Let’s face it: marketing is filled with mumbo-jumbo. Projections this, regression analysis that. All of these larger than life terms and little substance. We get it - we’ve been there too - what does all of this mean? Is there really anything to it? Well, yes. Sometimes.

Segmentation - to divide a whole into parts, which are definable, actionable, and profitable and have potential.

THEECONOMICTIMES.COM.

Are you lookin' for ideas on how to segment your audience the right way? This article is specially written for you! Today we'll be talking about one fundamental term that really, truly matters in any marketing effort, but is especially important and customizable in email. Enter segmentation. 

In the past, marketers would typically send batches of emails to their subscribers and get stunning results. Now, the focus is on high quality. So, it doesn't matter that much how many subscribers you have, or how many emails you send; you're not gonna get results you dream of if you don't segment your emails. Wait...what? Email segmentation? Oh yep, that's exaaaactly what replaced the batch and blast technique that used to work a couple of years ago.

By BronHiggs - Own work, CC BY-SA 4.0 By BronHiggs - Own work, CC BY-SA 4.0

Ergh?! What is 'segmentation' again?

Segmentation, as Dictionary.com puts it, is the "division of segments." Well, that didn't help - what really is list segmentation, and how does it apply to my business? 

Segmentation, like the name suggests, is the method of splitting subscribers into smaller groups based on their job title, age group, status location, and similar, to personalize your wonderfully crafted emails to individual subscribers. Let me explain this with a little analogy:

That being said, suppose your audience spans the entire continental United States. Let's also suppose that your business line is comprised of over 100 snacks with everything ranging from savory cheese puffs to spicy nuts to sweet chocolate candies. With audience segmentation, you can make sure that you're reaching out to people who are most interested in a particular product rather than shooting a message off to everyone, hoping to catch a percentage of the total. This isn't advised.

The good news - they have (at least one) email address!

Bad news - there are way too many things they don't teach us at school, and email marketing is one of them. That is why our email marketing agency is here to help and dive into whys and hows of segmentation.

Okay, I get it - but why use it?

With proper segmentation, we can:

  • Provide interested customers information and promotions on what they are interested in, and not what they aren't. If you're lactose-intolerant, would you be excited to try our new milk product? No, and neither would your customer. If you're the type of flavoring your Sriracha with food (see what I did there?), then you won't just open that email focusing on the new Ultra Spicy Nut Mix, you'll spend your entire paycheck on it.
  • Keep deliverability up! While not as exciting as the prospect of having a customer who spends their entire paycheck on your latest offering, on a grander scale, some might say this is just as, if not more important than a mega-happy customer. Deliverability put simply, is your ability to reach your audience. With improper segmentation comes not just little customer engagement, but the dreaded Spam folder. The more that you give your customers what they're interested in, the more of your contacts you can successfully connect with via your email program.
  • Learn what your customers are interested in! One of the most important aspects of a good marketing program is learning what your customers like. Marketing is equal parts promoting your products and getting to know them better. As you begin testing with segmentation, you start to see trends emerge. Where trends emerge, we begin to see customer personas, and where we see customer personas, we see the potential for new products, lines, and ways of getting them what they want before they even know they want it. Proper segmentation can not only improve the customer experience but can give a real, in-depth insight into the direction your business can move and grow.
  • Learn your customers' favorite way of being contacted. We're all so different in our day to day lives, and - you got it - we interact differently with the brands we frequent too. While somebody would appreciate being emailed, the next guy might feel overwhelmed by that. Whether it be SMS, email, or in-app notifications, we each have our own preference of learning about what a brand has to say, so why not give your customers what they need?
  • Reduce your bounce and unsubscribe rates! - since email segmentation enables you to identify folks from your list that are opening your emails as well as those that aren't. Those inactive ones that are no longer interested in your messages can increase your bounce rates. Segmentation allows you to identify them so you can follow-up with them to get them back once more.

Although this is just the tip of the iceberg, segmentation can go much, muuuuch deeper. In the world of email, we're fortunate in that we have the ability to track (and learn from) key KPIs in real-time on just about anything we're interested in knowing or segmenting off of. Do you care what device your customers use most frequently? No problem. Do customers who spend between $166-204 per year make up your most crucial customer-base for a particular product line that you want to upsell them on? Easy. Interested in only promoting your hot snacks to people living in the northern states during winter? Piece of (hot) cake.

With proper segmentation, we gain the ability to personalize messages to customer lists that are most likely to be interested in and thus purchase any particular item. We have the ability to segment off of just about anything - as long as you can think of splitting up a group of customers in a certain way, you'll more likely than not be able to.

Oh really? Tell me more!

A few years ago, segmentation was known as a complex technique that only email marketing experts could take advantage of. Nowadays, thanks to the tons of information and available tools, anyone can learn how to personalize emails to specific lists.

Q: But wait, when is the best time to begin with email segmentation? 

A: ASAP. 

When someone signs up for your mailing list, they have some specific reasons. Whether that would be to learn more about what you do, to stay updated with the latest and most relevant happenings, get freebies, and offer and so on. If you're not from Hogwarts it won't be easy to realize why one subscribed to your email list....unless...unless you segment your subscribers based on where they sign up from or their behavior.

Before you begin, it's important to set your segmentation goals. You can start by answering some of the following questions:

  • Who is your target audience?
  • What are they looking for?
  • How many of them are first-time or frequent buyers?
  • How often do they engage with your emails?
  • Are they a repeat customer? 
  • Have they purchased one, or more of your product lines? 
  • How often does he visit your site?

Types of Market Segmentation that that will help you reach your ideal customer

You want to understand how your market will respond in a certain situation, such as a new product launch for example? In most cases, a predictive model can be incorporated into the study so that folks can be grouped within identified segments based on specific answers to the survey questions.

  • Demographic Segmentation - This one sorts a market by demographic elements like gender, age, education, occupation, income, family size, nationality, and so on. It's one of the most commonly used forms of segmentation because the products we buy and services we use, how we use them, and how much dollars we are willing to spend is generally based on these factors.
  • Geographic Segmentation - While generally a subset of demographics, the geographic one is typically the easiest. It creates various target groups based on geographical boundaries. Your potential customers have interests, preferences, and needs, and that differ according to their geographies. By understanding the geographic regions and climates of specific customer groups, you will be able to determine where to advertise, as well as where to expand your business.
  • Behavioral Segmentation - Behavioral segmentation divides markets by decision-making patterns like lifestyle, purchase, and usage. As an example, younger buyers tend to purchase a bubbly body wash, while older consumer groups more often lean towards soap bars. Segmenting your list based on purchase behaviors will enable you to develop a more targeted approach.
  • Psychographic Segmentation - Last but not least - psychographic segmentation. This one takes into account the psychological aspects of consumer behavior by dividing markets according to values, opinions, personality traits, and interests of consumers. Some huge markets, such as the fitness market are using psychographic segmentation while sorting their customers into categories of the ones who care about healthy living and exercise, and the ones who don't.

Just listen to us and do it!

In the end, your creativity is the limit on how you can group your customers. Remember, anything is possible in the world of email, and segmentation is a powerful tool that not just keeps your customers happy hearing from you, but is a strong revenue driver and intel tool to boot.