We live in an incredibly diverse world. We’re all drawn to a wide variety of interests, fashions, and trends. Unless your business serves an incredibly narrow niche of individuals, the same is true of your customers. They’re a diverse bunch who may not have a lot in common with each other. Why speak to them all the same way?
The nature of mass email marketing means we can’t address every individual on individual terms. Research clearly indicates that the more we shape our marketing efforts to that goal though, the more attentive and likely to engage with us as a customer each individual becomes. Email segmentation is the means to that end. This practise can increase your open rates, lower unsubscribes, and lead to increased sales and revenue in short order. Sit tight for a few and we’ll look at how you can accomplish that and more, today!
The Benefits of Segmentation
Some of the best data on email segmentation comes from internal studies done by MailChimp, an industry leader in email marketing services. The dataset I’m about to show you is particularly interesting and relevant because it’s a broad internal comparison of their users’ lists. It includes approximately 40 million individual campaigns, comparing segmented versus nonsegmented campaigns. In it, they found that segmented lists have:
- 57.69% higher click throughs
- 14.28% higher open rates
- 10.36% higher unique opens
- 1.17% lower bounce rate
- 8.19% fewer abuse reports
- 8.52% lower unsubscribes
Click through rate is the most important metric here, as the entire point of sending email to customers is to get them clicking through to your website, right? In another study conducted by Hubspot on their own customer database of about 1,200 companies, they found companies employing segmentation (lead nurturing) to have 3x as many clickthroughs as those that do not.
As nice as those numbers are, the benefits of email segmentation is more than just numbers. It gives you the opportunity to build relationships with your customers, what Hubspot calls “lead nurturing” above. You’re treating them like individuals to the extent possible, and that gives you a variety of side benefits. Consider these opportunities:
- Testing: A/B testing isn’t just useful for website optimization and form conversion. Segmented mailing lists means you can test different offers on segments of similar customers and optimize your offers.
- Targeting: Use your testing data to target specific segments with the content that’s most appealing to them. Refining your marketing strategy pays dividends for both you and your customers.
- Tailoring: Not all customers are in the same place in your sales cycle. Not everyone is ready to buy the same thing at the same time, in other words. If you’re not segmenting, you’re making the same offers to everyone despite this fact. Tailor your offers to your customers depending on where they are in their relationship with you: prospective customers, new customers, intermittent customers, regular customers, etc.
How to Start Segmenting?
There’s one important, overarching concept you want to keep in mind while you’re considering how to break up your list. For email segmentation to work, your segments have to mean something- it doesn’t make much sense to randomly segment, right? Taking that into account, when we talk about list segmentation we’re really talking about email personalization at the same time. Your goal should be to come as close as possible to speaking to each name on your mailing list as an individual.
How exactly you segment is largely dependent on you, for the simple reason that no one can know your customers better than you. The best advice is to start small and and analyze your campaigns’ performance as they unfold. Here are some basic ideas that you can employ to get you started.
Follow up the opt-in process with a welcome email/survey.
- What line of products/services that we offer interest you most?
- How frequently would you like to hear from us?
- What type of information about our company are you most interested in?
Depending on your industry, demographic data like age and gender may help a lot in refining your marketing strategy. A variety of different marketing strategies are going to be more and less successful depending on the demographic you’re sending to. Generating a sense of nostalgia for 60-somethings is going to look quite a bit different than for 30-somethings, for example.
Knowing your customer’s location can give you details about what their interests may tends towards. This gives you an advantage in marketing to them. Your summer swimwear offer will likely do much better in Florida than Alaska, for example.
Career path and industry.
Depending on your products, some of what you offer may be much better suited to individuals in the tech sector than, say, construction. Or vice versa. CTOs on your list are more likely to need a different variation of the same product than a lower level employee; volume license access versus single install of a software program, for example.
Hobbiests, sports fans, gardeners, human interest goes in many different directions. If you can leverage that interest in your business, segment your lists to take advantage of it.
- Tailoring your communications to the type and level of interaction you have with sets of customers can be advantageous.
- When did they last purchase from you? Reach out with incentives to return if it’s been a while or reward great customers!
- What did they last purchase from you? Offer something that will compliment it.
- What do they do with your product?
- Are they a free or paid user?
- When did they sign up? Is there an anniversary coming up? Welcome emails (and a survey!) that needs sent?
There’s really no question that each and every one of us responds better to any kind of communication when it’s personal and with our best interests in mind. Humans are social creatures and we thrive on that kind of human to human interaction. As an email marketer, your mission should be first and foremost to replicate that level of human to human interaction as a business. Your strategy should be built around that ideal, and the closer you get to it the better both your business relationships and your bottom line are going to look. Good Luck, happy emailing, and if there’s anything you’d like to add or share, hit up the comments below!