that plausible to create content and advertisements built individually for each person that a marketer would like to target.
“Though technology is beginning to offer ways to target the individual, a more effective strategy is to segment your customers and leads into smaller groups of similar people,” Chuck Cohn, contributor to Forbes Magazine. “This allows you to serve and properly message all those individuals who share behaviors, geographical location, lifestyles, etc. Segmentation can provide you with economies of scale, enabling you to best apply your marketing and R&D resources.”
This is why understanding a target audience is so important. At a basic level, this means knowing the general people that might be interested in your product or service. At a deeper level, segmentation is about breaking that group down into groups of people who share similar traits in order to provide them with content that is most relevant to them.
What Is The Best Way To Segment A Mailing List?
As stated above, there are many characteristics that can be used to segment a customer base. However, the list for a potential trait of segmentation is nearly endless and it takes careful consideration to determine the most effective method for grouping people.
“To identify your ideal segments, begin by collecting data. Your data may include an analysis of retail store or website traffic, as well as customer profiles, customer surveys, and purchase history,” recommends Cohn. “What patterns exist? You may uncover segments that you expected, or ones that you did not. Perhaps many of your most active customers live in or near metropolitan areas. Maybe your female leads can be divided into two age groups. Next, pinpoint each segment’s behaviors and beliefs, mindsets, and preferences.”
Once you have selected which segments offer the most valuable opportunities, then you can design and create content that is specifically tailored to their preferences. This creates a much more effective approach to email marketing and will help marketers get the most out of their mailing list. The results are undeniable and there is plenty of statistics that demonstrate the rise in conversion and open rates for email campaigns that have been segmented for the right audiences.
“Customer and lead segmentation that is grounded in data is the first step toward providing your current and future clients with an improved experience.” Says Cohn. “While it may not be possible to shape marketing messages on a wholly individual level, personalizing ads, emails, newsletters, and the like for smaller, segmented groups moves us closer to that ideal.”
FAQ
Segmentation is dividing your customer base into smaller groups of people who share similar traits so you can send more relevant emails. It matters because more relevant messages increase the value exchange with recipients and have been shown to raise open and conversion rates.
Collect and analyze data (retail or website traffic, customer profiles, customer surveys, purchase history). Look for patterns (e.g., concentration near metropolitan areas or distinct age splits) and then define segments by shared behaviours, beliefs, mindsets and preferences. Prioritize segments that offer the most valuable opportunities before creating content.
Gather data such as retail store or website traffic, customer profiles, customer surveys and purchase history. Use that data to spot patterns and group people by shared traits like location, age range, interests or buying behaviour.
After selecting valuable segments, design and create content specifically tailored to each segment’s preferences, mindsets and behaviours so messages are more relevant and impactful for those recipients.
Yes. Segmentation makes it easier to send relevant emails with a higher value exchange and that segmented campaigns have demonstrated higher open and conversion rates.
While technology is beginning to offer ways to target individuals, segmenting customers into smaller groups of similar people is currently a more effective and practical strategy for delivering personalized messaging at scale.
By grouping similar customers, you can serve and message all individuals in a segment with tailored content rather than creating unique content for each person, this lets you apply marketing and R&D resources more efficiently across groups.
