In recent years personalisation in Marketing has become increasingly important. In our blog here we looked at how to make marketing more focused by creating Audience Personas.

In this article, we look more closely at email marketing.  In particular, how to use segmentation to group together similar people in your target audiences and then personalise emails to them.

Done well, this can help increase open rates, aid engagement, and ultimately lead to potential buyers purchasing from you.

Why is segmentation important?

Figures show that personalised emails deliver six times higher transaction rates, and 82% of marketers have reported an increase in open rates when the email content is personalised.

Most businesses know that sharing email content that is targeted and relevant is far better than a blanket email to all. Often the thought of having to portion up their database seems too daunting a task.

Campaign Monitor recently examined behaviours around email open rates and engagement rates.  The research found that customised, personalised, and relevant email messaging can increase revenue by 760%.  Other research shows that 56% of people unsubscribe from emails due to content that’s not relevant to them (Chadwick Martin Bailey).

So, for loyalty and continued engagement from your email marketing recipients, relevance and personalisation is key. And to be able to create those personalised messages, you’ll need to segment your target audience or general marketing ‘list’.

How to segment successfully

Every business will have different criteria and business models that mean how and what they segment will vary.

At a basic level you may choose to segment your audience by age, location, whether they have previously purchased from you previously (or not) yet. In addition, what type of content might interest different target groups, shared interests and needs, as well as how they signed up initially can also influence how you segment the audience.

Most CRM software and email marketing platforms will allow you to do slightly different things (some are more detailed and complicated than others).  The majority, however, will allow you to segment in some way.  This is typically done by assigning specific characteristics, attributes or tags to customer/prospect records.

These are then searched individually or in different combinations to produce a more focused customer group, or segment.  With the segment in mind, targeted messaging, imagery and other creative treatments are applied to generate an email campaign that is highly relevant to them.

4 Common segmentation approaches

To avoid over-complicating the segmentation process initially, there are 4 common approaches that businesses use:

Demographic segmentation

Demographics tend to include factors such as age, gender, job role, industry sector etc. These are often used as the first step in starting to segment a target list for email marketing.

Psychographic segmentation

Psychographic segmentation creates distinct customer groups by considering the influences on their buying behaviours.  This includes factors such as beliefs, values, lifestyle, social status, opinions, and activities.

The easiest way to determine these is to deepen your understanding of your customers. To help, draw on your own business and marketing analytics, focus groups, customer surveys, external profiling tools etc.  For example, have you got a group of customers who are influenced by sustainability when purchasing? If you are a B2B supplier, there may be certain businesses on your database that prefer working with local companies.  In which case, you can emphasise your local credentials to them.

Behavioural segmentation

Behavioural Segmentation is one area that can have a big impact on how you can personalise emails as these are based on your existing customers’ buying behaviours.  They factor in aspects such as purchase behaviour patterns, occasion-based purchases, benefits sought, and customer loyalty facets.

This detail can guide you on what motivates consumers to buy from you in certain situations and i. Identifying your most loyal customers for example means you communicate and focus on keeping them happy. Ascertaining when certain groups of consumers buy from you means you can reach out to them at the right time, hopefully prompting further purchases for example.

Geographic segmentation

This way of segmenting your database is all about location, location, location! You can choose to segment by country all the way down to a specific postcode. If, for example, you have customers based in a particular country that celebrates specific holidays you can share relevant updates and offers with them to coincide with those. Similarly, you can be more focused to target promotions around events you know of in your local community.

On a basic level, even considering cultural aspects and dialect from region to region – then reflecting this in your messaging will help people relate to and understand your messages much more easily.

And finally…

Given the amazing capabilities of today’s technology, the segmentation approaches employed by businesses are often more sophisticated and blend a number of the common areas to create very precise customer segments. In deciding the attributes you want to group people by, be sure that any personal data you store and use is within GDPR guidelines.

Going through the process of segmenting your database can often throw up some interesting discussion, not only you’re the state of your current database but also who you want to attract. It’s also important not to consider email marketing in isolation, but how it can support your other marketing activities.

Be sure to periodically review your segmentation approach over time. Customer behaviour and demographics change and you want to ensure you remain current.  Use the results from how you measure your marketing to alert you to changes.

If you’d like to discuss how to put this into action or would welcome further advice, please do get in touch.