There are two reasons for segmenting your email marketing lists: for testing, and precise marketing. The difference between the two is significant: in the first case those in each list should be as similar as possible, and for the second there must be a difference. So it is important not to mix up the two.
We will stick with the marketing.
The reason you should be segmenting your lists is simple: it gives a better ROI. Whilst the actual percentage improvement varies between tests, they all agree it is substantial. If you are not doing so now, then you are losing out.
With segmenting, each email is designed for people with specific characteristics in common, so all the essentials, such as Subject Line, appearance, banner, text, pictures, product, type of offer and more will appeal to them. It is the end of bland. You have a target.
There are advantages post campaign as well as the returns will tell you much more. You can use that knowledge as a base for your next campaign which will, of course, be that bit more effective.
It is surprisingly easy to segment a list, although there are certain aspects to bear in mind.
There are three main classification of criteria that are used:
A/ Demographics
Probably the first you will opt for as the information might come when the customer subscribed to your email marketing list. You might well ask basic questions, such as gender, age, and, if going for B2B, their position in the company. Location can be a significant factor as well.
B/ Interests
You might ask for general classifications of interests at the sign up stage but experience has shown that replies can be misleading. If they suggest they are interested in scuba diving, what they might mean is that they are thinking of training, but in a warm climate. Included in this category is needs, something which is not always apparent, and occasionally the subscriber is not even aware of.
C/ Behaviour
You will be supplied with ample data to fill this classification. For instance, they might only open emails that promise reductions, perhaps enter items in the basket and then abandon it, or buy at regular intervals.
It is vital not to put too much emphasis on a classification such as income. Whilst it is reassuring to have a subscriber who is in the top 10% of earners, that might not be enough when it comes to segregation. If you are in the travel business, a more useful grading might be how much they tend to spend on a product, or annually. In other words, classify the person on those matters which can be used to predict and target.
But, of course, it is not as simple as that.
Targeting has to be precise and one of three is not accurate enough. Demographics and, to an extent, interests tend to be used as a starting point. You need to have subdivisions to make it worthwhile.
Segmenting adds structure to a database, making an extensive one easier to handle. Not only can your offers be just what your subscribers want, you won’t bother them with those they have no interest in.
We will cover segmenting in greater depth soon.
